Special Studies Marketing

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WHAT IS SALES PROMOTION?
Sales promotion refers to many kinds of incentives and techniques directed

towards consumers and traders with the intention to produce immediate or
short-term sales effects.
DEFINITION
“Sales promotion includes incentive-offering and interest-creating

activities which are generally short-term marketing events other than
advertising, personal selling, publicity and direct marketing.
The purpose of sales promotion is to stimulate, motivate and influence
the purchase and other desired behavioral responses of the firm’s
customers.”
MORE ON IT...
Sales promotion offers a direct inducement to act by providing extra worth over
and above what is built into the product at its normal price. These temporary
inducements are offered usually at a time and place where the buying decision is
made. Not only are sales promotions very common in the current competitive
market conditions, they are increasing at a fast apace. These promotions are
direct inducements. In spite of the directness, sales promotions are fairly
complicated and a rich tool of marketing with innumerable creative possibilities
limited only by the imagination of promotion planners. Sales promotion is often
referred to by the names of ‘extra purchase value’ and ‘below-the-line selling’.
Used to achieve short-term sales
Sales promotion is a separate and distinct element in the promotion mix and is
an important and powerful tool of marketing. The aim of sales promotion is
goal-oriented to achieve sales/marketing objectives which are short-term and
immediate. Generally, sales promotion is not used to generate long-term results
or sales in the future, but rather to generate sales results now.
Example: promotions mostly say “offer lasts till…” which is aimed at increased sales
till that date. This would induce trials, and even the existing users would
increase consumption.
Becoming too common
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Sales promotion has been traditionally viewed as a non-recurrent selling

activity. However, this does not portray the present market conditions where
frequent and repeated sales promotion programmes have become necessary to
maintain business in many product categories. The reality is that sales
promotion has become an all too recurrent activity.
Today we find companies in almost all sectors offering some sort of a promotion
scheme. These sectors range from automobiles to beverages, from financial
services to foods, from household durables to services, from household products
to business products, from personal care to textiles and apparel.
Here are examples of each:
• Automobiles: Maruti Suzuki offered a 22-carat, 10gm Tanishq gold coin free and
lots of other exciting prizes. Other prizes include 50 Rs. 50,000 Tanishq gift
vouchers, 10 Rs. 1 lakh Tanishq gift vouchers and a grand bumper prize of 1kg
gold with every new Maruti 800 or Omni.
• Beverages: Taj Mahal tea offered prizes on filling the coupon present in the ad
and mailing it with a flip top of Taj Mahal tea 100, 250 or 500g pack. 1st prize:
diamond set worth Rs. 1,00,000, 2nd prize: diamond set worth Rs. 50,000, 3rd
prize: Taj Mahal watches.
• Financial services: Tata finance offered Free Tata Finance credit cards with
every car financed.
• Foods: Nestle offered Free 50g Johnson's baby soap with every 400g Cerelac
pack.
• Household durables: Samsung offered a free book on Indian recipes and free
cookery classes. Upto Rs. 2000 off & Borosil dishes worth Rs. 510, on buying
Samsung Microwave Ovens.
• Services: CMC Computer Education offered a set of 3 CDs of Brittanica

Encyclopedia worth Rs. 1995 free on enrolling for DST & eDAST.
• Household products: Kodak Express offered a Dil Chahta hai T-shirt free with
any Kodak camera.
• Business products: Godrej offered prizes like a Ford Ikon car, Godrej air
conditioners, Godrej auto clean washing machines and more on purchase of
Photocopiers and Digital Multi-function products.
• Personal care: Fem had an offer of save Rs. 79 on buying a 1-litre pack of Fem
soft gentle soap .

• Textiles and apparel: Bombay Dyeing had the Bombay Dyeing Lao Diamond
Pao Offer. 6990 diamonds to be won , on buying Bombay Dyeing products worth
Rs. 300 and scratching the card available.
The range of tools and techniques of sales promotion includes discount coupons,
free samples, contests, games, premiums, sweepstakes, special pack allowances,
trade fairs, cooperative advertising, continuity programmes, demonstrations,
exchange offers and many others. Sales promotions add value to the product or
service which is extra and not built into the product or service. Not only do
these promotions supplement the effects of advertising, personal selling and
direct marketing but can also create a sense of urgency in customers to buy now
because the offer is available only for a limited period. This shows that sales
promotions have a direct effect on the customers’ purchase behaviour.
Many types of sales promotion require participation of customers who are

encouraged to take some action and invest their time and effort.
For example, contests and sweepstakes require some effort on the part of the customer;
coupons require clipping, saving and redemption; for claiming the rebate/ refund, the
customer is required to send the proof of purchase. In certain types of promotions such
as stock display contests or sales contests, the participation of dealers is required.
But sales promotions are not always short term. It would be reasonable to say
that promotions are reasonably short term because in many product categories,
extra discounts continue on a regular basis. Likewise, some product brands
always contain in-pack premium.
For example, each pack of Bharosa agarbatti contains either a stainless steel glass or
a small bowl.
Filmfare magazine has a free pack of some product along with it almost all the time.
This is a strategic decision of giving extra value to customers at a reasonable price, thus
making it much more attractive to buy. This is possible because it has the strong
financial backing of the Bennett & Coleman group.

Writing about sales promotion tools, Prof. Philip Kotler observes – “they have 3
distinctive characteristics.”
1. Communication: they gain attention and usually provide information

that may lead the customer to the product.
2. Incentive: they incorporate some concession, inducement, or contribution
that gives value to the consumer.
3. Invitation: they include a distinct invitation to engage in the transaction
now (offer valid till …or till stocks last)
Major users of sales promotions are marketers of soaps, detergents, toiletries,

soft drinks, toothpastes, tea, coffee, footware, textiles, readymade garments,
consumer durable goods, music systems, autos, televisions, washing machines,
microwave ovens, refrigerators, magazines and many other household items. In
fact the list of product categories using sales promotion is ever-increasing, no
matter what the product category, it could be staples, impulse goods, emergency
goods shopping goods, speciality goods, unsought goods, industrial products,
or different types of services.
Sales promotion is now established as an important and increasingly respectable
element of the marketing communication tools. Sales promotion expenditures
are increasing dramatically, and economic recession is most likely to fuel this
trend further.

DIFFERENCE BETWEEN ADVERTISING AND SALES PROMOTION
Advertising Sales Promotions
By using a variety of persuasive appeals, it Besides giving reasons in the form of

offers reasons to buy a product or service. different appeals, they offer incentive to
the consumers to buy the product or
service now.
Appeals are emotional or functional in Appeals are rational
nature
Time-frame is long term Time frame is short term
The primary objective is to create an To get sales quickly or to induce trial.
enduring brand image
Indirect and subtle approach towards Direct in approach to induce consumers to
persuading customers to buy a product or buy a product or service immediately by
service temporarily changing the existing price-
value relationship of the product or
service.
But both advertising and sales promotions go hand in hand. Both are very essential to
achieve success. Both are complementary to each other.
THE ADVANTAGE OF ‘ADVERTISING FOLLOWED BY PROMOTION’ OVER

‘ONLY PROMOTION’
Promotion alone
100
P P P
P = promotion

Advertising then Promotion

sales
150
A P A P A P A
RELATIVE COMMUNICATION STRENGTHS OF ADVERTISING AND

PROMOTION
A = advertising
P = promotion
Advertising
Category Brand Brand Brand purchase Purchase

Need Awareness Attitude Intention Facilitation
C
F
B
Promotion
The width of arrows denotes the extent of effectiveness

CFB = consumer franchise building

REASONS FOR RAPID GROWTH OF SALES PROMOTION
There are a number of reasons that are favourable to the growth of sales
promotion:
♦ Increasing Competition
The air of change is gaining momentum after the introduction of economic

liberalisation.Due to increase in competition, companies are finding it
increasingly difficult to compete on quality. They are therefore resorting to more
and innovativemethods of sales promotion.
To break away from the clutter, Samsung introduced the ‘phod ke dekho’ and ‘phir se
phod ke dekho’ offers, which helped increase sales.
♦ Customers Have Become More Price Sensitive
This increased price sensitivity is a direct result of rampant inflation. Economic

recession is likely to fuel this trend further, as consumers and dealers become
more sensitive towards prices.
The case of Akai TV presents an interesting example. This television started introducing
quite attractive deals, one after the other and gained a substantial share of the CTV
market. Continuous promotions have affected the price perceptions of consumers across
the product category, and today the situation is such that customers in general look or
wait for promotional deals on their preferred brands of CTV. They are not much moved
by the advertising that might extol about the highly advanced features and quality of
most brands. They usually consider buying CTVs on price cuts.
♦ Sales Promotions Generally Create An Immediate Positive Impact On

Sales
Advertising, personal selling and other methods of promotion produce slower

sales response compared to sales promotion. Sales promotions are mostly for
short duration, for a specified period, leading to a sense of urgency in
consumers to buy now. This creates an immediate positive impact on sales. With
careful planning, it would not be difficult to measure the impact on sales
volume and profit, and see the consequences of running the promotion even on
weekly or daily basis.
Godrej offered a promotion scheme on its washing machines by cutting down the price
from Rs. 14,999 to Rs. 13,000. It also gave away a free VIP suitcase, and offered 0%
interest loans. Sales went up by 70% shortly.

♦ Products have become more standardised
In many product categories, there is a proliferation of brands; many of them are

line extensions and me-too brands. Most brands are being perceived by
consumers to be more or less similar within a given price range because of the
inability of manufacturers to develop truly differentiated products. Under these
circumstances, advertising messages are unable to strongly influence the
consumers’ perceptions and create brand franchise. As a result of these
perceptions of similarity among brands, marketers have no way but to compete
on the basis of extra benefit offered through sales promotion. Competing
companies struggle to capture market share by using every tool likely to bring
sales success.
§ Standard Chartered had a scheme of Win Rs. 1 lakh on applying for a Standard
Chartered credit card .
§ HSBC came up with a scheme of Upto 25% off at select restaurants on using an
HSBC credit card .
♦ Consumer Acceptance
As competition intensifies and promotions proliferate, consumers have learnt to

earn the rewards of being smart shoppers. Over a period of time, they have also
learnt that brands on promotion are not necessarily of lower quality.
Woodland has a scheme of upto 50% off on Woodland shoes and apparel.
This learning based on experience, gets transferred to other product categories
as well. Consumers have learnt that promotions are being extended to many
product categories where such promotions were unheard of.
♦ Expectations Of Price Decrease
With the entry of many different brands of consumer durable products in the
same product category, consumers anticipate that the prices of durable goods
will come down. This encourages them to postpone their purchases. To speed
up the purchase in this segment of consumers, sales promotions are an effective
and attractive method. Consumers evaluate the incentives associated with their
purchase decision and are motivated to act now, rather than wait for the
anticipated decrease in price. The marketers should ensure that the extra benefit
is attractive enough to create a sense of urgency in consumers.
Samsung offers upto Rs. 8,000 off on exchanging an old refrigerator for a new Samsung
refrigerator.

♦ Advertising Has Become More Expensive And Less Effective
All the advertising media have become quite expensive. Audio-visual medium,
which is considered as the most effective for short-duration ads, may cost in
excess of Rs. 1 lakh for a 10 second exposure during prime time. In many cases,
consumers have reached a point of boredom due to excessive advertising on TV.
Some consumers even consider advertising as an intrusion into their privacy,
leading to zapping (surfing channels). Firms with small budgets cannot compete
with big companies which spend huge sums of money on advertising. For these
small budget firms, sales promotion is a more cost-effective promotion method
to produce sales results. A firm that wants to introduce a personal care non-
durable consumer product quickly and where the consumers’ personal usage
experience is more important, a sample drop can be quite effective.
Gillette is offering a 4 gm. sachet of Gillette series shave gel concentrate free with every
7 o clock super platinum razor.
♦ Trade Has Become More Powerful
Retailers and wholesalers have become powerful and find themselves in a

position to demand extra facilities from the companies. They do not hesitate to
play off one manufacturer against the other. In bigger cities, retailing has
become more sophisticated and competitive. For example, the shelf-space in any
retail outlet is limited. So every manufacturer wants the prime shelf-space in the
retailer’s showroom. This created more demand for prime positions in the retail
outlets than what is available, and the retailer cannot oblige every company by
allocating prime shelf-space. Companies introducing new products are often
under pressure to get a prominent shelf-position to make the product
attractively visible. Channel members demand more incentives to get the
desired results. Manufacturers do not seem to have any alternatives but to
concede to their demands, keeping in view the competitive market conditions.
§ Pepsi offers silver coins to their dealers stocking Pepsi cases during Diwali season.
And the promotions offer differs across dealers.
§ Lalwani Dealers (Chembur) of consumer durables are offered tour schemes to Goa
or gold and cash incentives in order to push sales.
♦ Emphasis On Sales Volumes
Towards achieving the long-term profit goals, manufacturers try to attain high
sales volume. Brand managers and product managers find themselves under
pressure to achieve short-term sales results for the sake of their careers.
Compared to any other promotional method, sales promotion is a more effective
method to generate short-term sales volume. Sales promotion has also become

more acceptable to top management and the incentives to management are tied
up with sales volumes. As competition intensifies, managers generally hesitate
to devote more time and resources to building up their brands by sacrificing the
short-term results.
♦ Sales Promotions Maximise Profits
A number of economic theories conclude that a company can maximise profits

by using sales promotion. Such promotions can permit price discrimination by
allowing the brand to compete in 2 or more different market segments. Sales
promotion may allow a premium brand to compete with a lower tier brand
among price sensitive consumers. For example, a premium band of toilet soap
may be on promotion in some price sensitive markets, while in the remaining
markets it is sold at its normal price.
♦ Introducing An Element Of Interest
There are a number of promotions which are often called interest promotions.
Some of the more popular interest promotion techniques are samples, contests,
and sweepstakes, free premiums and mail-in premiums. These promotions
create an element of interest and excitement, and consumers enjoy these and
response enthusiastically to such contests and sweepstakes, etc.
Fevicol had recently launched a contest in which one had to choose 3 Fevicol ads which
they considered the best, and then complete a slogan I like Fevicol ads because
♦ Impulse Buying Is Increasing
The number of marginal customers is increasing. Displays at the point of

purchases lead to impulse buying by consumers, more so if the items on display
are not expensive. There is a popular saying in Hindi, “jo dikhta hai, voh bikta
hai.”
This strategy is followed by soft drink majors like Pepsi and Coke on a large scale. They
pay huge sums of money to keep their products in front so that they are visible.
These are also known as display promotions
♦ Sales Promotion Specialists Are Available
As a result of economic liberalisation, the number of management institutions

has increased. This has lead to the availability of specialists, who are not only
well paid but can handle this specialised work more efficiently in the current
market conditions, where sales promotion has become more important.

