Asiance - Digital Agency: Sales Promotion Schemes Project Report MBA

1/17/17 Project Report on Sales Promotion MBA Project Report on Sales Promotion Schemes Sales Promotion and Advertising
ing Project Report Sales promotion
Search
Sample Project Report MBA/BBA, Training Report, Finance Project Reports, HR Project, Marketing Project,
Ads by Google
My Whats App : +91-8398957646
Promotion
Project Report
Asiance - Digital Agency

Seoul based digital agency Digital strategist for Korea Market Go to
asiance.com
Sales Promotion Schemes Project Report MBA
One of the most difficult marketing decisions facing companies is how

much to spend on promotional John Wanamaker, the departmental - store
magazine, said, "I know that half of my advertising is wasted but I don't
know which half."
www.forbes.com
Thus it is not surprising that industries and companies vary considerably in
how much they spend on promotion. Promotional expenditures might
amount to 30-50% of sales in case in cosmetics industry and only 10-20%
in the industrial equipment industry. Within a industry, a low and high
spending companies can be found.
How do companies
decide on their
promotion budget?
There are mainly four
methods of sales
promotion :
Affordable Method :
Many companies set

the promotion budget at
what they think the
company can afford.
www.allprojectreports.com/MBA-Projects/Marketing-Project-Report/sales-promotion-schemes-project-report/sales-promotion-at-different-level-and-differ 1/12
1/17/17 Project Report on Sales Promotion MBA Project Report on Sales Promotion Schemes Sales Promotion and Advertising Project Report Sales promotion
One executive
explained this method
as follows : "Why, its Asiance -
simple. First I go
upstairs to the
Digital Agency
controller and how Seoul based digital agency
much they can afford Digital strategist for Korea
to give us this year. He
Market
says a million and half.
Later, the boss comes asiance.com
to me and asks how
much we should spend
and I say Oh about a Advertising Effectiveness Project Report
million and half."
Internal Customer Satisfaction Project Report
It is a method which is
uncertain one and
makes long term
planning difficult.
Percentage of Sales
Method :
Many companies set

their promotion
expenditures at a
specified percentage of
sales. Accordingly the
sales is set on the basis
of sales.
In this a specified sales percentage is decided for the promotional budget

Advantages of this method :
First, its use means that promotional budget vary with what a company can
afford.
Second, it encourages the management to think in terms of the relationship

among promotion costs, selling price, and profit per unit,
Third, it encourages the competitive stability to the extent that competing

firms spend approximately the same % of their sales on promotion.
Inspite of the advantages, the % sales method has little to justify it. Its
reasoning is circular : It views sales as the determiner of the promotion
rather than as a result. It leads to budget setting by availability of funds
rather than by marketing opportunities.
Competitive Parity Method :
Some companies set their promotional budget to achieve share-of-voice

parity with other competitors. Two arguments are made in support of
competitive parity method. One is that the competitors expenditure
represents the collective wisdom of the industry. The other is that
maintaining a competitive parity helps prevent promotional wars.
Neither argument is valid. There are no grounds for believing that

competition knows better what should be spent on promotion.
Objective and Task Method :
The objective & task method calls upon marketers to develop their
promotion budgets by defining their specific objectives, determining the
task that must be performed to achieve these objectives, and estimating the
cost of performing these tasks.
Deciding on the promotion mix :
Companies face the task of distributing the total promotion budget over the
five promotional tools :
Advertising
Sales Promotion
Public Relations and Publicity
Sales Force
Direct Marketing.
Whatever method a company adopt for promoting its product it must be

from above mentioned method.
What is Sales Promotion ?
Promotion is the final element in the marketing mix. After the nature of product
is decided, its price fixed and the methods of distribution decided, the
manufactures has to take effective steps in meeting the consumers in the
markets. In the present consumer oriented markets it is the duty of
manufacturers to know what is required by the consumer. It is also their duty to
make the customers know where, when how and at what prices. The products
would be available.
Meaning of Promotion
The term promotion is the term and includes mainly three type of
sales activity :
1. Mass impersonal selling methods (Advertising).
2. Face to face personal selling (Salesman ship).
3. Activities other than personal selling and advertising such as point of

