Showing posts with label Sales Promotion. Show all posts
Showing posts with label Sales Promotion. Show all posts

Public Relation in Marketing for Maintaining Image or Reputation of the Company

Meaning of Public Relation


The institutional advertisement done for maintaining image or reputation of the company is called public relation. Public relation is an important tool for sales promotion. In order to maintain image of the company, different promotional programs are conducted. Such programs can have positive effect on target group or potential customers.
This communicates true information to customers, distributors, employees, local communities, suppliers etc. about the company and its programs through different media.
According to Prof. William J. Stanton, "Public relation is a management tool designed to favorably influence attitude towards an organization, it s products and its policy."
This definition makes it clear that public relation creates an environment to understand the company's programs, policy and strategy positively. Such views, expression or attitudes may come out through books, writings, press or house publication.

Generally, the task of presenting positive information or news about organization is public relation. It tries to make wide publicity about products by seeking sponsors. Besides this, public relation establishes good understanding between organization and people. Similarly, it provides true information, suggestion, advice etc. about the issue of public concern and position of the company. So, public relation is very important.

Nature of Public Relation


In this modern age, public relation is very important task of marketing. It is used for the bright future of a business organization. It creates positive environment/atmosphere for conducting business. It also maintains good understanding between customers and company. It has its own nature and forms which are mentioned as follows:

1. Press relation


News and information about the organization are disseminated through press media. Press media publish positive aspects of the company. While giving true and factual description of the company, the company gives emphasis on its objective, philosophy, policy and programs. Here press media means, specially, booklets, pamphlets, reports, literary writings, magazines etc. The main role of articles is also to point out the form of public relation. Similarly, both the house and outside publication can strengthen public relation.

2. Public service relation


Publicity about company's activities can be made through different sponsors. This can establish public relation without cost or with little cost. Similarly, any organization may help to disseminate information to promote understanding. The tactical policy of influencing parliament, government or rules and regulations, legal provision and helps in promoting them also serve public relation. It helps to heighten the image of the company. Counseling, suggestion, advice of any party or group may greatly help management. Similarly, raising voice for the interest of public and related subjects also helps management. Such nature appears in the public relation. They also become beneficial to the company.

Objectives of Public Relation


Public relation/contact plays an important role in creating positive image of the company. This task gives effective confidence to the local community, customers, employees, stockholders and government. Such creative activities need some objectives which are mentioned as follows:

1. Awareness


Public relation provides sufficient information and news about any company and its products. It also provides sufficient information about the company's leadership and its role. This makes concerned sides aware. So, marketing expert should determine awareness as its first objective.

2. Established Credibility


Various information and news about the company and its products are provided through different media such as newspapers, magazines etc. The editorial columns provide real position of the company. This gives confidence to the concerned sides of the company and products.

3. Creation of favorable/positive image


Public relation creates positive image of the company. This also encourages the manpower and dealers engaged in selling. They feel proud thinking, "We are involved in dealing in quality goods of reputed company." This encourages the employees to discharge their duty successfully and play important roles to maintain good image of the company.

4. Reduction of promotion cost


Leaders, opinion, researchers and publisher carry out informative articles about the company. This costs much lesser cost than the cost for advertisement. The saved promotion cost can be used in other works. So, the objective of public relations is to reduce/minimize the promotion cost.
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Methods of Sales Promotion, Trade Promotion, Consumer's Promotion

Methods of sale promotion create demand and increase sale volume of goods. There are various methods of sales promotion. The important methods can be divided into three classes for easy study as follows:

1. Consumers' Promotion Method


While selling or distributing any product of any company, first priority should be given to the interest and satisfaction of the customers. The producer should think the consumers as the monarch of the market. They also should be stimulated to buy goods or services. Success can be achieved only if they are attracted. To attract the attention of the consumers, the following methods should be applied:

a) Free sample

Newly introduced products can be given as gift to the consumers when they come to buy any goods. Similarly, if the customers buy certain amount of product, certain amount/units of new products can be given as gift. New products can also be distributed to the customers free of price through post, shop, or any other means keeping with other goods. In order to bring new products in market, the customers can be distributed even if the customers do not buy any. Although costly, this method becomes very effective for sales promotion.

b) Coupon

Any type of evidence can be provided to the customers who buy goods from the seller. It is called coupon. If the customers go to the same shop to buy goods in nature, the seller may give any kind of gift or discount. Trade mark also can work as coupon. Such type of coupon becomes more effective for established products in market. This coupon can be kept into packets of products. It also can be distributed while the customers are buying goods. This method encourages the customers to make repeated purchase order.