♦ Excess Stocks
Because of increasing number of brands, it is difficult for manufacturers and

dealers to anticipate future sales. This, at times, leads to excessive inventories,
and the quickest way to clear that, is to go for sales promotion.
Footwear companies like Bata, Woodland, etc regularly offer around 50% discount on
their products.
ADVANTAGES OF SALES PROMOTION
Sales promotions have a significant effect on the behaviour of consumers and

trades people. Such promotions can bring in more profits for the manufacturers
because they permit price discrimination.
♦ Price discrimination
Producers can introduce price discrimination through the use of sales

promotions. They can charge different prices to different consumers and trade
segments depending on how sensitive each segment is to particular prices.
Coupons, special sales events, clearance sales and discounts are examples to
explain the phenomenon.
Often such price discrimination are offered in specific cities in the country,
§ Bajaj Auto Ltd. started the scheme on 20th august 2001, where by if you buy a Bajaj
Spirit two-wheeler you get Rs.3000/- off, valid only in Ahmedabad.
Price concessions are also offered in trade fairs and exhibitions.

§ The Grand Computer Carnival organised by HCL Infosystems Ltd. gives many offers
and discounts in their exhibitions.
§ The Strand Book Exhibition sells books at prices lower than the original.
Such price discriminating sales promotions that enable consumers and traders to
pay less in certain market area or stores usually bring in more contribution than
if one price is charged to all. Such price discrimination also held in adjusting to
fluctuations in demand and supply situation without affecting any changes in
the list price.
♦ Effect on consumer behaviour
As sales promotions are mostly announced for a short period, customers may
feel a sense of urgency and stop comparing the alternatives. They are persuaded
to act now rather than later.

With every 500g pack of Tang, you get a free Tang glass. Offer valid only till stocks last.
Company/ Applicable Period

Date Offer Eligibility
Brand In of Offer
On a 75g pack of
25 Pears Oil Clear
Till Sep
August, Pears Rs. 5 off. Soap and Delhi
15, 2001.
2001 presenting the
cutting of the ad.
25
Free Sanyo digital camera With every LCD Select Till Sep
August, Sanyo
VPC-SX560 worth Rs. 40,000. Projector. dealers only. 30, 2001.
2001
25 On buying Kenstar Limited
Select states
August, Kenstar Price off. Tumble Top period
only.
2001 washing machine. only.
A 22-carat, 10gm Tanishq
gold coin free and lots of other
exciting prizes. Other prizes Offer not
25 With every new
Maruti include 50 Rs. 50,000 Tanishq valid in the Upto Sep
August, Maruti 800 or
Suzuki gift vouchers, 10 Rs. 1 lakh state of 15, 2001.
2001 Omni.
Tanishq gift vouchers and a Tamil Nadu.
grand bumper prize of 1kg
gold.
Till Aug
25 31, 2001
On buying two
August, Apollo Travel bag free. Bangalore or till
radials.
2001 stocks
last.
Till Aug
25 31, 2001
On buying four
August, Apollo Personal stereo system free. Bangalore or till
radials.
2001 stocks
last.
In our over communicated society and because of selective attention, it is not

uncommon to ignore many advertisements. Sales promotion deals such as
discounts, debates, coupons, premiums, etc also increased the attention getting
power of advertisements and convey the advantages and benefits of the brand,
including price information. By using promotions, marketers can reach the deal
prone customers and encourage brand switching. Consumers, who buy on
promotion deals, consider themselves as intelligent and smart shoppers.
♦ Effect on trade behaviour
Short-term promotions present an opportunity and encourage dealers to forward

by. This forward buying ensures that retailers won’t to go out of stocks. As
dealers have more than the normal stocks, they think it advisable to advertise in
local media, arranged displays and offer attractive promotion deals to
consumers. These actions help in increasing the store traffic.

§ Retailer promotion: Buy Cadbury s products worth Rs.3000/- and get any 30
chocolates worth Rs.5 each free.
§ Buy a box of Munch and get 1 Munch free.
The aim is to speed up consumer purchasing from their outlets. Point of

purchase displays attract customers, serve as reminders and lead to impulse or
unplanned purchases. More customers get exposed faster to new product
introductions and retailers perceive less risk in stocking the new products. Some
customers by new brand and if satisfied, may become loyal users and repeat
purchasers.
Regional Differences
The South is generally characterised by greater degree of going out and people tend to
drink outside the house. The Tamilian, consumer in particular, is value oriented, rational
and looks up to film stars, while the Keralite is more international in his outlook. The
Bangalorean is as Cosmopolitan as his Mumbai or Delhi counterpart."
That sort of diversity, believes Coca-Cola, calls for a corresponding variety in
promotions. The place to attract is the retail zone. Coca-Cola recently launched a
promotion called ' world of Coca-Cola' covering Chennai in Tamil Nadu and Bangalore
and Mysore in Karnataka. It was a value deal, aimed at the consumer disposed towards
global- style outings. The consumer pays Rs 20 along with a label of a 500 ml of PET
bottle to get a card which entitles him to gifts and discounts at 29 outlets, including those
of global chains such as TGI Friday and Baskin and Robbins this, in these cities. About
four years ago, Pepsi had a similar promotion with its Pepcards. This, however was on a
national level, while the Coca-Cola promotion is South based build retail level activity
matters more than it does in the North. The primary aim is to help the retail raise
volumes.

DISADVANTAGES OF SALES PROMOTIONS
While sales promotion is a powerful and effective method to produce immediate

short term positive results, it is not a cure for a bad product or bad advertising.
In fact, a promotion is speed up the killing of a bad product. A consumer may be
motivated to try to new products because of the incentive but after this the
product itself must take over.
Pepsi Aha launched a sales promotion campaign for its launch, though the promotion
was effective, ineffective advertising and publicity led to the downfall of the brand.
♦ Increased price sensitivity
Frequently promoted brands in the product category, especially on the basis of

price, make consumers and traders more price sensitive not only for the
promoted brands but for other brands as well in the same product category.
Consumers wait for the promotion deals to be announced and then purchase the
product. This is true even for brands where brand loyalty exists. Customers
wait and time their purchases to coincide with promotional offers on their
preferred brands.
The case of Akai TV presents an interesting example. This television started introducing
quite attractive deals, one after the other and gained a substantial share of the CTV
market. Continuous promotions have affected the price perceptions of consumers across
the product category, and today the situation is such that customers in general look or
wait for promotional deals on their preferred brands of CTV. They are not much moved
by the advertising that might extol about the highly advanced features and quality of most
brands. They usually consider buying CTVs on promotion majorly based on price cuts.
♦ Quality image may become tarnished
If the promotions in a product category have been rare, or the product happens
to be of high involvement category, the promotions could have a negative effect
about its quality image. Consumers may start suspecting that perhaps the
product has not been selling well, the quality of the product is true compared to
the price or the product is likely to be discontinued because it has become
outdated.
Akai a well-known brand of colour television that remained perpetually on sales

promotion. So after a point of time a good number of consumers started suspecting its
quality and almost no one is prepared to call it a high quality brand.
Because of competitive pressures, now almost all brands of colour television

period market are available on one or the other promotional deal and consumer
perceptions are that almost all the brands have same quality and performance in

a price range. Even a top-of-the-line brand like Sony having technological edge,
has occasionally announced promotional deals because of competitive pressures
as promotions have become common in the category.
In the talcum powder category Dermicool started the sales promotion of buy one get two
free which diluted its image in the minds of the consumers.
♦ Dealers forward by and divert stocks
In case of deals for the trade, many dealers forward by, in excess of their
inventory requirements. This is particularly happens if a product is low bulk,
much in demand and the inventory holding costs are favourably low. This is
true both for wholesalers as well as retailers. Forward buying of excessive stocks
on deals or quantity discounts can lead to diversion of some of the stocks in non-
deal areas. Forward buying of excessive stocks on deals or quantity discounts
can lead to diversion of some of the stocks in non- deal areas. Wholesalers and
retailers do not hesitate in selling these excess stocks in non- deal areas on prices
that are less than the list price, but keeping some reasonable margin for
themselves. This is likely to have a negative effect on price discrimination efforts
of the company as dealers and those areas would not be buying even the normal
requirements from the company.
♦ Merchandising support from dealers is doubtful
One of the trade promotions tool is to offer promotional allowances to trade

people to motivate them to provide merchandising support and to pass on some
benefit to consumers. This generally is the condition attached with such
promotional allowances. In many cases, the dealers do not cooperate in
providing the merchandising support nor do they pass on any benefit to
consumers. The retailer might not be willing to give support because he does not
have the place, or the product does not sell much in his shop, or may be he thinks
the effort required is more than the commission/benefit derived.
♦ Short-term orientation
Sales promotions are generally for a short duration. This gives a boost to sales
for a short period. This short-term orientation may sometimes have negative
effects on long-term future of the organization. Promotions mostly build short-
term sales volume that is not maintained. Heavy use of sales promotion, in
certain product categories, may be responsible for causing brand quality image
dilution.
A dealer in second-hand cars had to close shop because he was able to attract customers
only during heavy promotions. The investment made on attracting customers was not

showing any continual returns.
Promotions do affect the behaviour of consumers, but not necessarily in a

positive manner. David Ogilvy's remark about promotions is interesting, In 1981,
United States manufacturers spent 60% more on promotion than on advertising and
distributed 1,024,000,000,000 coupons. Bloody fools.”
The argument given in favour is that companies should develop superior

products or services which are better than competitors and consumer should be
convinced through appropriate and focused advertising about the superiority of
the product and its image.
This will result in lasting brand identities reflecting consumer values. Then there
will be no need to offer any extra benefits; only the lasting brand image will keep
customers loyal to the brand.
PULL AND PUSH STRATEGIES
Sales promotion decisions are significantly affected by whether the company

decides to do to pull or push strategies to accomplish its objectives. Such a
decision may require a little or a lot of cooperation from resellers. The
requirements to implement one strategy might be little more than to just stock
the product by the retailers. The other strategy may demand more participation
from resellers such as the ability to explain to the consumers as to how a product
works.
In case of using a pull strategy, marketing efforts are directed at the ultimate
consumer and consumer promotions such as consumer contests and
sweepstakes, rebates, coupons, free samples, consumer premiums, etc are used.
If this strategy is also chosen to include advertising, there are large advertising
expenditures. The objective of such promotional efforts would be to create
sufficient consumer demand to pull the product through the channels, that is the
consumers are encouraged to demand the product from retailers who in torn
place orders with wholesaler or manufacturer to meet the consumer demand.

PULL
Manufacturer
Flow of
Wholesaler promotion:
sales promotion
Flow of demand and advertising
Retailer
Consumer
§ Bajaj Auto Ltd. offered a scheme of taking home a scooter at Rs 999 was a sales
promotional offer communicated through effective advertising and was essentially a
pull strategy.
§ Taj Mahal
On filling the coupon present in the ad and mailing it with a flip top of Taj Mahal tea
100, 250 or 500g pack, the customer could win amazing prizes. Prizes included 1st prize:
diamond set worth Rs. 1,00,000, 2nd prize: diamond set worth Rs. 50,000, 3rd prize: Taj
Mahal watches. Offer was available in Punjab, Delhi, Chandigarh, Mumbai and Pune
from 24th august to 25th September.
This strategy may require little promotional efforts from the resellers except to
stock input the product on shelves.
A pull strategy is appropriate when
• The product demand as high.

• It is possible to differentiate the product on the basis of real or emotional
features,
• Brand consumers show high degree of involvement in the product
purchase,
• There is reasonably highly brand loyalty and consumers make brand
choice decision before they go to the store.
If a firm decides to use push strategy, its efforts are directed at resellers and the
manufacturer becomes very dependent on their personal selling abilities and
efforts. The promotional efforts are focused at pushing the product through the

distribution channels; the resellers may be required to display, demonstrate and

offer discounts, to sell the product. The communication to resellers is generally
through trade circulars or the sales force.
PUSH
Manufacturer
Flow of promotion: trade

Wholesaler deals advertising,
Flow of personal selling.
demand
Retailer
Consumer
Push strategies generally appropriate for product categories where there is low
brand loyalty and many acceptable substitutes are available in the market. It
may also be suitable for relatively new products or when the brand choice is
often made in response to displays in the stores, the product purchase is
unplanned or on impulse and the consumer is familiar and has reasonably
adequate knowledge about the product. Manufacturers, who cannot afford to
engage in sustained mass advertising, often use push strategy and offer effective
incentives to dealers.
Retailer promotion: Buy Cadbury’s products worth Rs.3000/- and get any 30 chocolates
worth Rs.5 each free.
Through this offer the company is pushing its product to the retailers and now that the
retailer has enough incentive the retailer stocks more and thus it becomes essential for the
retailer to push the product to the consumers.