purchase display (P.O.P.) show and exhibitions, demonstrations and other
non securing selling efforts. This form of activity is called Sales
Promotion.
There are two type of promotion blends :-
1. Pull Blend.
2. Push Blend.
Both of these are closely related to the channel of Distribution.
1. A pull blend is one in which mass impersonal, sales efforts are given the
greatest emphasis. The purpose of pull blend to pre-sell to the final
consumers. So that they demand the product at the retail level of
distribution. The firm adopting this strategy would spend more on
advertising and sales promotion rather than in personal selling. These
efforts pull down the product from the manufacturer.
2. A push blend emphasizes personal selling. Naturally firms adopting this

method develop a strong sales force at both the distributor and the dealer
level. This method would tends to push the product through the channel of
distribution.
Promotion and Selling
The term promotion is very often used as a synonym for selling. But
selling is a narrow term which includes only transfer of title or personal
selling. Promotion on the other hand is broader in its outlook and
includes a variety of activities used ultimately for increasing sales
volume.
Promotion and Sales Promotion
Similarly the terms sales promotion can not be taken to mean what is
commonly does. Sales promotion, is only a part of the promotion. Basically
promotion is an "exercise" in information persecution and influence. Promotion
has come to mean the over all co-ordination of advertising selling, publicity and
public relations. Promotion is a helping function designed to make all other
marketing activities more effective and efficient. But sales promotion as such
helps only the selling activity still, there exit same difference of opinion on the
real connection of the term sales promotion.
Acc. to A.H.R. Delons :-
"Sales promotion means any step that are taken for the purpose of obtaining or
increasing sales".
Acc. to W.Q. Kelly Opines :-
"Muddled misused misunderstood that is sales promotion Acc. to him the

field of sales promotion as a marketing activity is still vaguely defined and
organized.
Sales Promotion and Advertising
There is no universally accepted distribution between these two terms. To

same advertising includes all forms of mass media communication directed
towards influencing the end consumer. Sales promotion on the other hand,
includes the form of mass communication directed towards information and
influencing the channel of distribution (e.g. distributors, retailers etc.). Hence a
price of product literature distributed by retailers in sales promotion. These
sales promotion merges on one side in to advertising and on the other in to
personal salesman ship. It is concerned with the dissemination of information
to whole salers, retailers, customers (both actual and potential, and to the
salesman).
Sales promotion is concerned with the creation. Application and dissemination

of material and techniques that supplement advertising and personal selling.
Sales promotion makes use of direct mail, catalogues, trade shows, sales
contests, premiums, samples, windows displays and other aids. Its purpose is
to increase the desire of salesman, distributors and dealers to sell a certain
brand to make consumers more eager to buy that brand. Personal selling and
advertising do include prospects to make these decisions. Sale promotion
provides an extra stimulus.
Objective of Sales Promotion
1. To increase sales directly by publicity through media which are

complementary to press and poster advertising.
2. To disseminate information through sales man dealers etc. So as to insure

the product getting in to satisfactory use by the ultimate consumer.
3. To attract new consumer.
4. To face the competition effectively.
5. To help salesman in selling more to the retailers and consumers.
6. To check seasonal decline in sales. Generally speaking sales promotion
involves rendering the following services:-
(a) Services to dealers.
(b) Services to own salesman.
(c) Special publicity.
Sales Promotional at different levels
1. Sales promotion at Dealers Level :-
It may include various schemes some of which are discussed here.
(i) Advertising Materials :-
The advertising material prepared by the company such as store signs,

banners, shelf signs, board etc. are distributed to sub dealer for display
purposes this is in fact a method of advertising.
(ii) Store Demonstration :-
In the promises of the whole saler or the retailer the products sales personnel
will conduct special demonstration for the companies product. A personal
demonstration is good to introduce a new product at its peculiar advantage can
be high lightened and the consumers doubt clear. It can be used to restimulate
an old product. A good demonstration with a great dealer of action will draw
heavy crowds in to the store and will attract attention to the product.
(iii) Special Display and Shows :-
These are in seasonal in character but could be arranged in an elaborate