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Meaning of Sales Promotion


c) Premium or gifts

Giving gift or selling goods at discount price is called premium or gift method. This increases sales volume. Giving steel cups, glasses and spoons for buying Horlicks, Boost, giving glasses for buying beer, giving polish for buying shoes etc. are the some of the examples of this method.

d) Price-off/discount

Sometimes or in certain season, the target customers can be attracted by announcing price off / discount in market price. This kind of discount / price off should be advertised through effective media. Discount of price in goods on the occasion of Vijaya Dashami, Tihar / Deepawali, etc. are the examples of price off or discount.

e) Consumers' contest

Consumers can be drawn in contest by giving questions to the customers through any national or local newspaper and asking them to send correct answers of the questions. The customers should win the contest applying their creativity and intelligence. In this way, the first, second and third position holders can be distributed price free gifts, free travel coupon, hotel facility etc. On the other hand, lottery can be distributed to the customers buying certain amount of goods. The lotteries are made public each month and the winners are distributed prizes. This is called consumer contest method. This method becomes effective in sales promotion.

f) Decoration and display

Consumers are attracted by displaying or decorating or showing goods to them at the places where they gather. Short introduction or explanation of the products also is given to the customers at systematically held display or exhibitions. On such occasion, products may be distributed free of price from which the customers know about the quality, utility, features etc. of the goods. This method stimulates the customers to buy goods as soon as possible.

2. Trade Promotion Method


The trade promotion method is called intermediary promotion method. For increasing sale volume the channel members such as wholesalers, retailers, dealers etc. should be encouraged. The following methods can be used for trade promotion.

a) Free goods

Goods can be distributed free of price if the customers buy goods in certain quantity within certain time. This method gives additional encouragement to wholesalers, retailers, traveling sellers to buy goods. It also encourages intermediaries/middlemen to keep more inventories.

b) Allowance

The middlemen or intermediaries who sell goods in more than determined quantity can be encouraged by giving allowances. Similarly, cash allowance, or facilities are provided for advertising, decorating and conducting different promotional activities. This facility motivates intermediaries/middlemen to deal/sell goods. This is supposed as strong method of trade promotion.

c) Gifts

Immediately after buying any goods/product, gift is given to the buyer or intermediary. Even by giving small gifts, the middlemen can be encouraged to sell or deal in goods. Diary, calendar, ball-pen, wall-clock, key-ring, lighter, glass, cup, T-shirt, astray etc. are the examples of such small gift. This also increases sales quantity.

d) Price-off/reduction

Price off every product / goods is fixed in market price list. But price may be deducted from the list temporarily to encourage the middlemen to buy goods. Generally, this method becomes suitable in unfavorable season.

e) Credit facility

Regular and sincere middlemen can be provided credit facility. Such facility motivates them to buy goods. This also plays an important role in bringing/introducing new products in market. Because of credit facility, each middleman tries to increase inventories.

3. Sales for Promotion Method


Every company appoints representatives or sellers in order to make selling effective. Sales volume can also be increased by encouraging or motivating them. The company can get success in increasing sales and earning more profit. Proper arrangement of incentive should be made to create pleasant and suitable environment for motivating employees to work sincerely. They can be mentioned in short as follows:

a) Bonus and commission

Sellers can be given commission on the basis of sales quantity / volume. The seller, who can sell more quantity or volume than others, gets cash commission. Similarly, if any seller sells more volume than a certain limit, additional amount can be given as reward or bonus or commission. This increases interest of the sellers to sell more quantity of goods for getting more bonus or commission.

b) Sales contest

The sellers should be given encouragement or motivation for selling maximum quantity of goods. For this, sale contest should be organized or conducted. Clear criteria should be fixed to take part in such contest. The sellers who get success in such contest should be given attractive reward. Such program greatly contributes to sales promotion.