PULL AND PUSH
Manufacturer
Wholesaler Flow of
promotion mix
Flow of
demand
Retailer
Consumer
Pull promotions Push promotions Push promotions

(Manufacturer to (Offered to trade) (Offered by
consumer) retailer)
Sampling Discounts Price cut

Coupons Display allowance Free goods
Price packs Advertising Premiums
Rebates allowance Displays
Continuity programs Free goods Feature advertising
Contests Contests Quantity discount
Sweepstakes Trade coupons Clearance sale
Tie-in promotion Quantity discounts
Financing incentives
Special events
Premiums
Bonus packs
Exchange offers

"Product life cycle and pull or push strategies"
It is quite important for brand managers to analyze and identify the stage of a
particular brand in its life cycle before deciding about using sales promotion.
During the stage of product introductions, a product requires different sales
promotional tactics.
Likewise, during the product growth stage, its maturity and the decline stages,
the sales promotion tactics required are likely to be quite different. Promotional
strategies are also likely to be affected for different non-durable and durable
products. Also important in the development of promotional strategy would be
the target audience is towards whom the sales promotional messages would be
directed.
♦ Introduction stage
When the product is being introduced, the major objective is to increase the trial
rate and distribution of the product. For increasing trial sampling, coupons,
demonstration which are all pull promotions, can be used. To make the product
available in distribution channels, it may become necessary to use some kind of
incentive scheme for the resellers to encourage them and minimise their risk
associating stalking a new product. Manufacturers can offer display allowances
to resellers to make the product highly visible. There could be liberal guarantees
to take back the stocks, if unsold, to reassure the trader. These are all push
promotions. For most new products, it would be difficult to be successful
without pull promotions. In fact when new products are introduced, much more
emphasis is given to pull rather than push promotions.
§ Fair and lovely is introducing the Fair &Lovely dark circle remover crème by having
an introductory offer Rs10 off which will be available through the coupons that are
distributed with newspapers like the Times of India.
§ Maggie Chinese noodles was launched in February 2002

Objective- to launch Maggi Chinese noodles, create awareness amongst the target
audience and induce trials
City-Delhi
Strategy- an LCV attractively covered with Maggi Chinese noodles branding was
used for the road show. Dragon cut outs and a sales person dressed as a Chinese chef
were used to highlight the Chinese aspect. Activities around it included quizzes and
fun games like make the longest noodle out of plasticine. Sample packs of Maggi
Chinese Noodle, Maggi/Nestle T-shirts and caps were given out as prizes. This

activity was conducted over a period of 30 days in major shopping malls, schools,
colleges and hotspots in the city. The response of this was overwhelming.
♦ Growth stage
In this stage, the dominant objectives are to expand the market for increasing the
number of new customers who would try the product for the first time and to
encourage the repeat purchase by those who have already tried the product.
Another important objective is to expand or at least maintain the distribution.
For increasing trial, pull promotions are appropriate however as the trial rate
increases free samples become quite an expensive proposition. To encourage
repeat purchase by consumers, in pack or on-pack coupons can be used.
Samsung had launched the Phod Ke Dekho offer last Diwali between October 15 and
November 20, 2001, to optimise sales of its consumer electronics and home appliance
products during the festival season, which resulted in tremendous sales. Samsung's sales
during Diwali grew by over 28 % over last year's corresponding period and closed the
period with sales of Rs 275 crore. While Samsung's CTV sales grew by 46%, refrigerator
sales grew by 25% and microwave ovens by 52%.
Due to the success of this promotional scheme the Samsung "Phir Se Phod ke Dekho"
Consumer Offer, valid between October 1~November 15, 2002 had been reintroduced by
the company to optimize sales.
Promotion:
The Phir Se Phod ke Dekho Consumer Promotion has all the excitement packaged in a
coconut which the customer handpicks on purchase of a Samsung product One Sureshot
Silver Pure Coin and Exciting gifts for Lucky winners. In addition to the Silver coin, each
coconut has a Cricket bat shaped key chain which has the gift engraved on the Bat, if the
customer has won a Gift. Gifts worth Rs. 15 Crores are being given to customers as part
of the Promotion Tickets to South Africa for World Cup 2003; Samsung products like
VCD Players, CD Yepp players, Vacuum cleaners, Mobile Phones, DVD Players, Key
phones; Anil Kumble memorabilia and VCD set, Braun Hand Blender and Adidas Team
T Shirt. In addition to participating at the Samsung Phir Se Phod ke Dekho Consumer
Offer, the customers of select Samsung hi-end Consumer Electronics products are also
entitled to a Gift Voucher worth Rs.2500 from Tanishq, which can be redeemed at any
Tanishq outlet. The Company is spending Rs. 20 Crores on this Promotion.
This would also help in converting those customers who have already tried the
product into regular users of the product. Another tool of sales promotion that
can be used is to offer bonus packs containing additional quantity at the same
price as an incentive to encourage repeat purchase. To expand the distribution,
push promotions such as different types of discounts, free goods that increase
the profitability of the trade, can be used.

♦ Maturity stage
When the product is in maturity stage, many similar brands are available to
customers. Due to price discounts or other extra benefits, consumers often
switched brands. This phenomenon of brand switching is more common if the
product category happens to be one of low involvement. The sales promotional
strategy in this stage can focus on attracting maximum number of brand
switchers, reward and reinforce the loyalty of regular users and use more of
push promotions to build inventories with resellers. Many tools of sales
promotion such as premiums, price discounts, extra goods, displays, dealer
contests, feature advertising become important.
§ CMC Computer Education

On enrolling for DST & eDAST. A set of 3 CDs of Brittanica Encyclopedia worth
Rs.1995 free.
§ Indian Airlines frequent flyers programme where you get discounts on frequent
visits, get hotel stays free, credit facility etc.
Generally a combination of pull and push promotions prove more effective

during maturity stage of a product life cycle. The market share of the brand is an
important factor in gaining the support of resellers.
♦ Decline stage
Survival of the brand often becomes more important during decline stage.
Another important objective is to maintain distribution. Sales promotions that
help in generating sales volume become quite important. Resellers, in general,
are not a tall enthusiastic about declining brands and for this reason we do not
show any kind of interest in promoting them. Because of this negative factor,
manufacturers use pull promotions. In many cases this becomes a game of
endurance for marketers.
Bombay Dyeing
The Bombay Dyeing Lao Diamond Pao Offer
On buying Bombay Dyeing products worth Rs. 300 and scratching the card available,
you would be eligible for a prize. There were 6990 diamonds to be won.

INITIATORS AND AUDIENCES FOR PROMOTION
Manufacturer
(Trade promotion) (Sales force promotion)
Sales force
(Consumer promotion)
Distributor
(retail promotion)
Consumer
= Initiator of promotion
= Audience for promotion
There are different groups who might be a target of sales promotion; consumers, trade
and the sales force. Sales promotions originating from manufacturers may be directed at
consumers, resellers or both. Simultaneously, the manufacturer may also have a
promotion programme for its own sales force. Sales promotions may also originate from
retailers and are aimed at customers, though their objectives are different form those of

the manufacturers. Their purpose generally is to increase store traffic rather than sell a
particular brand as may be the case with manufacturer-initiated promotion.
TECHNIQUES OF SALES PROMOTIONS
Consumer market sales Trade sales promotions Sales force sales

promotions promotions
Price discounts Off-Invoice Allowance Sales contests

Price pack deals Buying allowance Incentives
Rebates/refunds Display and advertising Awards and prizes
allowance
Continuity programs Buy back allowance Premiums (gifts)
Coupons Bill back allowance Sales meetings
Samples Count and recount Training
allowance
Contests and sweepstakes Slotting allowance Sales manuals etc.
Premiums and advertising Merchandise allowance
specialties
Free trials POP displays
Brand placement Cash rebate
Event sponsorship Free goods
Product warranties Trade coupons
Exchange offers Dealer listing
Internet promotions Dealer loaders
Low interest financing Sales contests
Free service camps SPIFFS (push money)
Incentives
Sales training programs
Trade shows

CONSUMER SALES PROMOTIONS
Sales promotions directed at the end-user, whether by the manufacturer or the

retailer, are called consumer sales promotions. Manufacturer announced
promotions to consumers are based on ‘pull’ strategy of the manufacturer and
retailer announced promotions to consumers constitute ‘push’ strategy of the
retailer.
Objectives of consumer market sales promotions
The following basic objectives can be pursued with sales promotions in the
consumer market.
♦ Stimulate trial purchase
When a firm wants to attract new users sales promotions tools can reduce the
consumer’s risk of trying something new. A reduced price or offer of a rebate
may stimulate trail purchase.
§ When Dove was launched in the market, people had a certain reservation against the
product. Why?
There were two reasons:
a. Price factor. Most housewives found Dove to be pretty steep and thus consumption
was restrained.
b. Secondly, the rumours of one of its ingredients being animal fat.
HLL began a sales promotion campaign: Get Dove soap free with a kilo of Surf
Excel. With this promotion tactic, HLL got the opportunity of converting non-users
of Dove to users. At the same time changing attitudes of other detergent users by
converting them to Surf users.
§ Whisper, right from the time it launched its first product has been doing a lot of sales
promotions to stimulate trial purchase. The main tool used by it is sampling. They
have done door-to-door sampling, sampling through schools, newspapers, etc. even
now after so many years of its launch it does sampling because of the new target base
that gets added every year.
§ Pantene when it was launched did a lot of sampling, to stimulate trail purchase. Their
efforts have surely shown results, with Pantene being one of the top selling brands in
India today.
♦ Stimulate repeat purchases

In-package coupons good for the next purchase, or the accumulation of points
with repeat purchases, can keep consumers loyal to a particular brand.

The most prominent frequency programs are found in the airline industry where
competitors try to retain their most lucrative costumers by enrolling them for
various perks such as frequent flyers can earn free travel, hotel stays, gifts etc.
§ McDonald s India have targeted a lot at the kids. To keep them coming in again and
again they introduced the happy meal concept where they used to give away different
toys every week. And they advertised about it saying collect your entire set of toys.
This concept really worked and has shown a tremendous increase in the sales and is
presently an integral part of their marketing strategy.
§ Jet Privilege
Jet privilege is a rewarding and customer friendly frequent flyer programme in the
country as a jet privilege member one can earn JP miles not only on jet airways but also
from many other programme partners of the programme.
♦ Stimulate larger purchases
Price reductions or two-for-one sales can motivate consumers to stock up on a

brand, thus allowing firms to reduce inventory or increase cash flow.
Many soaps brands are doing sales promotions to stimulate larger purchases. When
people generally come to buy soaps, and see the offers like,
Fairglow, buy 3 get 1 free,
Lux buy 3 get 1 free,
Rexona buy 3 get 1 free,
Godrej Nikhar buy 3 get 1 free,
Dove get 3 at a reduced price, buy 2 get Lakme fairness cream free,
they generally end up buying more then what they intended to. They often stock up
products at the time of sales promotions.
♦ Introduce a new brand
Because sales promotions can attract attention and motivate trial purchase, it is
commonly used for new brand introductions.
Fairglow has effectively used sales promotions to introduce its brand, by doing a lot of
sales promotions like the buy 3 get 1 free, also Fairglow free with Good Knight, with
other HLL products.
♦ Combat or disrupt competitors strategies

Because sales promotions often motivate consumers to buy in large quantities or

try new brands, they can be used to disrupt competitors marketing strategies. If a
firm knows that one of its competitors is launching a new brand or initiating a
new advertising campaign, a well-timed sales promotions offering deep
discounts or extra quantity can disrupt the competitor strategy. Add to the
original discount an in-package coupon for future purchases, and a marketer can
severely compromise competitor’s efforts.
§ Pepsi
Promotion: Hero No.1
Objective: The promotion wa sales promotions a part of Pepsi s efforts to counter
Coke sales promotions aggressive marketing in thses cities
City: Kanpur and lucknow
Strategy: The event spread over a seven-day activity right after the dance masti
promotions. A mobile float with dancers, performers, and still walkers traveled the
streets of Kanpur and Lucknow. The entertainment was based around the theme of Hero
No.1
§ When Godrej did sales promotions to increase it washing machine sales Samsung to
protect its market also introduced sales promotions.
Godrej gave a rebate offer and a free VIP suitcase. So Samsung also introduced the
rebate offer and gave a camera free.
♦ Contribute to Integrated Marketing Communications
In conjunction with advertising, direct marketing, public relations and other

programs being carried out by a firm, sales promotions can add yet another type
of communication to the mix. Sales promotions suggest an additional value, with
price reductions, premiums, or a chance to win a prize. This is an additional and
different message within the overall communication effort.
Techniques of consumer sales promotions
♦ Price discounts or price-off deals.
Price deals are probably the most commonly used promotional techniques. A
price deal for a customer means a reduction in the price of the promoted product
and the consumer saves money on purchase.
Such a deal is designed to:
§ Stimulate customers to try a new product,

§ To encourage new users to try an existing product

§ To encourage customers to continue product patronage,

§ Increase purchase quantity,
§ Purchase multiple units and
§ Accelerate usage rate.
§ All Out mosquito coils have a bumper offer, 30 hi-power mats originally priced at
Rs.45 are available at Rs.27 only.
Objective: To create brand preference.
It is very important to have sales promotions in the mosquito coils segment. This is
because in mosquito coils there is hardly any product differentiation and so it
becomes necessary to give the consumer a reason to buy. Hence sales promotions
play an important role in increasing your product sales.
§ Colgate fresh energy ice blue gel (Colgate India) 50 gm pack, Rs. 5.50 off on normal
price, now available at Rs. 12.50 only.
§ Lux soaps (HLL) 125gm pack, Rs.5 off.

Objective: To increase sales and to encourage new users.
§ Duracell plus, special offer a pack 2 batteries, Rs.20 off on MRP.
§ Bajaj started the scheme on 20th august 2001, where by if you buy a Bajaj Spirit two-
wheeler you get Rs.3000/- off, valid only in Ahmedabad.
§ Aptech
On the complete ACCP 2002 course, save upto Rs.33,600/-
§ Woodland
On woodland shoes and apparels get upto 50% off.
Price discounts are communicated through POP advertising, window displays,

sales people, advertising in newspapers, magazines and TV ads.
Determining the quantum of discount depends on the consumer’s price

perceptions and may be difficult to decide.
Such promotions work very well in gaining the attention of consumers,

particularly at the point of purchase among similar brands and may also
encourage unplanned or impulse buying. If there are three different models of a
product and because of the discount offered the price of the higher end model is
appears, not too high to the consumer as compared to the lesser priced model,
then the consumer may buy the higher end model.
Titan watches
Objective: make the high end product seen cheaper.

Branded watches are a high value product. Titan watches are expensive compared to
many other branded watches available. Hence in case a sales promotion offer like some
rupees off is available on the watch, the consumer finds the high priced high quality
product cheaper and so buys that instead of the cheaper one.
The main advantage of this tool is that it has a very Strong consumer response
Such discounts offer immediate value and strong consumer response.
The Flexibility and convenience of implementation is another advantage. Price
offers are extremely flexible in the sense that the producer has total control on
the number of units being promoted and the market area in which the offer will
be given. If different packs of the same brand are available, the marketer can
choose the one size that is not selling well.
A discount offer may rapidly lose its advantage if competitors announce a

similar offer. In fact, competitors are very likely to retaliate leading to the danger
of triggering a promotion wall in which no one benefits except the consumer.
Such discounts are short term and are unlikely to produce any long-term gains
because the incentive is to purchase now by creating sense of urgency. When the
discount is withdrawn the sales may fall below the level of pre-promotion
period. And in the long run the sales would return to pre-promotion period
level.
♦ Price pack deals
Price pack deals are also called value packs.

