Importance of Sales Promotion

Pandey and Mishra (2012) described sales promotion as powerful technique that helps in getting

an extra competitive edge to attract new customers. Consumer’s price consciousness is an

important concern of sales promotion strategies, because these encourage the buyers to try

promoted brads or purchase greater quantity of products. Retailers also add some offers in sales

promotional activities to target the end customer.

Rizvi and Malik (2011) describe that when sales promotion techniques are implemented

effectively they bring often increased sales during short term. This describes the concern of

organizations to devote a heavy sum funds for launching sales promotional schemes. This proves

that, effects of sales promotional schemes has not positive impact on the financial position of

company in the long run, but it has significant impact on firm profitability in particular time

span.

Impact of sales promotional strategies varies on the bases of the attractiveness of the

targeted brand. (Alvarez & Casielles, 2005). These are useful tools that caused increased in

brand demand that has strong market position less risk associated with the existing brand

(Blattberg, Robert, & Neslin, 1990).

The majority of the research studies made on sales promotion based on the use of

monetary promotions whereas little research is done on the non-monetary promotions and with

lack of concentration on the Asian market (Garretson & Burton, 2003).

Research studies in Malaysia discovered that for manufacturer of retailers to encourage

customers to shop at their counters, sales promotion would appear to be the most suitable way or

medium (Ndubisi & Chiew, 2005, 2006). Previous studies mentioned that well implemented

sales promotion methods would help retailer owners or manufacturers to persuade customers to
patronize their sales counters and to try out the products and services are promoted, and in return

would facilitate the manufacturers and retailers to get their desired objectives (Alvarez &

Casielles, 2005).

According to Kotler and Armstrong (2002) Consumer promotion strategy is employed to

increase the sales volume of the products. Price packs, free samples, coupons, sweepstakes are

the techniques of consumer sales promotions. Pauwels, Hansens & Siddarth (2002) has explained

the impact of sales promotions on the permanent bases on aggregate annual sales for two types of

products; perishable and storable products. It is found that these types of products have no

prominent effect of sales promotion techniques. It is also observed that impacts of promotion are

short lived and remain effective 2 week on average and at most 8 weeks for storable and

perishable products.

Sales promotions create two reactions in customers. The first one is increased in

consumption, i.e. larger quantity of a product is bought. The second effect of promotions is to

store product for the future use. Chandon and Wansink (1999) compared these effects for certain

kinds of product. Though, these effects vary depending on the attractiveness of the promotional

activities employed.

According to Gupta (1993) it is possible that customers, who do not purchase the certain

brand, will have a desire to acquire it due to sales promotion offers which attract. However,

Brandweek (1994) argued that there are some people who often change the brand because of a

promotion change back to their preferred product brand when purchasing that type of product

after.

It is essential to mention that the use of sales promotional tools promotes the brand and

items purchase and increases consumption pattern. However it is also important to keep yourself
alert, as the negative effect could be generated on certain times. This may occur when the buyer

perceives that he is being cheated for unnecessary activities to create the product position. This

perception then provokes the negative effects to the intended results, i.e. the consumer stops

purchasing the promoted products and services (Simonson, Carmon & Crry, 1994). It is possible

too that the consumers avoid purchasing the promoted products because he has not to justify his

research to their belonging group (Simonson, 1989). Another reason of not getting expected

results is that the buyer feels that he is being used and will “punish” the seller by not buying the

promoted product or brand.