c) Gifts

Sales can be promoted by giving small goods of low prices to the sellers. Even if such goods may be cheap, they are useful in household use. Sale employees can be provided reward such as pen, watch, diary, calendar, lighter, T-shirt etc. to the sellers.

d) Promotional kits

Besides this, all the sellers can be given catalogue; brochure and other information about goods can be provided. The concerned sellers need to know about the goods intended to sell. Similarly, sellers should also be encouraged by displaying some models of goods.

e) Sales meeting

Sellers should be given clear information about company's policy and programs. For this, the top level management should call sales meeting. Through the same meeting, important information can be given to all the concerned sellers, by which they get motivated and encouraged to bear more responsibilities and perform works successfully.
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Sales Promotion: Short Term Encouragement / Stimulation for Attraction of Potential Customers

Meaning of Sales Promotion


Short term encouragement/stimulation used to create demand for the goods intended to sell is called sale promotion. This is an important element of promotion mix. In this competitive environment, its importance and popularity has been increasing daily. Sales promotion plays an important role to attract potential customers.

Various methods such as free sample distribution, rebet, coupon, price reduction, gift, decoration, fair, premium, display etc. can be used. Some producers keep cash prize into packets of goods.

The meaning of sale promotion can be clearly understood from the definitions given by experts and writers as follows:
According to Prof. William J. Stanton, "Sales promotion refers to demand stimulating device designed to supplement advertising and facilitate personal selling."

 

According to American Marketing Association, "Sales promotion refers to those marketing activities other than personal selling, advertising and publicity that stimulate consumer purchasing and dealer effectiveness such as display, show and exposition, demonstration, and various non-recurrent selling efforts not in the ordinary routine."

 

According to Prof. Philip Kotler, "Sales promotion consists of a diverse collection of incentive tools mostly short term, designed to stimulate quicker and/or greater purchase of particular product/services by customers or the trade."

 

The above mentioned definitions make it clear that various ways or methods that are devised to create demand for goods or services is called sales promotion. All the short term ways or methods devised for creating demand are called sales promotions. It works as the bridge to link advertisement and personal sale. Sales promotion also helps wholesalers and dealers.

Objectives of Sales Promotion


Generally, activities of sale promotion are conducted to expand/amplify sales. There may be various reasons and objectives for sale promotion. The main reasons or objectives are:

1. To attract new customers


Sales promotion activities should be conducted to attract attention of new customers. There are many methods to attract attention of the customers. Among them free sample distribution, coupon, price deduction, decoration are some of the examples. Such activities attract customers' attention. They may even give up / change the brand they have been using and get stimulated / encouraged to choose other new brand goods.

2. To introduce new product


The second objective of sales promotion is to introduce or present new products to the market. Bringing new product in market is very challenging and difficult task. It becomes difficult to sell new products in markets only using advertisement, personal sale and publicity or propagation. So, effective activities should be conducted for sales promotion. Sample display, presentation, trade fair etc. should be held to introduce or bring new product in the market. If new products are brought in market, they can face competition to some extent.

3. To encourage greater purchase volume


Sales promotion activities should be able to increase sales volume. The third objective of sales promotion is to increase sales volume and encourage customers to purchase more quantity. As different methods and tools of sales promotion encourage customers they become ready to buy and use greater volume of goods. Only when such situation is created, sales promotion becomes effective.

4. To educate the customers


Goods may remain in different conditions. Further improvement can be made by adding up some new features only after the products reach the maturity stage. This is called product modification. While adding new features to the products, quality and prices also are changed. So, customers should also be given full information about it. The same task is called educating the customers. Hence, sales promotion has the objective to educate customers.

5. To maintain selling stability


Sales quantity / volume remains changing for one or the other reasons. Sales may get fluctuation according to season or time. Greater volume of goods can be sold out in favorable season and less volume in unfavorable season. But, the sales volume can be maintained same even in unfavorable season by using tools of promotion, due to which selling stability remains for long. If stable sale is maintained, both the seller and buyer sides can get benefits.

6. To increase seller's inventories


The sales promotion activities increase the sales volume. When the sales volume increases, the wholesalers and retailers also should increase their inventories. Sellers become ready to increase inventories, provide facility, reduce price by purchasing goods even in unfavorable season. As a result, the inventories increase automatically.