They can take any of the two forms: one is bonus pack and banded pack.
In case of a bonus pack, an additional quantity of the same product is offered free
when the standard pack size of the product is purchased at the regular price.
§ Godrej colour gloss triple action shampoo, offers 20% extra free. 100ml +20ml.
§ Sunsilk shampoo (HLL) 400ml bottle gives 33% more free.
§ New Ever youth lemon face wash, by Cadilla Health care Ltd. Offers 20% Extra with
60 ml 12 ml free.
§ Lotus Herbal Ltd s Fresh Apricot scrub, 25% extra, communicated as 7.5 ounces at
6 ounce Price.
§ Dettol shaving cream (Reckitt Benckiser (India) ltd.) get 40% extra free.
§ Bisleri 20% extra free

A variation of this offer is when the marketer develops special packs of the
product containing more quantity but the price is proportionately low. This is a
method to “load” the consumer up with the product. This technique is often used
to introduce a new large size of the product or to encourage continued usage and
also to increase consumption.
The offer is termed as “banded pack” when 2 or more units of the products are
sold at a reduced price compared to the regular price.
Pepsodent toothpaste special pack a 150gm toothpaste + a 100gm toothpaste and a

G.I.Joe international character, all in 1 pack at a low price of just Rs., which saves
Rs.81/-
Another variation of this technique is “buy 1 get 1 free” or some similar offer, it
could be “same for less” or “more for the same.”
§ Fairglow buy 3 get 1 free,

§ Wipro baby soft baby oil 50 ml pack buy 1 get 1 free,
§ Lux buy 3 get 1 free,
§ Dove get 3 at a reduced price
§ Akai offered a 14" colour television on the purchase of a 21" colour TV.
The main advantage of this tool is that extra product may encourage increased
usage and help sustain the habit. Also among other similar brands, a bonus pack
stands out at the point of sale.
♦ Refunds And Rebates
Refund is the repayment of total money paid for purchase, while the rebate
represents repayment of only part of the money paid for the purchase. Refund
offers seems to work very well in guaranteeing the trial of a product or service
since there is no risk involved for the customer because of the promise of total
refund of the purchase amount.
Refunds and Rebates play an important role in the consumer durable segment
because the product price is reduced to a great extent because of the rebate offer.
§ Whisper
Objective: To increase product trials
After having launched it new product whisper ultra thin, confident about the product
quality and confident about offering the promised product, to increase its trail and
usage has started the money back offer.
The money back offer is a very effective tool in making the consumer try the product
in 2 ways, firstly because the consumer feels that the company will launch such a

scheme only if it is possible for it to offer such quality and so is become confident that
the product will be satisfactory.
And secondly he is more willing to try because if he does not like the product he has
the option to get his money back.
§ Gillette announced a refund offer where a customer was required to buy a pack of
7 o clock P II for Rs. 55.50, on returning the empty pack, the customer gets Rs.
55.50 off on Gillette Sensor Excel.
§ A computer magazine, Chip, offered a refund of Rs. 350 on sending a one-year

subscription, which the customer can use to purchase special issues of the
magazine.
♦ Coupon
A coupon entitles a buyer to a designated reduction in price for a product or

service. Coupons are the oldest and most widely used form of sales promotions.
Coupons bear an expiry date and cannot be redeemed after the cut off date.
Coupons can be of 3 types:
• Direct to the consumer

• Media distributed
• Product distributed.
The main Advantages of coupons are:
• Encourage brand switching

• Stimulate trial for a product
• Take off the attention from price
§ Wipro Shikakai had a coupon in newspapers, which anyone could redeem at the
nearest retail store, where he could buy one and get one free.
§ Fair and lovely dark circle removal cream to create more product trials has coupons
in the newspapers and magazines which avail you of Rs.10/- off on a 40 gm pack.
§ Ponds when it launched its face wash, the market scenario was such that many
brands where coming up with face washes and everyone positioned it as soap-
free, there was not much differentiation and hence ponds intelligently did a sales
promotion where it had coupons in newspapers and magazines which gave the
customer the offer of Rs.5 off on a 50 gm pack. It also gave trail packs free with
its other products.

§ Pears oil clear soap, redeem the coupon at a retail store and buy a 75gm soap get
Rs.5 off
♦ Contests And Sweepstakes
Contests and sweepstakes can draw attention to a brand like no other sales
promotions technique.
A contest has consumers compete for prizes based on skill or ability. Winners in
a contest are determined by a panel of judges or based on which contestant
comes closest to a predetermined criterion for the contest. Contests tend to be
somewhat expensive to administer because each entry must be judged against
winning criteria.
Contests were very often used earlier where people has to write slogans, poems,
stories etc. generally “I like the product because …” and the best ones won
prizes. But off lately, contests are becoming less and sweepstakes increasing.
People are more willing to play on luck rather than participate by showing their
abilities.
§ Nokia India Pvt. ltd.

Promotion: Nokia Sms Challenge-august, 2001
Objective: To establish nokia phones as the most SMS-friendly phones in the market
City: Delhi
Strategy: Tie-ups with 15 premier outlets preceded and asked them to SMS a pre-decided
line to a particular number, the time taken by a participant was the determinant of the
contest, the person taking the shortest tome would be gifted a Nokia 3310 phone.
§ Asian paints
Asian paints had launched a cricket promo. One had to walk into a Colour World outlet
and pick out the shade of blue that the Indian cricket team would be wearing to the
world cup. Should lady luck smile, that individual would be among the 10 to win a free
trip to England.
What was there in it for Asian paints?
People would be exposed to the number of shades available.
§ Taj Mahal
On filling the coupon present in the ad and mailing it with a flip top of Taj Mahal tea
100, 250 or 500g pack, one could win prizes. Prizes included 1st prize: diamond set
worth Rs. 1,00,000, 2nd prize: diamond set worth Rs. 50,000, 3rd prize: Taj Mahal
watches. The offer was available in Punjab, Delhi, Chandigarh, Mumbai and Pune, from
24th august to 25th September.
A sweepstake is a promotion in which winners are determined purely by

chance.

Consumers need only to enter their names in the sweepstakes as a criterion for
winning. Some popular types of sweepstakes also use “scratch-off cards”.
Contests and sweepstakes often create excitement and generate interest for a
brand, but the problems of administering these promotions are substantial.
One problem is that the game itself may become the consumer’s primary focus,
while the brand becomes secondary. The technique thus fails to build long-term
affinity for the brand.
§ Britannia khao world cup jao campaign has taken the market by a swing.
Under the offer you collect points available on Britannia biscuit packets and exchange
100 points for a scratch card, which has various gifts and the 100 world cup tickets. The
offer was actually introduced during the last world cup and had shown phenomenal
results. Sale increased tremendously; there was an increase in the sales by 25%, claims
the company. So it is being done this year too. This year too the contest is showing good
results.
§ Lakme
Obejctive: To increase sales
City: Delhi
Strategy: Scratch a card contest in all Lakme counters of different malls, markets, and
shops was organized. Consumers who bought Rs.150/- worth or more of products were
given a card and ion scratching the colored bar and assortment of gifts can be won.
§ Lipton Tazza.
Promotion: Lipton Tazza Jo chaho woh paao contest-February 2002, July 2002
Objective: to create awareness and build consumer loyalty to Lipton tazza tea
City: all over India
Strategy: With every purchase of Tazza tea, consumers got exciting prizes and also had
the opportunity to win diamond pendants. The bumper prize entailed making a wish list
from TVs, Refrigerators, jewelry, computers any and everything they wished for would be
made available to them.
§ Even TVS Victor and Boost are having scratch cards and giving away world cup
tickets.
§ Maruti Suzuki
With every new Maruti 800 or Omni. The offer was on between 25th august to 15th
September. A 22-carat, 10gm Tanishq gold coin free and lots of other prizes. Other prizes
included 50 Rs 50,000 Tanishq gift vouchers, 10 Rs.1 lakh Tanishq gift vouchers and a
grand bumper prize of 1kg gold.
§ Vim gold bar offer with every Vim bar you get a scratch card, which has many
prizes including gold bars people are showing interest in this offer too.

§ Bombay Dyeing- Bombay Dyeing had the Bombay Dyeing Lao Diamond Pao Offer.
6990 diamonds to be won on buying Bombay Dyeing products worth Rs. 300 and
scratching the card available.
§ Cinthol
Buy Cinthol International Perfumed Deodorant and through the scratch card:
1 Ist prize- Win a trip for 2 to Australia
5 IInd prizes - Panasonic 29" colour television set.
150 IIIrd Prizes - Braun hand blender.
Guaranteed minimum prize Rs 5/- OFF.
Contests-cum-sweepstakes:
Elle 18
Promotion: Elle 18 valentine s day promotion, feb 2002
Objective: to use valentines s day platform to communicate with th etarget audience of
Elle 18
City: Delhi, Mumbai, Banglore, Chnadigarh, Pune.
Strategy: Upon the purchase of Elle 18 products worth a certain amount, a scratch-card
was given out. this could entitle the person to a number of gifts and hampers. The
highlight of this was the Cinderella Activity which invited those customers who had
bought products worth a pre-decided amount to try put a glass slipper. The lucky few,
whose feet fit, were awarded dinner dates.
♦ Sampling
Getting consumers to simply try a brand can have a powerful effect on future
decision-making. Sampling is a sales promotion technique designed to provide a
consumer with an opportunity to use a brand on a trial basis with little or no
risk. Saying that sampling is a popular technique is an understatement. Sampling
is particularly useful for new products, but should not be reserved for new
products alone. It can be used successfully for established brands with weak
market share in specific geographic areas.
Techniques used in sampling:
• In-store sampling
Lakme has in-store trail products. Since it in the cosmetics market it is very essential to
provide samples, many stores in Mumbai from time to time have Lakme sampling offers.
Where they allow you to try the product and then buy it.
• Door-to-Door sampling

Whisper have done door-to-door sampling, sampling through schools, newspapers, etc.
even now after so many years of its launch it does sampling because of the new target
base that gets added every year.
Pantene also does door to door sampling.
• Newspaper sampling
Again Whisper and Pantene have done sampling through the newspapers.
• On-package sampling
Fair glow, a lot of free Fairglow soaps were available with many other products,
especially other HLL products.
• Mobile sampling
Many road shows and mobile vans distribute free products or offers.
Free Movie tickets, disco passes, pens…are often distributed.
Lehar Kurkure
Promotion: Smapling excersie
Objective: to create awarness and initiate the consumer; sales promotions taste buds.
City: 18 cities
Strategy: Extensive sampling for kurkure was undertaken in 18 cities in the north
wherein a branded float visited various markets and sample packs of the product were
distributed to the target audience. Over 2 lakh packs of kurkure were distributed as
samples.
♦ Trial offers
Trial offers have the same goal as sampling – to induce consumer trial use of a
brand- but they are used for more expensive items.
Ex: exercise equipment, appliances, consumer electronics, etc. the expense to the
firm of course can be formidable. Segments chosen for this sales promotion
technique must have high sales potential.
♦ Premiums and advertising specialties
Premiums
They are items offered free or at a reduced price, with, the purchase of another
item. Many firms offer a related product free.

There are 2 options available for the use of premiums:
1. A free premium provides consumers with an item at no cost, the item is

included in the package of the purchase item.
2. A self-liquidating premium requires a consumer to pay most of the cost of
the item received as a premium. In this promotion offer the consumer is
required to send a specified sum of money along with a proof of purchase
to claim the premium.
Premiums have become very common today. Many companies are offering lots
and lots of premiums. The main advantage of Premiums is that they offer not
only that one product but also another product, which may influence the
customer, a lot to buy the product. Especially if the other product is worth it.
Also new products are given free with established brands to stimulate trial of the
new brand.
§ When attacked by Cavincare of Fairever fame, HLL adopted a defensive strategy by

giving away one more Fair and Lovely free with every purchase of it (BOGOF). This
is one of the many ways by which a marketer can piggyback on the brand s standing
in the market.
§ Ponds buy Ponds cold cream 100ml and get a ponds body lotion 50ml pack free.
Buy Good Knight expert refill pack and get 3 Nyle shampoo sachets free.
§ Pepsodent toothpaste buy 100gm and get 4 Clinic Plus sachets free.
§ With 2 Dove soaps get a Lakme Fair Perfect cream free.
§ Colgate toothpaste 200gm gives 500 ml Pepsi free
§ With every car financed, Tata Finance gave Tata finance credit card free, applicable
only in Calcutta.
§ On using HSBC credit card you get around 25%off at select restaurants.
§ Buy Nivea cream (J. L. Morison (India) ltd.) 50ml and get Nivea soap worth Rs.22
free.
§ Buy Nivea body pure talc and get Colgate fresh energy gel toothpaste free.
§ Buy Nestle Cerelac 400gm get Johnson s baby soap free.
§ Buy Nescafe classic 50gm and get Nestle Kitkat free (36gm)
§ Buy Servo engine oil and get Coca-Cola or Mazza free.

§ VLCC With every spot reduction package for tummy/ thighs/ hips, free 5 kgs.
weight loss.
§ Excalibur, on buying any two Excalibur shirts or trousers, a wristwatch worth

Rs.350 free.
Advertising specialties
Popular advertising specialties are caps, t-shirts, toys, mugs, mouse pads, pens,
calendars, etc.
Advertising specialties have 3 key elements:
A message placed on a useful icon, and given to consumers with no obligation.
§ Pepsodent toothpaste 100gm pack get free dental insurance worth Rs.1000, this is a
very effective strategy because it is giving you re the guarantee that nothing can
happen to your teeth. The Rs.1000 insurance speaks a lot for its brand and its product
thrust.
§ Buy a Fairglow fairness cream and get a mirror free.
§ Buy a Kodak camera and get a Dil Chahta Hai T-shirt free.
§ CMC Computer Education

On enrolling for DST & eDAST, a set of 3 CDs of Brittanica Encyclopedia worth Rs.1995
free.
§ Every pack of Rasna gives free prankies. This influences the kid to a great extent.
Because of the prankies the kid wants to buy only Rasna and nothing else. So the
mom does not have a choice but to buy a Rasna
Many other kids products are influence a lot by such specialties especially liked
by the kids like tattoos, masks, tazo, cricket bats etc. hence products that have
such offers sell more than the other brand available.
§ Ruffles lays, get free Tazo,

§ Rasna, get free Prankies
§ 5 Alpenlibe get free tattoos
§ 1 Marbles get free tattoos.
§ Cadbury s Gems get Spiderman masks free.
§ Cadbury s Dairy milk buy 2, 13gms chocolate get a toy free.
§ Archies mousepads.
§ Pepsi caps
§ Duracell T-shirts

♦ Continuity/frequency Programmes
In recent years, one of the most popular sales promotion techniques among
consumers has been “frequency Programmes”. The main objective of such
Programmes is encouraging repeat purchases or repeated visits to particular
retail shops. Frequency Programmes offer consumers discounts or free product
rewards for repeat purchase or patronage of the same brand or company.
§ Shoppers stop
Objective: reward the loyal customer.
Shoppers stop started the First Citizens Club and enrolled customers as
members of the shoppers club by charging a fee of Rs.150. The customers were
entitled to a variety of benefits by collecting points.
§ Indian Airlines frequent flyers programme where you get discounts on frequent
visits, get hotel stays free, credit facility etc.
§ McDonald s announced a promotion to stimulate repeat visits to its restaurants. A

part of the communication said now every time you buy a happy meal for your
kids, they get a lego system set with it - every 10 days there will be a different lego
system set inside each box.
♦ Brand placement
Brand placement often referred to, as product placement is the sales promotions
technique of getting a marketer’s brand featured in movies and television shows.
The use of a brand by actors and actresses or the mere association of the brand
with a popular film/ television show can create a positive image and have a
huge impact on the sales of a brand.
Marketers and advertisers used to think that brand placements affected only
consumers’ perceptions of a brand, much like advertising. But recent brand
placements have shown that the technique can have a sales impact like a
traditional sales promotions.
Brand placement has varying results; if the brand name is spoken aloud the
impact can be dramatic but less obvious placements, referred to as background
placements are considered by some as a waste of money.
§ Coke in Yaadein , Pepsi in Khushi

§ Pass Pass in Yaadein
§ Tourist destinations in many films.
§ Provogue shirts in all Fardeen Khan movies.