manner and for all the products of an company. Usually these are arranged
along with trade fair and exhibition. Besides effecting sales these shows
impress the companys name generally on the public.
Sales promotion at consumers level
The various schemes of sale promotion at Consumers Level may include.
1. Coupons (A Chit of Stated Value) :-
These are given directly to the consumer these coupons are in most cases
kept inside the package. The consumers many receive a price reduction of
the stated values of the coupon at the time of purchase. The retailer
receives reimbursement for the value of the coupon form the
manufacturer. Coupons act as a short run stimulus to the sale of the
product, since they are directly tied with the purchase of the item. They
encourage the retailer to stock the product.
What is important is that a coupon offer does not spoil the named price of
the brand nor does it un pair the margin of the dealers. But it is not easy to
measure the effectiveness of a coupon offer. One over knows how many
customer would have bought the product without the incentive. It is also
difficult to find out how many customers were held after the coupon offer
expired.
2. Price-off-offer (Also known as bargain offer price packs) :-
This offer is intended to stimulate the sales during a slump season. In this
method the customer is offered a reduction from the printed price list. It is
also used when a substitute for competing product enters the market.
Many experts on sales promotion fed that Off Schemes are among the
weaker and less desirable methods of promotion. These can be trade
resentment particularly when the retailer raises the price to retain his
margin. Secondly that is not conductive to building up brand loyalty.
Consumers may simply shift to the products that offer this scheme.
3. Samples :-
In the hope of converting a prospect into a customer a sample (Some

quantity of the product) may be given. This helps the consumer to verify
the real quality of the product. Various pair manufacturing companies offer
this method. For developing brand loyalty this method is quite useful.
Sampling is a fast method of demand creation because one knows the
result as soon as the consumer has had time to use the sample and buy the
brand.
Disadvantage of Sampler :-
Offering sample in quit expensive. There is the cost of producing samples.

The distribution costs are also high. Sample have to be mailed to potential
customers or to be distributed through retail shops. There are also
problems when the real product does not resemble the sample supplied.
4. Money Refund Offer :-
An offer usually stated on the package is that manufacturers will return

with in a stated period part or all of the purchasers money if he is not
completely satisfied with the product.
5. Trading Stamps :-
A premium in the form of stamps is given by the sellers to consumers while

selling goods. The number and value of stamp that the buyer receives
depends on the values of the purchase. These stamps are redeemable
through premium catalogues at the stamp redemption centres.
6. Buy-Back Allowance :
This an allowance following a previous trade deal not offer a certain

amount of money for new purchases based on the quantity of purchases on
the first trade deal. It extends the life of a trade deal and helps to prevent
part deal sales decline. It greatly strengthens the buyers motivation to co-
operate on the first deal.
7. Premium :-
There are various forms of premiums provided by the manufacturer as

sales promotional devices :-
(a) Coupons are supplied for effecting price reductions.
(b) Factory in pack premium these are popular in the case of Body food
and Tin food items, Spoons, Cups, Measuring, Glass etc. and such other
items are packed with the product in the box itself. Factory in pack
premium are particularly goods for product meant for children. The Binaca
Toothpaste packs contain animal shape toys. These are very attractive and
qutie popular among the children.
(c) Self Liquidating Premiums :-
The cost of the premium is collected from the buyer himself. But when the
buyers pays for it he has to pay only a considerably low price for the
premium. This is possible for the manufacturer purchases the items in bulk
at a premium and his cost per unit as is substantially low.
Other Steps by Manufacturer for Promoting Sales
Dealers can be helps in different ways :-
1. Communicating Market News :-
Often this service is reciprocal the manufacturer may acquaint his dealer
with the fact relating to his production and prices while the dealer may
familiarize him in return with the information bearing on charges in the
consumer's demand, their like and dislike complaints and criticism,
substitutes etc.
2. Inviting to Sales Conference and Convention :-
The gestures of regard and respect pave the way for better relation and co-
operation.
3. Offering Reasonable Terms of Sale :-
Of all the forms of encouragement, the monetary incentive evokes