7. To increase brand awareness

Sales promotion should make clear what products have been given brand name and their quality. In this way, to increase brand awareness in customers is also another important objective of sales promotion. Sample presentation, display, trade fair, etc. also greatly help to increase awareness.

8. To make better store display


Sales promotion inspires / encourages the retailers to make better display of goods in their shop. Nowadays, the producer of Lux soap, Bond Cigarette etc. have encouraged the retailers to display them in a beautiful way so that the customers may buy. They announce different prizes including cash, motorcycle and color television to customer.

9. To push new item


Sales promotion also encourages the sellers and channel members for sale of newly introduced products. So, they purchase new brand products from producers and urge or appeal the consumers to buy them.

10. To attract new channel members


Efficient new channel members are needed to sell any new product. Sales promotion encourages such new members to deal in such products. As a result, the market gets expanded and distribution management strengthened due to addition of new persons, channel-members or organizations. In this way, a competition among many channels members in selling products takes place through which the efficiency increases.
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Personal Selling: Types, Importance and Objectives of Personal Selling

Personal Selling

Personal selling is very important part of promotion mix. It is the eldest media of sales promotion. Although being old, this is the most popular media for sales promotion. So, all the organizations mostly use this media for sales promotion. Personal selling is, however, costlier than other factors of promotion mix. 
The task of convincing and persuading customers to buy products through personal contacting or face to face talks is called personal selling. In other words, the task of having direct contact and talks with the customers and encouraging them, assuring, giving confidence, etc. to buy product is personal selling.

The customers themselves may also come to the sales centers. Just the opposite, the seller may go to the customers' houses or offices. Demand should be created at the meeting / talks with the customers. The seller should also be able to convince the customers. As there takes place a dialogue between seller and customers, wrong concept of them towards the company / firm, if any, should be cleared off their mind. Besides, face to face talks between possible buyers, telephone talks, fax, e-mail, Internet etc. also become effective media in personal selling.

To be much clearer about personal selling, definitions of different writers and experts have been given as follows:
Prof. William J. Stanton has defined personal selling as, "Personal selling is the personal communication of information to persuade a prospective customers to buy a service or idea."

 

American Marketing Association has defined it as, "Personal selling is an oral presentation in a conservative with one or more prospective customers for the purpose of making sales."

 

Prof. Philip Kotler has defined personal selling as, "Personal selling is face to face interaction with one or more prospective purchasers for the purpose of making presentation, answering questions, and procuring orders."

 

The above mentioned definitions also make it clear that personal selling is the process of face to face talks and of persuading the customers to buy products, and as a result, receiving / procuring purchase order from prospective buyers. Personal selling is compulsory for the heavy machines and technical equipment including special products. In personal selling, the seller makes customers know about quality, utility, price, features etc. of the product. Similarly, the personal seller quenches the curiosity of the customers by giving logical and convincing answers to their questions. So, the need of personal selling is felt every time. In short, personal selling should be understood as the subject endowed with the following qualities and features.

1. Persuasion


In personal selling, the prospective customers are reassured. Personal seller stimulates the prospective customers to buy products.

2. Personal communication


Personal interactions may take place between customers and seller. Talks may also be held through telephone, fax, e-mail, Internet etc. Such exchange of information is called personal selling.

3. Selling process


Effective and goal seller should adopt certain process of selling goods. Indoor seller should complete the process such as drawing attention of the customers, politely welcoming, inquiring, presenting goods, solving customers' doubts, help them in selecting goods, giving chances for selection, selling additional goods and seeing off with respect. Outdoor sellers should complete the process such as prospecting, making pre-approach, and approach, display of product meeting objectives, close the sale and follow up about the goods or services.

Objectives of Personal Selling


Personal selling provides information to prospective customers about goods or services. In order to attract them towards ones' own goods or services, personal seller presents confidential as well as strong logics. Besides this, the personal seller gives convincing answers to the questions put forth by the customers and explains the quality, features, price, utility and importance of the goods to the prospective customers. Any curiosity, if expressed by the customers, is satisfactorily answered. The significance and objectives of personal selling are as follows:

1. Awareness of need


Personal sellers reach target markets for selling goods. They give detail information and explain clearly the feature, quality, price, utility, importance of the goods to the prospective customers and conduct different activities for persuading them to buy. Such activities, information and programs make customers feel need of the goods or services. As a result, they may take decision to buy the products / goods.