♦ Event sponsorship
When a firm sponsors or co-sponsors an event such as a rock concert, a cricket
match, etc. the brand featured in an event immediately gains credibility with the
event audience. The audience attending an event already has a positive attitude
and affinity for the contest – they choose to attend. When this audience
encounters a brand in this very favourable reception environment, the brand
benefits from the already favourable audience attitude.
§ Hindustan lever limited:

Project: Lakme Makeover promotion January 2002
Objective: to present the amazing qualities of Lakme range of cosmetics
City: Delhi
Strategy: tie-ups with select outlets preceded the actual event. They served as the venues
for makeovers that were conducted live on the spot. During the course of the promotion,
a fashion show, featuring the 3 models that represent the range of the promotion, a
fashion show featuring the 3 models that present the range, was also organized. This
event led to a considerable increase in the actual sales of the products.
§ Coke and Pepsi keep sponsoring cricket matches.
§ Coke [V]Popstars this was one of the event sponsorships that had a lot of effect on
the sale of Coke. The V Popstars was a very interactive session being shown live on
channel Vand all those who watched it and liked it, automatically also developed a
favourable impression of Coke because of their association with the event.
§ Britannia s association with the cricket world cup through the Britannia khao world
cup jao offer, has had a lot of impact on their sale and their brand image.
§ Ponds association with women s day creates a special liking for ponds among
women.
§ Britannia Tiger sales promotion s association with the Lagaan Super match also
enabled Britannia to develop a positive image for the brand Tiger Biscuits in the
mind of the customers and consumers.
♦ Exchange offers
If a family bought a refrigerator 10 years ago and the machine is still giving
reasonable service then the family is unlikely to buy a newer and more advanced
version of the refrigerator unless they get rid of the older one by selling it to
someone. No one in our country is prepared to throw it as junk. Same thing is
true for a number of products such as televisions, microwave ovens, washing
machines, cars, two-wheelers, computers, etc.
This segment of present owners is sizeable enough yet to sell new brands to
those who already own a similar product is not easy. To attract this segment,
manufacturers regularly announce exchange offers.

Consumer durables market is the one where exchange offers are used the most.
Almost all the TVs, Refrigerators, Washing Machines, etc. have exchange offers.
§ Samsung
On exchanging old TV for a new Samsung Plano, upto Rs. 5000 off.
On exchanging old TV for a new Samsung Hitron Digital, upto Rs. 3000 off.
On exchanging old refrigerator for a new Samsung refrigerator, upto Rs. 8000 off.
§ Kurl-on
On exchanging old mattress for a new Kurl-on mattress, get Discount upto Rs. 1200.
♦ Internet promotions
They are the most recent form of sales promotions. They are promotions that are
done via the Internet. It is becoming increasingly popular because of the large
use of Internet. But still it has a lot to develop.
The Godrej group of companies has launched "Godrej Bargainz", which the company
claims is the first ever online sales promotion by an FMCG company in India.
The promotion - where consumers can actually save while shopping from the Godrej
Store on www.iBaya.com - will run exclusively on iBaya.com. Under the promotion, five
winners will be chosen every week from the consumers who have shopped on the Godrej
Store on the Website. The winners will receive a year's free supply of Godrej consumer
products.
According to the company, the store features the entire range of Godrej consumer
products such as soaps, detergents, toiletries, hair colours, shampoo, hair oil, fruit
beverages, processed foods, wheat atta, packaged foods, bakery items and household
insecticides. Further, all the products have been made available at a special discount on
the MRP to the consumer.

TRADE PROMOTIONS
Sales promotions can also be directed at members of the trade – wholesalers,

distributors, and retailers. It is intended to stimulate demand in the short run
and help push the product through the distribution channel more immediately.
Effective trade promotions can generate enthusiasm for a product and contribute
to the loyalty distributors show for the brand. With the massive proliferation of
new brands and brand extensions, manufacturers need to stimulate enthusiasm
and loyalty among members of the trade and also need a way to get the attention
of the buyers suffering from information overload.
Objectives for promotions in the trade market
Generally speaking, when marketers devise incentives for the trade market, they
are executing a push strategy – i.e. sales promotions directed at the trade help
push a product into the distribution channel until it ultimately reaches the
consumer.
♦ Obtain initial distribution
Because of the proliferation of brands in the consumer market, there is fierce

competition for shelf space. Sales promotion incentives can help a firm gain
initial distribution and shelf placement. Like consumers, members of the trade
need a “ reason to choose” one brand over the other when it comes to allocating
shelf space. A well conceived promotion incentive might sway them.
♦ Increase order size
One of the struggles in the channel of distribution is over the location of

inventory. Manufacturers prefer that members of the trade maintain large
inventories so that the manufacturer can reduce inventory-carrying cost.
Conversely, members of the trade would rather make frequent, small orders and
carry little inventory. Sales promotions techniques can encourage wholesalers
and retailers to order in large quantities, thus shifting the inventory burden to
the channel.
♦ Encourage co-operation with consumer market sales promotions
It does a manufacturer no good to initiate a sales promotion in the consumer

market if there is little co-operation in the channel. Wholesalers may need to

maintain larger inventories and retailers may need to provide special displays or
handling during consumer market sales promotions. To achieve synergy,
marketers often run trade promotions simultaneously with consumer
promotions.
♦ Increased store traffic
Retailers can increase store traffic through sales promotions or events. A

promotion that generates a lot of interest within a target audience can drive
consumers to retail outlets.
Techniques of trade sales promotions
♦ Allowances
§ Off-invoice
Here marketers allow wholesalers and retailers to deduct a set amount from the
invoice they receive for merchandise. This programme is really just a price
reduction offered to the trade on a particular marketers’ brand for a specified
short promotional period. The incentive for the trade with this programme is that
the price reduction increases the margin (and profits) a wholesaler or retailer
realizes on the off-invoiced brand.
This scheme is in general available for many products, where if the bill amount is above
a certain amount you get a certain percentage discount. The % varies from around 2% to
10%, from company to company and also from time to time.
§ Buying allowance
It is similar to the off-invoice allowance. It is a discount for the purchase of the
promoted product during the specified period on the purchase of certain
minimum quantity of the product. This trade incentive is often used to gain
more distribution or to maintain the existing one.
§ Display and advertising allowance

The retailer is required to arrange the product display in a prominent show-
window or offer discount to consumers and advertise this offer in the local
newspaper or arrange a point-of-purchase display on the shelf corner. The
retailer earns the incentive only after meeting the conditions set by the
manufacturer.
§ Buy back allowance

Manufacturers sometimes announce a buy-back allowance to encourage re-

stocking by retailers. This promotion immediately follows another type of deal
offered to resellers and offered some incentive for new purchases. When the
manufacturer realizes that after the initial deal the inventory levels at the retail
level are quite low or depleted, such an offer helps in building the inventory
level with retailers to normal.
§ Bill back allowance

The manufacturer offers a discount for every item purchased during the
promotion period. At the end after the promotion is over, the dealer counts the
discount per unit for all the items bought during the promotion period, adds any
additional promotional allowances as stipulated by the manufacturer and
submits the statement. He also needs to submit the bill for all such items.
§ Count and recount allowance

This allowance consists of an offer of certain amount of money to retailers for
each unit of promoted product sold out of their stocks during a specified period
of time. The sales person concerned counts the opening stock with each retailer
at the start of promotion and a final recount is made at the end of the promotion
period. It can be used to ensure that resellers are not out of stock. The deal is easy
to implement and the allowance is paid only on product units sold from the
retailer’s shelves.
§ Slotting allowance
These are the fees that a retailer charges the manufacturers to make available the
space on the shelf for their new products. Retail store owners say that the
number of brands in each category is multiplying, there is increasing competition
and margins are decreasing, hence they have no option but to ask for a fee to
keep the product on their shelf and use the money to improve their shelf design
and promotion, etc.
♦ Merchandise allowance
In the form of free products packed with regular shipments, are payments to the
trade for setting up and maintaining displays. The payments are typically far less
than manufacturers would have to spend to maintain the displays themselves.
Some of the schemes operating in town are:
§ Buy Cadbury s products worth Rs.3000/- and get 30 any chocolates worth Rs.5 free.
§ Buy 30 Bonbon packs and get 1 free.

§ Buy Colgate toothpaste worth Rs.500/- and get 6% discount.
§ Buy 24 Close Up toothpaste and get 1 free.
§ Buy 3 Good Knight Liquid packs and get 1 free.
§ Buy 3 Mortein coils and get 1 free.
♦ POP displays
Point-of-purchase displays i.e. product displays and information sheets are
useful in reaching the consumer at the point of purchase and often encourage
retailers to support ones brand. POP promotions can help win precious shelf
space and exposure in a retail setting. From a retailer’s perspective, a POP
display should be designed to draw attention to a brand, increase turnover, and
possibly distribute coupons and sweepstake entry forms.
Companies do P-O-P displays as and when they have sales promotion schemes
going on.
Some companies that do a lot of P-O-P displays on a regular basis are Gillette, Vicks,
Duracell, Pepsi, Coke
♦ Cash rebate
This is a form of delayed value promotion for the retailer. Only after the proof of
performance is furnished, the retailer is given a cheque for the amount of
discount.
Once a retailer has met the laid down conditions, the rebate is given to the
retailer. The advantage of this method is that the rebate is given only after the
retailer has performed to qualify for the rebate.
♦ Free goods
A free goods promotion is a deviation from straight price cut. The promotion
offer to trade is in the form of extra quantity of purchased product “free”. For
example, the manufacturer offers one case of free goods with the purchase of 12
cases of the product. There may or may not be any limit on the quantity of the
purchase during the promotion period. If the retailer purchases 36 cases of the
product, then he gets 3 cases of the same product free.
Free goods deal often encourages resellers to stock more during the promotion
period. For the manufacturer, it is an excellent promotion because it costs less
than it otherwise appears.
§ Buy 24 Close Up toothpaste and get 1 free.
§ Buy Cadbury s products worth Rs.3000/- and get 30 any chocolates worth Rs.5 free.

§ Buy 3 Good Knight Liquid packs and get 1 free.
§ Buy 3 Mortein coils and get 1 free.
♦ Dating
Manufacturers of seasonal products often use dating as a technique of sales
promotions. Dating is not a direct type of allowance such as free goods or cash.
Manufacturer extends the facility to retailers to purchase a certain quantity of
product now but the billing is done after a period of time. It is not only the
billing, the retailer purchases the product at some reduced price during the
promotion period, however, the goods are shipped at a later date.
♦ Trade coupons
It is a manufacturer initiated sales promotion, however, the coupon distribution
is undertaken by retailers, either through local print medium or in some other
manner. The important thing about such coupons is that they can be redeemed
only at the distributing store. There is an agreement between the retailer and the
manufacturer that some agreed allowance will; be paid to the retailer. Generally
this is in the form of re-imbursement of some amount of money to the retailer for
each coupon redeemed. The distributing retailer gets the double benefit due to
the increase in store traffic and the incentive of reimbursement from the
manufacturer. This is a string incentive to the retailer to arrange displays and
promote the coupon offer.
♦ Dealer loaders
A dealer loader is a premium that the manufacturer gives to the retailers for
buying a certain quantity of a product. There are generally 2 types of dealer
loaders – buying loader and display loader.
A buying loader is given to the retailer on purchase of a specified quantity of a
particular product.
A display loader is the premium given to the retailer for the window display.
After the promotion period is over, the item or items, are given to the retailer as a
free premium.
♦ SPIFFS (also called ‘push money’)

It is a monetary reward given to the salesforce of the dealers to sell a
manufacturers product. For example, a manufacturer of washing machines may
offer Rs.500 to each sales person who sells the manufacturers’ brand of washing
machine. The SPIFF money varies as does the willingness of the dealers to allow

the salesforce to accept the offer. Dealers who carry product brands of different
manufacturers generally hesitate to allow such offers.
♦ Incentives
Incentives to the members of the trade include a variety of tactics like awards in
the form of travel, gifts, or cash bonuses for reaching targeted sales levels that
induce retailers and wholesalers to give a firms’ brand added attention. The
incentive does not have to be large or expensive to be effective.
Another form of trade incentive is referred to as ‘push money’ i.e. SPIFFS.
♦ Sales-training Programmes
An increasingly popular trade promotion is to provide training for retail store
personnel. This method is used specially for consumer durables like personal
computers, exercise equipment, etc. the increased complexity of these products
has made it important for manufacturers to ensure that the proper factual
information and persuasive themes are reaching consumers at the point of
purchase. For personnel at large retail stores, manufacturers can hold special
classes that feature product information, demonstrations, and training about
sales techniques. Another method to give information would be the use of
videotapes and brochures.
Hewlett Packard
Promotion: Mystery shopper program
Objective: to revitalize the distribution chain, audit retailers and the competitive
situation.
City: Delhi, Mumbai, Ahmedabad and many more
Strategy: aimed at the dealers, the objective of this promotion was top revitalize the
distribution chain, audit retailer and competitive situation. Mystery shoppers visited the
retail outlets to ascertain merchandising and retailer-consumer interaction.
♦ Trade shows
At trade shows, related products from many manufacturers are displayed and
demonstrated to members of the trade. Literally, every industry has trade shows.
Their representatives are there to explain the products and services and perhaps
make an important contact for the sales force. The use of trade shows must be
carefully coordinated and can be an important part of the business market
promotional programme. Trade shows can be critically important to a small firm
that cannot afford advertising and has a sales force too small to reach all its
potential customers.

