Improve Revenue With Effective Sales Promotion

Sales promotion means driving sales. The next question is how? Sales promotion involves the use of advertising, sponsoring, or similar initiatives to increase the number of sales within a company. Businesses do sales promotions through a variety of channels.

One of the most common ways is through the use of discounts or coupons. A common practice is to sublimate the real cost of an item through direct mail and newspaper advertisements originating from the seller itself. When you engage in these activities, you’re using a sales promotion strategy.

Experts believe advertising and sponsoring have two different philosophies. The first is that consumers are too smart to fall for gimmicks, and the other is that sales will eventually rise to the norm.

Types of Sales Promotion

Sales promotion takes many forms. The sales promotion strategy you use varies according to your business needs. This section explains the most common types.

1. Flash Sales

A flash sale is an exciting but time-bound offer. It is a good way to make customers buy your product quickly. This is because there’s a sense of urgency. Retailers often use flash sales to free up their shelves and let go of old stocks. Striking gold with flash sales is by creating a sense of urgency and offering an irresistible deal.

2. Discounted Prices

Offering products at discounted prices is perhaps the most common of them all. Customers always look forward to it. The important thing is to make the discount attractive without affecting your profit. More importantly, you shouldn’t do it often because customers may soon consider it a norm.

3. Coupon Giveaway

A coupon giveaway is another means of product discount. Sending coupons to customers gives them a sense of exclusivity. This could encourage them to check out your online store and make a purchase. You could use coupons to encourage loyal customers after spending a certain amount. You could also use it to compensate customers that experienced poor customer service.

4. Running Competitions

This is a potent sales promotion tactic if you do it well. It’s like using a stone to kill two birds. You give out a few items as prizes while gaining many customers. It is a good way of rewarding loyalty and gaining new customers.

5. Tiered Promotions

Tiered promotions entail offering more discounts to customers the more they spend. It is known as ‘buy more save more.’ It is a way of ‘baiting’ customers into buying more products. For instance, a customer that spends $50 may get 5% off; if they spend $100, they get 10% off, and so on. Customers feel they get a better bargain by spending more.

What Are the Goals of a Sales Promotion Strategy

It is hard to distill the goals of sales promotion into a handful of goals because sales promotional tools vary. However, there are three main objectives of sales promotion that are always constant.

1. Communication

Sales promotions attract attention and typically lead to information sharing that might open a line of communication between a business and a potential customer. Often, it is used in the early stages of customer interaction. It is a marketing tool that helps to improve customer retention rates.

2. Incentive

Sales promotions incorporate some concession, inducement or contribution designed to represent value to the receiver. Buyers want to feel they are getting the best deal. Businesses prey on this by offering incentives that induce customers.

3. Invitation

There is a distinct promotional invitation for the target audience to engage in a transaction immediately.

To Wrap Up

The key to pulling off effective sales promotions is understanding your target audience, the product being promoted, and the context of the promotional event.

Educating yourself about the different sales promotion strategies helps you efficiently plan a campaign that guides your target audience to your product. If your plan for a sales promotion is insightful, you will have a successful promotion and enjoy the work that goes into creating it.