2. Solution of the problem


Seller reaches targeted markets, gives information to the prospective customers about the goods or services intended to sell. If necessary, product is also presented among them. After the presentation, the customers may raise problems about the goods. At that time the seller clearly, sincerely and convincingly gives answers with evidence about the way of solving the possible problems. For such activities, the sellers should present true and dependable records of the company. So, one of the main objectives of personal selling is to solve any problems if arise while using the products.

3. Persuading the customers


The targeted customers should be fully assured by the personal sale. The personal sellers should provide clear information about quality, features, price, utility, using methods etc. of the product to the customers. The possible customers should be converted to real customers from such information. So, personal selling aims to reassure all the customers about the product.

4. Two-way communication

The seller keeps direct contact with the customers of target market. In this way, the sellers and buyers may meet and have talks. In this way, while providing information, the sellers can also get some information about goods or services as a feedback. Two-way communication becomes possible between sellers and buyers through meeting, sales talks, sales display, public contact etc. This helps the company to form new market strategy. So, personal selling makes the two-way communication objective, which becomes beneficial to both sides.

Types of personal selling


Personal selling is very effective sale function. Such sale can also be done with different methods. It does not only make two-way communication about goods or services but also educates the customers. There are different types of sale function as mentioned below:

1. Indoor personal selling


The seller who sells goods or services living at certain place is called indoor seller. Such seller tries to sell his goods or services to different customers by establishing contact with them. Different types of customers enter the shop to buy various goods or different qualities. So, they should be impressed by attractive activities and they should make them buy the goods or services immediately. So, this function is very difficult and challenging. Special attention should be paid towards selling goods to the customers by identifying their needs and interest.

2. Outdoor personal selling

Identifying customers and by walking in different geographical regions and selling goods to them is called outdoor personal selling. Customers should be sought reaching several market segments. Such sellers should be clever, smiling, and smart and be able to establish relation with people. Besides, the seller should be able to make feel necessity of the goods, propagate new products and create demand of the goods. The customers should be able to get information about the quality, features, price, utility benefits etc. and procure purchase order and make arrangement for sale of goods. As such seller can have direct communication and contact with customers, any problem arisen should be promptly solved.

3. Sales representative


Big business forms or companies appoint their sales representatives to sell their products. Big firms / companies select clever sellers, who are experienced, educated and able to establish public relation efficient in business dealings, as their representatives. Such capable sales representatives can sell goods or services to different markets giving full satisfaction to the customers. Mostly manufacturers' sales representatives, wholesalers' sales representatives, retailers' sales representatives can be involve in selling. Such representatives are appointed to sell new goods, industrial goods and consumers' goods.
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Promotion Mix and Factors Affecting Determination of Promotion Mix

Promotion Mix

Promotion is an important tool of marketing. Promotion is used to provide complete information to consumers about goods/products or services. Mostly, consumers are requested to buy goods by marking them clear about quality, service and operation method. In other word, the way or the media of presenting proposal to
customers for buying goods or services is called promotion. This needs various elements. The task of operating such elements as a whole is called promotion mix. Various types of elements are needed. Promotion mix is to provide information about price, quality, feature etc. of the products to the target customers. For this, personal selling, advertising, sales promotion, publication, propagation should be made.

Promotion is related to the communication process. This function plays an important role to fulfill the objectives of company or organization. Personal selling is an important part of promotion. It encourages potential customers to buy goods or services. Seller may directly go to buyers or buyers may go to sellers. Sellers give information about goods, price, quality features etc. to the customers. Personal sale is actually a conversation between seller and buyer. So, the seller should be skillful in his / her activity.

Advertisement is also equally important in promotion. It provides ample information or message to the customers about goods. Message about goods can be disseminated to maximum customers at minimum cost. Different media can be used for advertisement. Audio video, radio, television, film slide etc. can be used for advertisement. Newspaper, magazines, books, pamphlets, etc. also can be used. Hoarding boards, poster, mobiles etc. can be used for advertisement.

