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Sales Promotion

REVIEW OF LITERATURE INTRODUCTION In a time when customers are exposed daily to a nearly infinite amount of promotional messages, many marketers are discovering that advertising alone is not enough to move members of a target market to take action, such as getting them to try a new product. Instead, marketers have learned that to meet their goals they must use additional promotional methods in conjunction with advertising. Other marketers have found that certain characteristics of their target market (e.g., small but geographically dispersed) or characteristics of their product (e.g., highly complex) make advertising a less attractive option. For these marketers better results may be obtained using other promotional approaches and may lead to directing all their promotional spending to non-advertising promotions. Finally, the high cost of advertising may drive many to seek alternative, lower cost promotional techniques to meet their promotion goals. Sales promotions are used widely in many industries and especially by marketers selling to consumers. We will see that the objectives of sales promotion are quite different than advertising and are specifically designed to encourage customer response. DEFINITION An activity designed to boost the sales of a product or service. It may include an advertising campaign, increased PR activity, a free-sample campaign, offering free gifts or trading stamps, arranging demonstrations or exhibitions, setting up competitions with attractive prizes, temporary price reductions, door-to-door calling, telemarketing, personal letters on other methods". Promotion is part of marketing which can be considered as one of the youngest disciplines in the business world and is driven by innovation (Sutheralnd and Canwell, 2004). Within it, marketing communications, or promotion, is a management process through which an organization engages with its various audiences. Through understanding and audiences communications environment, organizations seek to develop and present messages for their identified stakeholder groups, before evaluating and acting upon the responses received. By conveying messages that are of significant value, audiences are encouraged to offer attitudinal and behavioral responses (Fill, 2005). Generally, promotion is used by organisations to communicate with customers with respect to their product offerings. In this sense, promotion is one side of the communication process with customers (Rowley, 1998). These days people and customers are exposed to radio on FM, medium wave and long wave, three national commercial stations and some 180+ regional and local commercial radio stations. There are over 3500 magazines covering every imaginable interest. There is a wide range of outdoor media, not just fixed poster sites, but posters on the sides of buses and taxi cabs, on the underground and at railway stations, not to mention that many people have become walking advertisements for the brands they wear, with cloths bearing logos for all to see. In this array of confusion, marketing communications increasingly represents the single most important opportunity for companies to convince

potential consumer of the superiority of their products and services (Yeshin, 1998). Another important factor for marketers is speed of information access, especially in todays rushed world, in which the growth of information technology is fast. Not only information can be processed more rapidly but it also mean that access to that information can be made far more promptly than at any time in the...

Overview Of Fmcg Sector


Overview Of FMCG Sector What are FMCGs? WE regularly talk about things like butter, potato chips, toothpastes, razors, household care products, packaged food and beverages, etc. But do we know under which category these things come? They are called FMCGs. FMCG is an acronym for Fast Moving Consumer Goods, which refer to things that we buy from local supermarkets on daily basis, the things that have high turnover and are relatively cheaper. FMCG Products and Categories - Personal Care, Oral Care, Hair Care, Skin Care, Personal Wash (soaps); - Cosmetics and toiletries, deodorants, perfumes, feminine hygiene, paper products; - Household care fabric wash including laundry soaps and synthetic detergents; household cleaners, such as dish/utensil cleaners, floor cleaners, toilet cleaners, air fresheners, insecticides and mosquito repellents, metal polish and furniture polish; FMCG in 2006 The performance of the industry was inconsistent in terms of sales and growth for over 4 years. The investors in the sector were not gainers at par with other booming sectors. After two years of sinking performance of FMCG sector, the year 2005 has witnessed the FMCGs demand growing. Strong growth was seen across various segments in FY06. With the rise in disposable income and the economy in good health, the urban consumers continued with their shopping spree. - Food and health beverages, branded flour, branded sugarcane, bakery products such as bread, biscuits, etc., milk and dairy products, beverages such as tea, coffee, juices, bottled water etc, snack food, chocolates, etc. - Frequently replaced electronic products, such as audio equipments, digital cameras, Laptops, CTVs; other electronic items such as Refrigerator, washing machines, etc. coming under the category of White Goods in FMCG; Sector Outlook FMCG is the fourth largest sector in the Indian Economy with a total market size of Rs. 60,000 crores. FMCG sector generates 5% of total factory...

Analyis Of Fmcg Sector In India


ANALYIS OF FMCG SECTOR IN INDIA (MOHD FARHAN KHAN) Fast Moving Consumer Goods (FMCG) goods are popularly named as consumer packaged goods. Items in this category include all consumables (other than groceries/pulses) people buy at regular intervals. The most common in the list are toilet soaps, detergents, shampoos, toothpaste, shaving products, shoe polish, packaged foodstuff, and household accessories and extends to certain electronic goods. These items are meant for daily of frequent consumption and have a high return. A major portion of the monthly budget of each household is reserved for FMCG products. The volume of money circulated in the economy against FMCG products is very high, as the number of products the consumer use is very high. Competition in the FMCG sector is very high resulting in high pressure on margins. FMCG companies maintain intense distribution network. Companies spend a large portion of their budget on maintaining distribution networks. New entrants who wish to bring their products in the national level need to invest huge sums of money on promoting brands. Manufacturing can be outsourced. A recent phenomenon in the sector was entry of multinationals and cheaper imports. Also the market is more pressurized with presence of local players in rural areas and state brands A subset of FMCGs is Fast Moving Consumer Electronics which include innovative electronic products such as mobile phones, MP3 players, digital cameras, GPS Systems and Laptops. These are replaced more frequently than other electronic products. White goods in FMCG refer to household electronic items such as Refrigerators, TVs, Music Systems, etc. In 2005, the Rs. 48,000-crore FMCG segment was one of the fast growing industries in India. According to the AC Nielsen India study, the industry grew 5.3% in value between 2004 and 2005. SCOPE OF THE SECTOR The Indian FMCG sector with a market size of US$13.1 billion is the fourth largest sector in the economy.

ndian Fmcg Sector


The fourth largest sector in the Indian economy is all set for 16% growth during 2008-09, from a base of Rs. 85470 crores, as predicted by FICCI. Going forward, as anticipated by CRISIL, FMCG sector will touch around Rs. 140000 crores by 2015 (33.4B$). This post will through some pointers for growth in FMCG Sector and update with the contemporary category trends. Growth Drivers: FMCG Sector 1. Disposable Income: There is increase in disposable income, observed in both rural and urban consumers, which is giving opportunity to many rural consumers to shift from traditional unorganized unbranded products to branded FMCG products and urban

fraternity to splurge on value added and lifestyle products. The increasing salaries, along with rising trend of perks in the corporate sector at regular intervals, have increased peoples spending power. As per some research, there is a high correlation between Disposable per capita and HPC per capita. 2. Organized Retail: The emergence of organized retail have lead to more variety with ease in browsing, opportunity to compare with different products in a category, one stop destination (entertainment, food and shopping) etc, which is playing an important role in bringing boom in the Indian FMCG market. Currently the modern trade is capturing 5% of the total retail space, which will increase to 10% and 25% in 2010 and 2025 respectively. Also, as the credit card and organized retail trend picks up, people wont think much while buying and buy more. 3. Distribution Depth - Rural Penetration: There are 5500 towns and 6.38 Lacs villages with 2.5Mln and 5Mln outlets respectively. Due to saturation and cut throat competition in urban India, many FMCG companies are devising strategies for targeting rural consumers in a big way. Many FMCG companies are focusing on increasing their distribution network to penetrate with a step by step plan. This is the reason that FMCG urban market size has dropped from 50% to 29% in last 5 years....

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