Sales promotion
Sales promotion is the program designed to build interest in or encourage purchase of a product during a specified period (Solomon et al., 2006). Sales promotion consists of a variety of techniques intended to provide a short-term incentive to the consumer to buy a product or shop at a particular retailer (Foxman et al., 1998).
It has two categories in B2C e-retailing market, price-based and attention-getting (Solomon et al., 2006).
For price-based promotion, there are mainly three forms.
The first is coupons and voucher, which are tickets for documents that can be exchanged for a financial discount when purchasing a product.
The second is price deals. It is a temporary price reduction to stimulate sales (Solomon et al., 2006).
The third one is special packs, which gives consumers more products instead of lowering the price (Solomon et al., 2006).
For attention-getting promotion, there are also three forms.
The first is point-of-purchase promotion. On one hand, it is creative online displays, signs catching consumers’ attention. On the other hand, it’s the interactive activities making the brand easy to access.
The second is product placements, which get brand featured in movies or television shows.
The third one is cross-promotion. It’s a combination of two or more goods or services forcing to create interest (Solomon et al., 2006).
Sales promotion is an important element of marketing communication strategy that in some countries accounts for more promotional expenditures than advertising (Foxman et al., 1998). In the United States, far more is spent on sales promotions than is spent on advertising — in 1984, expenditures on sales promotions were approximately $80 billion, compared to $48 billion for advertising (Rhea and Massey 1986). Also, in many countries, media for the effective use of advertising are lacking, making sales promotion, personal selling, and publicity even more attractive alternatives to marketers (Foxman et al., 1998). In fact, although some sources predict that advertising spending may increase, it is quite possible that sales promotion expenditures will exceed advertising expenditures in the near future (Hartley and Cross, 1988). And there is a continued growth in the total amount spent on such promotions and in the proportions of overall marketing expenditure given over to sales promotions (Low and Mohr, 2000).
The sales promotion is just another name for a price cut. If brand owners want longer-term success they have to re-emphasise advertising and allocate budgets accordingly (Low and Mohr, 2000). Low and Mohr show that sales promotions are a lazy approach to marketing and do not produce a better or more consistent result than good advertising.
So there is an argument about which one is more important, sales promotion or advertising. For my part, I think it should depend on the recognition of the brand or the brand reputation. When consumers are loyal to a certain brand, what they want is not advertising, because they won’t change to other brands. So they are always looking for a great promotion, like discount. On the contrary, if a brand is a new one, which hasn’t built up brand recognition completely; in other words, not many people know the brand, then the advertising should be prior. Because they should raise their brand awareness first, then keep customers by proper sales promotion.