immediate response. Hence every producer must offer the most
responsible terms of sale such as longer periods of credit and higher rates
of descants.
4. Supplying suitable packages and useful things.
5. By taking the return back.
6. By furnishing them with sales literature and display materials.
Aggressive Selling
Meaning :-
Goods are produced for market. Manufacturers have to make efforts to

sell all they produce. When the manufacturers uses various sales efforts to
obtain increased sales volume for his product it is called aggressive
selling or offensive selling. The sales efforts which a manufacturer makes
to retain his customers i.e. to protect his already established market
against against his competitors is termed as defensive selling. In contrast
to this aggressive selling is concerned with the sales efforts made with the
express objective of selling more by expanding the market for the product
of the selling firm.
Aggressive Selling and Defensive Selling :-
Aggressive selling is based on the answer to the question how much does
the firm gain (in term of sales with profit) by using this method defensive
selling is based on consideration as to how much the firm will lose if it does
not use this method increase of sales can be obtained from two sources:-
1. New customers if the market is expending.
2. From the competitors i.e. those consumers who were purchasing similar
product of competiting firms, if the market for the product is static.
Acc. to H. Whitehead :-
"In case of an expanding market all the firm may stand to gain by following
the methods of aggressive selling but if the market is static manufacturer of
a new market will have to be much more aggressive to capture the
established market of competitors".
When Aggressive selling is resorted ?
Usually manufacturer of a new product has to do aggressive selling :-
1. When the product has been improved.
2. When the manufacturers product is supervisor in quality to the product

of the established competitor.
3. When the total market for the product or line of product to expanding.
4. If the manufacturers share of the market is comparatively small.
5. If the manufacturer has unused production capacity with heavy

investment in plant and equipment he will like to develop the demand for
his product rapidly so that demand for his product is equal to the optimum
production capacity of his plant ; and
6. When primary demand for a product must be created and provision

must be made in the channel of distribution to educate consumers regarding
the new product and to instruct them in its use.
Method of Aggressive Selling :-
Sales promotion efforts use for aggressive selling may be divided in two
classes.
1. Trade Promotion.
2. Consumer Promotion.
1. Trade Promotion :-
Under trade promotion methods special incentives are offered to the trader
to buy products of the firm. Such incentive may take one or more of the
following firm :-
(a) Cash Allowance :-
A definite percentage of discount is allowed on the purchase of given unit

of a product.
(b) Extra Product :-
Instead of giving any cash allowance extra product is given with each unit
of product ordered. For instance if a box normally contains 20 Cakes of
Soap, special box contains 25 cakes may be made and sold at the same
price as that of the box of 20 cakes.
(c) Gifts :-
Various gifts are awarded in return for an order of a particular magnitude.
2. Consumer Promotion :-
Under consumer promotion method special incentives are offered to the

consumers to buy the firms product. The more prominent amongst such
incentives are as following.
(a) Coupons :-
www.allprojectreports.com/MBA-Projects/Marketing-Project-Report/sales-promotion-schemes-project-report/sales-promotion-at-different-level-and-diffe 10/12
A coupon of a giving value is sent to the consumer. By presenting this

coupon to the retailer consumers can purchase a particular product
mentioned on the coupon at a reduced price. The retailer sells the products
mentioned. In the coupon to such consumer (consumers presenting the
coupons) under and agreement with the manufacturer at a price lower than
the user retail price. Thus the consumer get the benefit of reduced price to
the extent of the value of the coupons.
(b) Self Liquidating Offers :-
Under this system, the firm offers an article at an attracting price if the
consumer send a given sum of money accompanied by a given number of
box tops from the packages of a particular product the benefit to the
consumer is that he receives the articles at a bargain price.
(c) Bargain Packs :-
Under this system a product is sold at a reduced price for a short period
Bargain pack method encourages new consumers to try the product. It is
also helpful in obtaining large displays in the shops.
(d) Sampling :-
The method involves giving the product or a small quantity of the product
to a consumer free with the hope that the customer will be favourable
impressed with its actual use and will eventually become a regular
purchaser of the product.
A firm selling new product or an extensively improved product finds this

methods useful. Also a firm whose market is hold by competitors whose
free sampling almost expensive.
The above mentioned methods may be reinforced by adopting.
(i) Direct method of selling through.
(ii) Offer of door to door selling.
(iii) Hire purchase and installment payment methods of selling and by

forming combination.
Other Methods of Aggressive Selling :-
(i) Employment of Missionary Salesman also known as Promotional