Giving information about goods and organization without any cost is called propagation. This creates demands and plays important roles in heightening dignity of the organization. Nowadays, promotional media have become very popular in Nepal. Propagation can be made through publication, photography, press conference, speech writings etc. Propagation is a kind of promotional strategy by which information and messages can be disseminated without any cost. Request to social and political persons also can be used for sales promotion.

Short term motivation to the potential customers for buying goods or services is called sales promotion. It encourages them to buy goods immediately. It becomes more effective if personal sale and advertisement help. Trade fair, exhibition, decoration, free sample, gifts, coupon, discount, credit facility etc. are provided. Attractive packaging also advertises by itself and encourages customers to take buying decision.

Main Elements of Promotion Mix


Factors Affecting Determination of Promotion Mix


Promotion mix consists of five elements / factors. Promotion mixing is very complicated strategic task. Proper promotion mix should be prepared to conduct marketing successfully. Promotion mix is directly affected by promotion objective, promotion budget, nature of market, product life cycle, marketing promotion strategy. They are mentioned as follows:

1. Promotion objective


One of the main factors affecting determination of promotion mix is promotion objective. If the customers are to be given clear information and make them aware about the goods intended to sell, special emphasis should be given on advertisement and propagation. Similarly, if the promotion objective is to make potential customers believe and give assurance to them, personal selling and advertisement become important. If the objective of promotion is to get order / demand, personal selling and sales promotion should be very active. If the promotion objective is to remind the customers, advertisement becomes more important. If the promotion objective is for brand loyalty, advertisement and propagation become important.

2. Promotion budget


Sufficient budget should be arranged for promotional functions. In the lack of budget, promotional works cannot be conducted. So, promotion budget also affects promotion mix determination. A lot of budget is needed for personal / individual selling and advertisement. If sufficient budget has been allocated for advertisement, highly responsive personal sale can be conducted, long term advertisement policy and high amount of budget is also not needed for publicity. It needs only good opportunity for propagation. This makes it clear that promotional activities can be determined on the basis of promotional budget. In this way, the fixed / prescribed budget affects promotion mix.

3. Nature of market


Nature of market also affects promotion mix. If the size of targeted market is very small one, way / method becomes effective, and if its size is big, other way / method becomes effective. If the targeted market is consumers' market, advertisement and sale promotional activities should be conducted. If it is industrial market, personal sales and promotional sale should be conducted. Similarly, if the targeted market is very small and is limited in a certain geographical area, personal selling and advertisement should be emphasized. If the market is big, national and international advertisement and business promotion should be emphasized.

4. Nature of product


Nature of product also affects the determination of promotion mix. Products may be consumer target or industrial. Their information cannot be effectively communicated through same activities. Generally, advertisement becomes important for consumer goods whereas personal selling becomes important for industrial goods. Similarly, advertisement and sale promotional activities become important for the low priced goods, whereas personal selling and local advertisement become important for high priced goods. In the same way, personal selling and propagation should be given emphasis for special goods.

5. Product life cycle


Different stages of product life cycle also affect promotion mix. Every product goes through different four stages after it has been produced. At the introduction stage of goods / products, advertisement and propagation should be given emphasis. After the product enters growth stage, only advertisement becomes sufficient. Similarly, careful attention should be paid to the product at its mature stage. If the product has entered the last stage of its life cycle, personal selling, sales promotion and propagation are needed. Whatever tools can save products, the same should be used for promotion.

6. Promotion strategy


There may be several strategies of promotional activities. They also affect promotion mix. They are mentioned in short as follows:

i. Push strategy

The producers can push their products using their force. In this strategy, products are pushed to the final consumers through distribution channel. Personal selling and trade promotion become important.

Pushing Strategy

ii. Pull strategy

In this strategy, the customers demand goods from retailers. Retailers demand from wholesalers and wholesalers demand from producers. For such strategy, advertisement becomes very important.

Pulling Strategy


iii. Interpersonal strategy

Interpersonal strategy is also one of the strategies. In this strategy, personal selling becomes more important. So, this tool of promotion should be adopted.

iv. Mass communication strategy

If the promotion strategy is in favor of mass communication, sales promotion should be given special importance. Similarly, advertising and publicity are also equally important.

Factors Affecting Promotion Mix Determination

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