SALES FORCE PROMOTION
Sales promotion directed towards the sales people is referred to as sales force
promotions. These schemes are intended to motivate sales people to put in more
efforts to increase sales, increase distribution, promote new or seasonal products,
sell more deals to resellers, book more orders, develop prospects lists and build
up morale and enthusiasm. Some of these activities are meant to prepare the
sales people to do their jobs well and include sales meetings and manuals,
training programmes, sales presentations, film and slide shows etc. Prize
distribution to winners is the more tangible aspect of any such programme.
Objectives of sales force promotion schemes are:
♦ Increase sales volume

♦ Introduce a new product
♦ Reducing selling costs
♦ Offset competitive promotions
♦ Improve working habits
♦ Develop new prospect lists etc.
Tools used in sales force promotions
♦ Sales meetings
Sales meetings are generally organized for sales people form one area, region or
district more frequently, usually once a month, once in two months, or quarterly.
These meetings bring together sales people from different territories of the nation
and are considered a popular way of educating sales people. There is a varying
mixture of business and pleasure.
Educational material of sales meetings generally focuses on product knowledge ,
selling skills and motivation of the sales force. The programme often includes
formal lectures, quiz shows, etc. The purpose is to generate interest and
enthusiasm and the winners are awarded prizes and certificates.
§ Max Healthcare
Objective: to celebrate the annual day of Max-India and instill a sense of pride amongst
the employees for being exclusive Max-team members.
City: Delhi
Strategy: presentations, reviews and their vision for the future marked the evening. An
address by the chairman, Mr.Analjit Singh and the award ceremony were the highlights.
The vent itself was held in park royal, Delhi. Live feed of the evening was transmitted on
audio-visual screens. This exclusive live relay added to excitement among the invitees.

§ Electrolux
Promotion: Salespersons Meet- operation juggernaut
City: Goa
Objective: To encourage the sales personnel to sell more
Strategy: salespersons were treated to a futuristic experience with the theme of start
wars. Laser shows, glass-shattering effects, etc. were a part of the theme.
♦ Sales Manuals
Training materials such as manuals, visual aids, flip charts, programmes,
learning books are most useful to sales people. Sales manual may be long or
short depending upon the type of the products manufactured and sold by the
company. The sales manuals usually contain product details, applications,
manufacturing processes, prices, sales techniques etc. Some companies also have
house journals that reports about the company programmes, new products,
research activities, new polices, awards, promotions, etc.
In any firm where personal selling is critical for the sale of the product incentives
to the sales people become very important. Incentive programmes most often
used by the company include paid vacations within or outside the company,
cash rewards, prizes, honour awards, merit certificates for excellent performance
etc.
♦ Training
♦ Sales contests
♦ Incentives
♦ Awards and prizes
♦ Premiums (gifts)
Consumer-cum-Dealer-cum-Sales force sales promotions:
Nokia
Promotoion: perfect 10 contest
Objective: to attract channel partners, salespersons., an prospective buyers
City: 15 cities
Strategy: the contest was three fold - for consumers, dealers, and sales personnel. A
large number of activities were organized. Dealer road shows, mass media consumer
competition and intensive merchandising were undertaken. Lucky draws were conducted
and the participants get to win some great prizes also.

THE CONSUMER DECISION MAKING
The consumer decision process begins with the recognition of need; that is, the
consumer must recognize the need to purchase a product. Only then does he go
through the process to choose the product. A display or any other promotion
may remind the consumer that he/she needs the product, or may awaken the
latent demand for the brand or product category. Because of the sales
promotional communications, need or problem recognition may get triggered in
both high involvement as well as low involvement consumers. If the purchase
situation happens to be one of high involvement, triggered by an attractive
exchange offer, or interest-free installments for consumer durable products such
as refrigerators, oven, washing machine, colour television set, etc., it is more
likely to result in extensive problem solving effort rather than immediate
purchase. The sales effect in case of low involvement situation is likely to be
immediate because of unplanned or impulse buying or because of familiarity or
top-op-mind recall of the brand. The consumer may think it is not worth
devoting time and effort to the purchase situation in question. The low-
involvement consumer may have visited the retail store with the intention of
purchasing a certain product but an in-store display attracted his/her attention
and led to brand switching or impulse buying. According to some researchers,
this type of behaviour is an attempt towards reducing the amount of mental
exercise by using simple decision rule in making a purchase decision. Some
experts believe that price-cut and in-store displays are more effective for low-
involvement than high-involvement consumers.
In a severely competitive market where brands are considered as having no real

differences, consumers learn that many brands will meet the requirements.
Naturally, the purchase behaviour is likely to become one of low-involvement
and the brand on promotion has more chances of being purchased.
One can distinguish four different types of behaviours depending on the degree
of perceived difference among brands and the level of consumer’s involvement
in a purchase situation.
High Low
Involvement Involvement
Complex Variety-
Significant Differences
Buying Seeking
between Brands
Behaviour Buying
Behaviour
Few Differences Dissonance Habitual

between Brands reducing Buying
Buying Behaviour
Behaviour
‘Complex Buying Behaviour’ is shown by consumers when they perceive

significant brand differences and they are highly involved in the purchase
situation. Such a situation may result because the product is expensive, ego
intensive, risky in some way, or infrequently purchased. The consumer does not
possess any meaningful information about the product and is in need of
information. He/she makes a well-considered purchase.
‘Dissonance-Reducing Buying Behaviour’ results when the consumer’s

involvement in the purchase situation is high because the product is expensive,
risky, self-expressive or infrequently purchased. The differences among brands
are perceived as not significant. After the purchase, consumer experiences
dissonance. As all the brands would not have all the features, the consumer
suspects the correctness of her/his decision. This causes uneasiness and the
consumer looks for reassuring information and avoids disconcerting
information.
‘Habitual Buying Behaviour’ results when the consumer’s involvement is low

and there are no significant differences among brands. This is generally the case
with most low priced and frequently purchased products. In this category, sales
promotions can lead to considerable brand switching. Consumers buy these
products as routine purchases and do not consider them to be important. They
reach for certain brands because of familiarity and not because of any brand
loyalty.
‘Variety-Seeking Buying Behaviour’ results in product categories where there

are significant differences among brands but the consumer has low involvement
in these products.
There is much brand switching due to variety seeking or boredom. Sales

promotions can encourage increased brand switching because of premium offer
or due to some contest.
When the information requirements are high and there is an absence of any
established criteria for evaluating the product category or specific brands in the
category, the decision-making would be one of extensive problem solving (EPS).
Typically, the purchase situation would be one of high-involvement.
If the consumers have already established some criteria to evaluate the product
category or the brand, they are likely to engage in limited problem solving (LPS)
and would collect some additional information to reach a decision. They may not
have any preference for a particular brand and hence would like to know a little

about the differences among brands. This would be more like “fine tuning” their
decision.
When consumers have some experience with the product category and have
established criteria to evaluate different brands, they may buy the product as a
matter of routine. This is routinised response behaviour (RRB). In some cases the
consumers may search for a small amount of additional information but, in
general, they only review what they already know. Sales promotions can lead to
significant increases in the sales figures of the products if the consumers’ buying
behaviour is routine type (habitually buying behaviour).
HOW ARE SALES AFFECTED BY SALES PROMOTION?
A question asked by numerous today .But at the

end of the day do promotions increase sales?
Earlier this month, Smithkline Beecham Consumer Healthcare launched a promotion for
Horlicks and is offering a game with the drink.
Result?
Within 15 days Horlicks sales have gone up. Nestle s Milo, too, has been doing fairly
well purely on the basis of the cricket bat it offers with the product, says a retailer at a
supermarket in Mumbai.
How does sales promotions influence sales ?

There are 4 basic mechanisms involved:
1) Brand switching
2) Repeat buying
3) Purchasing more or accelerating timing
4) Increasing category expansion and consumption
1) Brand switching
The objective of some sales promotions is to induce brand switching, i.e.
encouraging the consumers to purchase the promoted brand instead of the
regular brand that would have been purchased had there been no sales
promotion. This type of brand switching is often called ‘aggressive switching’.
The second type of promotion effect on brand switching is considered as
‘defensive switching’. In this case, the objective is to retain the customer by
encouraging him to buy the same brand as was bought on earlier occasions.

Godrej offered free gifts plus discounts on its washing machines to make consumers
shift from newly arrived competition (Samsung). That was an aggressive strategy.
To prevent its customers from shifting to Godrej, Samsung had to launch a similar
scheme of free gifts and price discounts. This was a defensive strategy.
The manufacturer’s concern is to compete with other similar brands, while

the concern of the reseller is to encourage customers to buy from his store.
When a retailer promotes, consumers respond by switching stores, i.e. they
purchase from the store that is promoting instead of the regular store.
Promotions offering price deals influence the attitude of consumers towards

buying the brand. Much would depend on the size of the discount and the
consumers’ sensitivity towards price and how much importance consumers
place on price as compared to quality. If the attitude toward the brand has
been quite low compared to some other brands, then a price promotion is
likely to encourage a switch to the promoted brand. Such price promotions
may also encourage consumers to buy an otherwise expensive brand which
they could not afford on the normal list price.
Displays at the points of purchase may induce brand switching because they
serve as conditioned stimuli associated with price promotions. Over a period
of time, consumers get trained to associate displays with price reductions
and respond even when the price reduction is not there.
If most of the consumers are inclined towards low prices because of

economic conditions, the majority of them are assumed to be buying low
priced brands. However, if the price of an expensive item is reduced because
of a promotion, some consumers from low quality category will switch to the
promoted brand. But when the low quality product is promoted, there is no
switching because the consumers have been buying the brand without
promotion. The consumers from high-income group are unlikely to switch to
low-price brand because of promotion and the sales gains would not be
there.
2) Repeat buying
When a consumer buys a product on promotion, this may lead to
developing a habit towards purchasing that brand and some evaluation
about the performance of that brand. It may also happen that since the brand
is purchased on promotion, the consumers’ attitude towards the brand
weakens, and the probability of purchase in future declines. Repeat purchase
may result because of habit formation that may develop because the brand is
bought more than once due to sales promotion. Much depends on the
satisfaction of the consumer with the brand purchased on promotion.

For example, if a customer purchased a Godrej refrigerator on promotion and was

satisfied, it is very likely that next time when the need arises, the customer would
purchase the same brand again on promotion, or other products of the same
manufacturer when available on promotion.
Repeat purchasing is often the result of habit formation and learning. Sales
promotions stimulate the customers to by a product and this becomes the
first step towards establishing a habit. Another route is not to allow the
brand user to shift to some other brand by rewarding and reinforcing the
already established behaviour.
In case of low-involvement products, the role of habit is more important. The

consumer does not want to devote much time to thinking and pre-purchase
evolution in making a purchase decision. Habit helps the customer avoid
any cognitive effort and helps as a simple and convenient way to decide
which brand to purchase.
Once a consumer gets used to the long-lasting effect of Duracell batteries, it
becomes a habit and he would not think much before going in for the same brand
again.
In case of high-involvement products, it is assumed that learning takes place

when the consumer experiences the actual performance of the product and
makes an evaluation. A favourable evaluation is likely to help sustain the
habit. In some cases, even consumers with low involvement often make
evaluations that may have repercussions with regard to developing the
habit.
This holds true to a great extent in case of industrial products, where the actual
experience after initial usage is very important.
3) Purchasing more or accelerating timing

Purchasing more and accelerating timing refers to those situations when
consumers buy more than their immediate requirement, or shift their
purchase timing as a result of promotions. When resellers buy more than
their normal requirements, it is called ‘forward buying.’ Building excessive
inventories in this manner often leads to stock diversion in non-deal areas.
Another important repercussion of this purchase behaviour is that it merely
shifts the purchases which would have occurred anyway.
For example, if a consumer buys more than the immediate requirements, then in the
next purchase period, this consumer either would not buy, or buy less. In another
situation, due to promotion, the consumer buys the refrigerator now, though the
intention was to buy after 2 months.
This is purchase acceleration.

Another effect of promotion can be that consumers who have bought in

excess of their requirements would be out of the market. Similar would be
the retailers’ shelves are full. This can help in pre-empting the competition.
Such acceleration in purchase quantity would also help in preventing brand
switching, and in some cases, more consumption of the product.
The reverse may also be true in certain situations, i.e., negative acceleration
when the consumers buy less or decide to purchase later rather than now.
This may happen when the sales promotion stimulates brand switching. The
consumer wants to try the product and buys a smaller quantity to reduce the
risk associated with using something new. The consumer may also postpone
the purchase of a product because he/she learns from some source about the
forthcoming sales promotion or anticipates it.
4) Increasing category expansion and consumption

Sales promotions are likely to stimulate demand by creating new occasions
for purchase or by increasing the consumption rate of consumers. In certain
situation, the purchase of a product category gets accelerated. Sales
promotions such as displays can create new purchase occasions by the
reminding the customer that the displayed product is good for growing
children (protein biscuits). Other products, for example noodles or potato
chips purchased on promotion in multiple units, can increase the
consumption rate, which is often the objective of many promotions.
One example can be of condensed milk, (Milkmaid). An attractive display of this
brand is arranged and a free recipe book is given on purchase of 2 packs. This is
quite likely to increase the rate of consumption of this product and consumers will be
tempted to try different recipes.
In case of many high-involvement products, promotions can help consumers

to realise that a certain product would serve as a good gift item (a silk sari,
camera, a Cadbury pack, Ray-Ban sunglasses, etc). In some cases, there is a
certain price limit beyond which the consumers will not buy a product.
However, a price promotion offer lowers the price of the product below the
customer’s price limit, and thus a purchase occasion is created. Many
customers buy cars when available on promotion such as interest-free
installments, which otherwise they are not in a position to buy on down
payment. Of late, this is happening in case of almost all brands of computers.
Observations in the market place point to the likelihood that brand

switching, repeat purchasing, purchase acceleration and consumption, all
occur simultaneously. The net result, however, is that sales promotions
work.