Salesman. These salesman call upon retailers and aggressively promote a
product.
(ii) Instead of using wholesalers, the firm may develop its own sales force
to call directly on retailers.
(iii) The firm may follow a compromise method by employing a

manufacturers agent and giving him a large enough commission to
encourage him to sell product intensively and aggressively.
(iv) New territory exploitation sales promotion has a particularly important

role in developing the companys product in new territories.
(v) Increment and promotions.
(vi) Letters to dealer and Customer.
In fact, an ingenious sales manager can devise any number of incentives

schemes for promoting the sales volume.
Project Report on Sales Promotion Schemes .................
Home| Chemistry Projects| Biology Projects| Physics Projects| Science Projects| HR Projects MBA| Finance Projects
MBA| Marketing Projects MBA
Website Developed by : Connecting World Team
(Privacy Policy)

Asiance - Digital Agency: Sales Promotion Schemes Project Report MBA

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Asiance - Digital Agency: Sales Promotion Schemes Project Report MBA

Uploaded by

Copyright:

Available Formats

1/17/17 Project Report on Sales Promotion MBA Project Report on Sales Promotion Schemes Sales Promotion and Advertising

ing Project Report Sales promotion

Asiance - Digital Agency

Sales Promotion Schemes Project Report MBA

One of the most difficult marketing decisions facing companies is how

Many companies set

Many companies set

In this a specified sales percentage is decided for the promotional budget

Second, it encourages the management to think in terms of the relationship

Third, it encourages the competitive stability to the extent that competing

Competitive Parity Method :

Some companies set their promotional budget to achieve share-of-voice

Neither argument is valid. There are no grounds for believing that

Objective and Task Method :

Deciding on the promotion mix :

Public Relations and Publicity

Whatever method a company adopt for promoting its product it must be

What is Sales Promotion ?

1. Mass impersonal selling methods (Advertising).

2. Face to face personal selling (Salesman ship).

3. Activities other than personal selling and advertising such as point of

There are two type of promotion blends :-

Both of these are closely related to the channel of Distribution.

2. A push blend emphasizes personal selling. Naturally firms adopting this

Promotion and Selling

Promotion and Sales Promotion

Acc. to A.H.R. Delons :-

Acc. to W.Q. Kelly Opines :-

"Muddled misused misunderstood that is sales promotion Acc. to him the

Sales Promotion and Advertising

There is no universally accepted distribution between these two terms. To

Sales promotion is concerned with the creation. Application and dissemination

Objective of Sales Promotion

1. To increase sales directly by publicity through media which are

2. To disseminate information through sales man dealers etc. So as to insure

3. To attract new consumer.

4. To face the competition effectively.

5. To help salesman in selling more to the retailers and consumers.

6. To check seasonal decline in sales. Generally speaking sales promotion

involves rendering the following services:-

(a) Services to dealers.

(b) Services to own salesman.

(c) Special publicity.

Sales Promotional at different levels

1. Sales promotion at Dealers Level :-

It may include various schemes some of which are discussed here.

(i) Advertising Materials :-

The advertising material prepared by the company such as store signs,

(ii) Store Demonstration :-

(iii) Special Display and Shows :-

These are in seasonal in character but could be arranged in an elaborate

Sales promotion at consumers level

The various schemes of sale promotion at Consumers Level may include.

1. Coupons (A Chit of Stated Value) :-

2. Price-off-offer (Also known as bargain offer price packs) :-

In the hope of converting a prospect into a customer a sample (Some

Offering sample in quit expensive. There is the cost of producing samples.

4. Money Refund Offer :-

An offer usually stated on the package is that manufacturers will return

A premium in the form of stamps is given by the sellers to consumers while

This an allowance following a previous trade deal not offer a certain

There are various forms of premiums provided by the manufacturer as

(a) Coupons are supplied for effecting price reductions.