Page 223 - DMGT509_RURAL MARKETING

Rural Marketing

Notes Thus sales promotion is an offer of direct money saving to the customer without diluting
products brand equity (as can happen in case of price reductions). Consumer sales promotion
encourages new product sales, increase usage of existing products, helps sales of entire ranger of
products and adds to selling efforts. Retail promotion helps in building inventories with the
distribution network and indirectly acts as a sales push in the market as no one can keep large
inventories for long.
Depending on product and trade practices firms send dealers on trips to foreign countries on
achieving the targets. Some firms offer cars and other consumer goods as incentive to achieve
the sales as planned. Promotion programmes are known to increase sales and market share,
which lasts as long as competition does not retaliate. Hence it is wise to be closely observing
competitive activities, and being proactive rather than reacting to losing situations.

For example, Coke and Pepsi advertise in order to promote sales as well to encourage retail
trade to keep their products.
Customer promotion can be undertaken as follows:

1. Test our new product or re-buy. Added incentives make people give new products
a try.
2. Be loyal to us, we are there to look after you through our promotional plans.

3. Buy more – Pepsi says, “yeh dil mange more” – the heart wants more.
4. Buy our entire range – for this purpose sometimes products are bundled together.
5. Promotion increases sales immediately. It helps in advertising and other marketing efforts
like personal selling. Just as it is important to advertise the promotions so that the customer
gets to know about it. Lack of advertising for the target market will render the promotion
campaign unrewarding and the objectives will not be met.
Trade promotion helps in the following manner:
1. Get better distributors
2. Better shelf space at the retail stores

3. Superior merchandizing
4. Increase stocks and sales push
5. Training the sales personnel of retailers
6. Better product knowledge (as a spin off)

7. Improvement in dealer responses in future
Sales promotion takes up to 70 of total marketing budget and hence it is a major factor, which
needs constant nurturing. The main reasons for the shift towards promotion are as follows:

1. Immediate results: with focus on meeting target sales promotion provides quick response
technique.
2. Measuring effectiveness: as the results are quick to achieve, promotional plans results can
be seen early.
3. Retailers have acquired a status they never had, as through computerized information
base they know their customers, their buying powers and habits best. Therefore, promotion
plans with retailers at the hub, can be most effective.

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