SALES PROMOTION BUDGET
The allocation of monetary resources to sales promotion is determined by the

promotional strategy of the firm.
In most cases, first the total amount of money for promotion is determined then
it is budgeted for different activities. Before deciding the money allocated to
sales promotion, the management should evaluate relevant factors such as type
of product, its stage in PLC, the market situation, level of competitive activity,
etc. All these factors, alone or in combination, can significantly affect the
promotional budget. There are five important techniques that are commonly
used to allocate funds to sales promotion.
♦ Percentage of sales method
The percentage of sales method to allocate the funds is probably most popular
among companies. In this approach, the budget is determined by taking a fixed
percentage of sales. The sales figure taken could pertain to the previous year, or
the average of several past years. This percentage could also be based on the
forecasted sales of the year under consideration.
♦ Unit of sales method
This method is commonly used by companies dealing in high-priced products,

generally consumer durable goods such as four and two wheeler auto-
manufacturers, refrigerators, washing machines, microwave ovens,
entertainment electronics and many other items.
Instead of rupee value of sales, as in the previous method, the base is the
physical volume of either the past or anticipated sales. This figure of units is
then multiplied by a fixed amount of money to reach the budget amount. For
example, the manufacturer might allocate Rs. 2000/- per unit for sales
promotion.
♦ Competitive parity method
Many marketers match or base their sales promotion budget to that of the major
competitors. The logic attributed to this method is that the collective minds of
the companies in the industry probably generate promotion budget that are close
to optimal and any departure from the industry norms may lead to promotion
war.
♦ All you can afford method

In using this approach to budget allocation, the amount that is leftover after all
other relevant allocations have been made, is earmarked for sales promotion.

This approach is used, generally, by companies with small budget, or by some

other companies, large as well as small, when they are introducing a new
product. It is merely an availability oriented budget and quite unsophisticated.
Apparently, there is no realisation that in a competitive market situation, sales
promotion mainframe sales in many ways.
♦ Objective end task method
As mentioned earlier, the promotion budget is determined by the overall

promotional strategy. Objective end task method approach is the one which is
driven by strategy. This is also the most popular technique to decide the sales
promotion budget. The promotion manager starts by making a thorough study
of the market, the product, competition and consumer behaviour in order to set
up appropriate promotion objectives. These objectives may relate to increasing
short-term sales, introducing a new product, stimulate trial, increasing
distribution, etc., within a specified period of time. Next step is to determine
how much money would be necessary to accomplish each task involved in
achieving the objectives. If the costs happen to be more than the money
available, then either the promotion objectives adjusted or more funds are made
available from the contingency reserve or by reducing the budgets of the other
promotional activities.
SALES PROMOTION EVALUATION
Measurement of results in any area of business activities related to the objectives

that are set. To accomplish this, set of evaluation criteria is laid down before the
implementation of the sales promotion programme. A number of these
objectives are directly related to sales. In all such cases, the measurement does
not pose any complexity and the sales based techniques can be used with relative
ease. For instance, it is quite easy to measure the sales effect before, during and
after the sales promotion. In case of objectives not related to sales, such as trial
purchase, or changing consumer awareness and attitude as resultant increase
and perceived value of the product, measurement is more difficult. In certain
types of promotion, the reseller support is important and can have significant
effect on marketer's promotion performance.
♦ Pretesting
How sales promotion is to be communicated and what would be communicated

to the target groups is important and can be pre-tested. For example the pre-
tested may find out what is likely to be the perceived value and the risk. A
customer considers whether it would be wise to buy an unknown brand of sport
shoes at a 45% discount. In this offer was there a risk of buying an unfamiliar

brand? The pre-test can be conducted to assess these factors by using focus
groups and consumer panels. Another approach, ballot method, consists of
kneeling a ballot paper to a list of consumers. They are requested to evaluate
different illustrated promotion is and vote for the most light and return the ballot
to the firm. A relatively expensive but more accurate method is a portfolio test.
A portfolio of sales promotion is prepared and shown to consumers in person
and the responses are noted.
To test consumers behaviour responds such as trial purchase, repeat purchase,

etc., pretesting consists of experimenting in certain markets for individual stores
in a market. All other factors remain the same; only the sales promotion device
being tested is the variable that is manipulated.
It is often quite helpful to evaluate the responses of resellers before

implementing the promotion programme. The simplest ways to visit several
important retailers and wholesalers, discuss the programme and seek their
opinion and suggestions. This may prove to be quite favourable in case the
support of resellers is considered to be of paramount importance for promotion
results.
♦ Concurrent testing
This testing is done when the sales promotion is in progress. Concurrent testing
the permit the promotion manager to modify the sales promotion, if needed
This type of testing is conducted in terms of sales data which can be obtained on
a weekly or monthly basis. If the promotion is a consumer contest and the
consumer is not require to purchase anything, the response to promotion can be
adjudged by the number of entries received at some interval and if need be, the
contest period can be extended. In case of a coupon distribution programme,
similar approach can be adopted by keeping track of coupons redeemed.
♦ Post testing
Post-testing is done after the promotion period is over. To assess the changing
consumer awareness and attitude, telephone calls, questionnaire mailed to the
consumers and personal interviews can be used. In these methods, the most
expensive is the personal interview method and the least expensive is the mail.
The information sought pertains to the promotion event. In case of samples on
premiums distributed through retail stores, intercept interviews at the Point of
Sale can reveal more reliable information.
To measure the sales affect, sales figures before the promotion period can be
compared with figures at the end of promotion and one month after the

promotion ends. Suppose that the promotion objective was to increase sales by
30 percent in certain period and the pre-promotion sales for a similar period
were worth 5 million rupees. The sales jumped to in excess of 5.6 million in the
promotion period. This would show that the objective was achieved. It is very
likely that in the ensuing month after the promotion, the sales will come down to
say 3.5 million rupees. In the sales return to 5 million rupees on the long run,
then perhaps the sales jump is because of brand features and deal prone
customers. However, if the regular sales settle at 5.5 million rupees on the long
run, then definitely the promotion prove successful in increasing the long run
sales by attracting new customers and we have also attracted customers away
from other competing brands.

PROMOTIONS
CASES
PRODUCT CATEGORY: FMCG (beverages)
PEPSI
The company believes that sales promotions are an integral part of their overall
marketing strategy.
Sales promotions are carried on at 2 levels –
§ Customers i.e. trade
§ Consumers
Why trade promotions?
Trade promotions are essential for 2 major reasons:
§ Drive volumes – the main objective of any sales promotion is to increase

sales.
§ Visibility – the category demands not only volume, but also increased
visibility in order to build the brand.
Trade promotions are comparatively easier to implement because the audience is

smaller, direct contact is maintained as company salesmen are in continuous
interaction with the dealers.
SUCCESSFUL TRADE PROMOTIONS:
“Aha Bar Mein Jar”
Product: Pepsi Aha
Objective: Launch of Pepsi Aha and to induce trials.
The Rationale:

The company realised that it is essential to gain entry into the market first before
carrying out consumer promotions. So the company decided to focus on bars to
enter through a specific channel.
The company based on a research identified the waiters as the major influencers
in purchase of drinks in bars. So in an effort to induce trials of Aha among the
consumers at bars, Pepsi launched the “Aha bar mein jar” offer.
The Promotion:
There were huge jars, branded and packaged as Pepsi Aha placed at the bars.
The waiters were required to fill up the jars with Pepsi Aha crowns. After which,
they would receive gifts and prizes from Pepsi.
The Result:
The campaign resulted in:
§ Increased Volume Sales
§ Improving the equity of Pepsi among waiters.
§ Created consumer preference for the brand.
CONSUMER PROMOTIONS:
Consumer promotions are identified at Pepsi at 3 levels:
§ National level
§ Local Level
§ Key A/c’s Specific
The two major objectives for the promotions are:
§ Volume growth
§ Brand building
For instance the campaign in Pune wherein Fardeen Khan visited 10 colleges in
Pune may not drive volume sales but did enable top of mind recall for Pepsi for
a very long duration.
Key Accounts:
Key accounts could be, for instance, all pizza outlets across the city or any
specific pizza outlet like Pizza Hut wherein Pepsi conducts specific sales
promotions campaigns.
Key accounts specific promotions are carried for certain major reasons:
§ They act as volume drivers.

§ They aid in image building – e.g. If Pepsi ties up with Restaurants, then
their food – Pepsi association becomes stronger. Likewise the Pepsi cricket
Association will be reinforced through their forthcoming campaigns for
the cricket world cup.
§ They act as reactionary tools to counteract competitor’s strategies.
Promotion could be of two kinds:
§ UTC (Under the crown)

§ SLP (gifts, labels, accessories)
Timing of Promotion:
§ Seasonal
During Ganpati festival Pespi promotes the Mangola brand through
contests to leverage the association between Mangola and Mumbai.
§ Reactionary to competitors strategy:

With Maaza’s strategy to offers tattoos to their consumers, Mangola is also
gearing up to offer promotions.
§ Launch of a new brand:
Besides this during monsoons, sales are pretty low so the promotions are
directed accordingly. Like wise the brand intends to leverage their promotions
on the forthcoming movie ‘Khushi’ that stars their brand ambassadors; Fardeen
Khan & Kareena Kapoor. Also the company is gearing to use the forthcoming
cricket world cup to the hilt.
PEPSI AHA
Objective: To induce trials
Timing: Summer 2002
Vehicle: Games and contests
The Promotion:
The company spent 3 weeks identifying four major channels through which
their promotions would be directed at the consumers. They include:
§ Eateries
§ Theatres

§ Schools & colleges

§ Pubs
The companies decided to use games to entice the consumers. The deal was
that the consumers would play a lot of games and win Pepsi – Aha as prizes.
The games had to consider the ‘brand values’ Pepsi – Aha aimed to be
identified with.
They selected Johny A as their brand personality. The games included jigsaw
puzzles that had the image of Johny A and hoopla games.
Result:
Consumers’ response to the promotion was very effective. The enthusiasm
generated by this promotion among kids and teens ensured a high top-of-mind
recall for the brand.
However, the top line marketing was not upto the mark and was responsible
for the poor sales of the brand. The television ads and hoardings were not
effective enough to persuade the consumers to purchase Pepsi Aha.
Pepsi – Mera Number Aayega Campaign
Offer: Prizes including cash prizes to be won
Platform: National level
Vehicle: Under-the-crown contests
Communication: The promotion was communicated through television

personality Cyrus Broacha using television and newspaper media along with
outdoor advertising to communicate the campaign.
PEPSI STORYBOARD:
Children are playing on Dejected, he asks the

swings. A young Cyrus is maid,
waiting for his turn, but is Mera number kab
pushed aside by other aayega?" .
kids. "Aayega baba number,"
she assures him.

A few years later, at a Disappointed yet again, he

basketball court all the guys tugs at the coach's shirt and
are selected, except our Cyrus. asks, "Mera number kab
aayega?"
VO: "Ab to aa hi jaayega. Drink

Pepsi, collect...
I won, I won," exclaims a guy This time our boy Cyrus

does not lose hope as
Now in college,
standing next tothe youngsters
Cyrus at an ...Cyrus misses by a hair's
he convinces himself,
decide
open-airwho gets
cafe. to kiss
Cyrus girlsat
looks byhis breath. "Mera number kab
"Mera number aayega."
rotating a bottle of Pepsi. Here aayega?" wails our perpetual
luckless crown.
too... loser.
...numbered crowns and you
could win lakhs every week."
Promotions that failed to deliver the results:
Mangola Ganpati Promotions 2002:

The company had conducted certain contests through advertisements in local
Marathi newspapers (ex: Loksatta). However the campaign failed to generate
any response.
Promotions in Pubs to leverage their tie up with Deep Purple Band: This was a
case of selection of wrong channel which Pepsi realised a little too late. Pubs
do not permit companies to put up posters in their premises. Added to that the
people frequenting the pub wanted a variety of songs to be played and not just
deep purple songs. After this experience the company has decided not to
venture into pubs for promotions unless the product category favours it, (like
Shock and Baccardi Breezer)
Evaluation of the campaign:
The company measures the success of the campaign based on consumer health
i.e. top of mind recall. Although sales volume matters, the company lays stress
on building brand equity.

PRODUCT CATEGORY: FAST-TO-COOK SNACKS
MAGGI
Introduction:
Maggi Noodles was launched in 1982 as a tasty treat for children, with a strong
fun element communicated in the brand’s advertising. The packaging was bright,
innovative and attractive. The brand appealed to mothers because it was
convenient, taking only 2 minutes to prepare, and because the price was very
affordable. Initially it was a runaway success.
Two problems emerged subsequently. Cost escalation forced the company,

Nestle, to increase the price. Secondly, it became clear that the user base was fast
changing and expensive continuous advertising was required to maintain sales.
The need was to establish and stabilise a core franchise of loyal regular users
among children under 14, especially those aged 8-10 who had been identified as
the biggest fans of Maggi Noodles.
As a sales promotion campaign they formed the Maggi club.
ANALYSIS:
Objective:
To build a core franchise for the brand by establishing an ‘ongoing dialogue’

with young children over time, by means more closely targeted and less
expensive than continuous mass media advertising.
The Promotion:
Children under 14 were invited (by press advertisements and leaflets distributed
in select schools) to become members of a Maggi Club, by sending logos cut from
5 empty wrappers of Maggi Noodles.
Members received a club membership Card and a list of gifts of fun activities for
the year ahead, since ‘Maggi Clubbers are Fun Lovers’.

Gifts such as:
§ Snap Safari Game

§ Laws Of The Jungle Game
§ Cap And Mask Set
§ Disney Today Comic
§ Standees Set
§ Travel India Game
To obtain each of these items, the Club Member was required to send the
application with 5 proofs of purchase of Maggi Noodles.
Details were also mailed to Members of special privileges negotiated for them by
the Club from time to time, e.g. discount tickets at ‘Appu Ghar’.
Results:
The enrolment of members was extremely successful. In fact members were so

far above target that there were some difficulties in coping with applications.
The membership of the Maggi Club has grown by more than 75% per annum
subsequently. These members represent an expanding core franchise of regular
users of the brand.
Clubs are an attractive concept for any marketing executive looking to get
‘closer’ to regular consumers of his brand. They are especially attractive when
children are the consumers: many children like belonging to a ‘gang’ and love
receiving mail addressed to them personally. A club gives the brand the
opportunity to talk direct to the child, without the intervention of the mother
who is so often – as with Maggi Noodles – the purchaser of products designed
for child consumption.
The Maggie scheme had no ‘frills’, all of which would cost money. It
concentrated single mindedly on encouraging regular usage of Maggie Noodles
by offering a wide variety of attractive gifts in return for multiple proofs of
purchase.
Membership grew to a size where it also represented a valuable direct-marketing
database for other Maggi/ Nestle products.
MAGGI correcting its mistake:
The company failed to cash in on the success of Maggi Clubs. Further,

discontinuation of the successful Maggi product and replacing it with a new

variant hit the company’s sales really hard. For the first time in years, Nestle saw
its dominant position in the instant noodles market challenged by Indo-Nissin's
Top Ramen. In an attempt to rejuvenate the old Maggi, the company planned to
relaunch Maggi through a planned sales promotion campaign.
Setting the ball rolling was the Maggi Fun-Dooz promotion and online contest.
The promotion and contest were meant to take forward the `ab sab kuchh pehle
jaisa' feel associated with the relaunch of Maggi noodles with the original
flavours.
Objective
The Maggi Fun-Dooz promo was poised to drive the brand to new heights,
reward loyalists, bring back lapsed customers and bring new consumers into its
fold.
Promotion
Fun-Dooz, as the nomenclature suggests, is a set of 16 `fun to do' and `great to
play with' three-dimensional puzzles which, when put together, could build up
to a Toyland and `Zoomies': a dream house, a fast car or even a fighter plane!
The Fun-Dooz puzzles are available with 400g packs of masala flavour Maggi
noodles. Completing the 16-piece puzzle first would fetch the winner a Fun-
Dooz watch, while for anyone who manages to put together eight different
puzzles, there are board games to be won. In the past, Maggi has given away
dinky cars and waist pouches as prizes in exchange of a set number of noodles
packs.
Supplementing the Fun-Dooz promo, is a Maggi-2-Minute Fun-Dooz contest on

the net (www.contests2win.com) lending a touch of modernity to the
promotions. A participant could win prizes such as music CDs on answering
three questions correctly.
The company also has plans to rejuvenate the almost forgotten `Maggi Club' for
young children. The club, which had a database of almost 2 million kids, sent out
games and puzzles to members in an effort to keep their interest in the brand
alive.
Results
According to company executives, sales have improved dramatically since the
old flavour was brought back.

CATEGORY: OTC PHARMA
IODEX POWER CREAM
Iodex isn’t only a dark brown greasy stain-leaving balm, in an equally primitive
bottle. It’s also a white, washable non-staining cream in a contemporary tube.
Then why hasn’t the latter image replaced the former? SmithKline Beecham
Pharmaceuticals is working hard on that making the contemporary image of the
age-old brand stronger.
The legendary Iodex in the green bottle contributes to about 90% of the total
iodex sales. But the power cream is showing only modest growth. The reason
being that Iodex Power Cream was a not-so-early entrant. Moov was already into
tubes and quite established in the market. Creams are still in the nascent stage
however. Today iodex and Moov are the only key brands available. Himani
Cream was launched recently in the same segment.
In the past ten years, the category has clocked a growth of 3-5%. The cream, which SKB
believed, would help category growth contributed just 3%. So this year they decided to do
something different, which can actually trigger growth. A blind test done by the research
agency showed that the Iodex Power Cream was the preferred brand. So the company
decided that if the brand was good, they should stand by it. They came up with a money-
back guarantee scheme quite unique in the OTC category.
Timing
July 25th – September 30th
Where
Test marketed in Tamil Nadu and Karnataka. National launch in the first week of
August.
Offer
The money-back offer was exclusively for backache. (Though the product works
for any kind of pain)
Publicity
In-shop promotion in Chennai and Bangalore and national advertising
Rationale

“Commercials do get noticed but are not very effective. A consumer feels good
when she can see the product, open it, smell it and apply it”
Story board:
A woman buying flowers is But she is not interested

approached by a salesman and politely refuses
selling Iodex Power Cream him
But the salesman is "Woh nahin madam, yeh,"

persistent he says, referring to a
so she loses her cool and competitor brand.
asks him to "move."
"Kamar dard se poora The lady smiles and is

aaram dilaye," convinced
the salesman says. about the claims made
Super: Fouran by the
aaram, nahin to poora salesman and agrees to
paisa wapas. try it out

Results
Power cream now contributes about 10% to the overall Iodex portfolio.
What the future holds?

The company believes that if the cream segment moves, there will be a positive
rub off on the entire Iodex brand.
PRODUCT CATEGORY: ORAL CARE
CLOSE UP v/s COLGATE
Close-up:
Its initiative ran under the banner ‘Sky Party with Hrithik Roshan’. This was a
part of a nation-wide contest that commenced on Feruary14, 2001, with a final
scheduled on April 26, 2001.
The contest culminated in Mumbai with a star-studded dinner and an airplane
ride for 30 lucky winners with the famed film star on board. The idea was
simple. Consumers had to fill in some personal details on the inside of any close-
up pack. The empty pack could be dropped in at collection boxes placed at
convenient locations in selected cities. A draw of lots determined the lucky
winners who would be flown to Mumbai to participate in the Sky-Party.
Colgate:
For a long time in the paste wars (all through the early and mid 1990s) it looked
as if Colgate Gel could not match the power of the Close-Up proposition. Since
Close-Up was gaining increasing popularity because of its ‘Sky Party’ Colgate
also hit right back.
It launched its ‘Colgate Ke Andar Kya Hai’ promotion that had been uniquely
designed to reward consumers for every purchase they made under this
promotion, according to Colgate-Palmolive. The consumer had to cut-open the

wrapper and place a mirror against the inside of the pack to read what has been
won. In the case of toothbrushes, the consumer has to scratch the silver pack on
the packing with a coin to find a gift. There were 10 first prizes of Rs.10 lakh
each, 50 seconds prizes of Rs 1 lakh each and 100 third prizes of PC’s and
Palmolive-Natural soaps. The prizes range included kids’ activity books and
Palmolive skincare booklets with Rs.3 discount coupons.
ANALYSIS
Objectives of the promotions:
Close Up – objective of the promotion was to strengthen and connect with

today’s youth.
Colgate – the promotion was launched with the objective of growing volume and
market share and to compete with Close-Up in the fresh-breath segment where
gel pastes are a huge success and Close-Up was the market leader while
delighting consumers with a hidden surprise in every purchase.
Medium of communicating the promotions

Close-up used a multi-media approach in reaching this contest to its consumers.
Print, radio, TV and the Internet were used extensively to create visibility and
excitement, as also to encourage participation.
Colgate’s promotion was supported by outdoor advertising, TV and press

campaigns and a POP (point of purchase) support plan.
Pull Strategy/ Push strategy

Both of the companies used pull strategy that motivated the consumers to go to
the retail outlets and ask for their respective toothpastes. These promotions
required the minimum support from the retailers.
Types of promotions
Close-up used an event with a celebrity specially leveraging the popularity of
Hrithik Roshan after the success of ‘Kaho Na Pyaar Hai’ as a promotional tool
that also included sweepstakes.
Colgate used discount coupons, gifts, prizes and contests as the promotional tool.
Results
The efforts of both the companies paid off in terms of higher consumer
involvement. This is a good example of how two companies in the same segment

used different promotional strategies to attract the audiences and in respect to

their brand images.
The promotions also aimed at creating awareness in the rural market, where the
penetration of tooth-pastes is just about 42%. The consumption of toothpaste is
about one-third of the urban consumption. Companies have to find the link
which will make the market grow and this will come through the power of the
brand.

INCREASING READERSHIP – THE A&M EXPERIENCE
A&M, a magazine for advertising and marketing had launched a sales promotion
scheme to give the much-required boost to its sales. The sales promotion scheme
was advertised in the print media i.e. newspaper (Times of India).
OBJECTIVE
To increase customer base and readership.
ABOUT THE SCHEME
The scheme was an attractive subscription offer launched for the purpose of
increasing the readership of A&M. the scheme offered heavy discount on the
subscription rates of the magazine for the periods of 1, 3, and 5 years. Not only
this, the scheme also offered free gifts with subscriptions of 3 and 5 years
duration. The free gifts included a Videocon Digital Organiser with a 5-year
subscription and Braun pocket shaver with a 3 year subscription. The details are
as follows:
Subscriptio No. of Newsstand You pay Effective Free gift

n issues price Rs. saving
Term @ Rs. 50
5 yrs. 120 6,000 1,995 66 % Videocon digital
diary
3 yrs 72 3,500 1,395 61 % Braun pocket
shaver
1 yr. 24 1,200 695 42 % -
OTHER HIGHLIGHTS OF THE SCHEME WERE:
25 early bird prizes of Videocon KT 3113 Walkies.

Fabulous prizes to be won by lucky draw of all new subscribers. The prizes
included Honda City cars, Holiday package to Goa and Mussourie, Videocon
refrigerators, washing machines, air conditioners, Toshiba Colour TVs, LML
scooters and Kenwood car music systems.
The scheme also offered flexibility in the mode of payment for the subscription.
The payment was accepted either in the form of cheques, demand drafts or credit
cards. The delivery of the first issue, as well as the free gift was promised to be
done within 4-6 weeks of receiving the subscription form.

WHY WAS THIS SCHEME LAUNCHED?
The main reasons for launching the scheme was to boost the sales of this
magazine.
The magazine at a price of Rs. 50 was perceived to be an expensive magazine. So,
Spectrum Magazines Ltd. thought of introducing a special subscription offer for
A&M. they realised that the customers would prefer to subscribe to an expensive
magazine if an attractive offer was placed in front of them.
Secondly, its nearest rivals, Business Today, Business India, and Business World
had also launched their respective offers. So, to counteract this action, it became
necessary for A&M to come out with their own subscription offer, much more
attractive than other magazines.
Thirdly, A&M realised that it was the only magazine which specialised in
advertising and marketing and there was no close competitor for the same. So it
could easily snatch away the readers of those business magazines who found
A&M out of their normal reach.
SCHEME DURATION
The scheme was launched on the 6th of October 1998, and lasted till 15th
November 1998. The duration was of sufficient length; neither too short, nor too
long. This duration was proper because it gave the readers sufficient time to
think about whether to avail the offer or not. The scheme was launched keeping
in view the festive season of Diwali when the consumers are keen to buy new
things or entering into new ventures.
OUR STRATEGIES FOR A RELAUNCH
As is common knowledge, A&M has shut shop. But, if due to some reason it decides to
relaunch itself, we have the following sales promotion strategies for them:
Objectives
First of all we need to set the objectives. The main objective would be to induce
the original readers to continue, and broaden the base.
Target market
They would therefore be required to define their target market properly. The
main target market is a working executive in the field of marketing and
advertising.

Strategy
A&M first needs to reduce its price, because no amount of sales promotion
would work if the product were itself so expensive.
Further, today all magazines offer discounts and free gifts, due to which the
consumers have actually got bored.
In the first month or so, they should have these free gifts, so that people actually
wanting those free gifts would purchase the product. But after those sales have
dried up, A&M would require to innovate its promotions.
It could launch a ‘voracious reader scheme’, wherein at the end of each
month/fortnight, a competition would be held in which all subscribers would be
invited. This competition would include a quiz, a crossword, etc based on the
contents of the magazine of that month/fortnight. Plus they would write about
what they learnt from that issue.
The top 3 will be selected and their names would be published in newspapers,
magazines, etc. in addition to giving away some free gifts.
What the above strategy will do is not only increase sales, but also increase
readership. The root cause of discontinuation of subscription is that people don’t
read and hence think it’s of no use subscribing. These competitions will urge
them on to read even when they are pressed for time.
What this will also do is make people aware of the quality of articles appearing
in A&M.
Therefore, even if the scheme gets discontinued, readers won’t change because
now they actually know what the quality of A&M is.

PRODUCT CATEGORY – CONSUMER DURABLES
GODREJ Vs SAMSUNG washing machines
Objectives
Godrej: to increase market share

Samsung: to combat competitors’ strategy and protect their market.
Type of scheme
Godrej
1. Customer promotion scheme
Here the customer is benefited.

The company is following this scheme by giving rebate on the original price
of the product (it cut down the price from Rs. 14,999 to Rs. 13,000). It is also
giving a free gift (a VIP suitcase) and special loans to its customers. It is
charging 0% interest loans for its products to the customers.
2. Trade promotion scheme
Here the middleman (retailer) is benefited.

Godrej is giving 10-15% of the profit to the retailers if they are unable to meet
a specific target.
Samsung
Customer promotion scheme.

Samsung is giving rebates on the original price of the product (its fully automatic
washing machines worth Rs. 21,000 are now costing Rs. 18,000), and are also a
giving a free gift (a camera).
COMPARISONS
Godrej Samsung
Loans 0% interest loan Not applicable

Free gift VIP suitcase A camera
Service More service points Limited service points
Price Less High

Product range Large - (semi & fully Limited - (fully

Automatic washing Automatic washing
machines) machines)
Result of scheme
Sales of Godrej went up by 70%.

Sales of Samsung went up by 30%.
Analysis
The free gift of Godrej (the VIP suitcase) has more utility, is a necessity, and is
required by all classes of people.
Whereas, camera is a sort of luxury item and is required only by specific classes.
Hence, the strategy of Samsung is that of a follower and they are playing
defensive.
Recommendations
Samsung should have had an exchange offer and contests instead of following Godrej
and giving a free gift.
The exchange offer would have attracted many second or third time buyers,
more so because it is a foreign company.
Contests would attract first time buyers who would like to have an experience while
deciding.
Moreover, product features do not differ much in this case and hence the final
decision is influenced by sales promotions to an extent. It is here that Samsung
should have used their creativity and had a promotion, which would have
attracted both, first-time, and non-first-time consumers.
Recently they have come up with the ‘phod ke dekho’ and ‘phir se phod ke dekho’
promotions, which are not run-of-the-mill. Even here, free gifts are being given
away, but the important thing is that the promotion has been packaged
differently in the form of a plastic nariyal (coconut). Even the selection of the
nariyal is significant because in India, there is a tradition of breaking a nariyal
every time something new and good is about to be commenced. It is a symbol of
good luck.
Thus, this has really caught on the fancy of many a consumer and sales have
picked up at a rapid pace.

CATEGORY – SERVICES – FAST FOOD INDUSTRY
DOMINOS
TARGET CONSUMER
A target consumer for Dominos is anyone who wants convenient food. The
major consumers of pizzas in India are the Kids, Teenager and the young
working class crowd. Dominos targeted these segments, however now they are
targeting “families” also. This is reflected in their current ads and promotions.
Dominos targets all those who are pizza lovers and young at heart.
Competition:
Dominos believes that every food outlet that exists in the vicinity of its own pizza
outlet constitutes competition.
Objective:
Increasing the appetite of an individual customer by providing incentive to buy a
larger pizza.
Expanding to target ‘families’ as consumers.
Dominos introduces offers, schemes and launches new product variants every
quarter to ensure awareness among its customers and accomplishes its brand
building exercise.
Promotion:
§ Free coupons sent as fliers that enable customers to save a certain amount of money
on their orders.
Eg:Meal for two
Buy a medium 10 pizza with any one veg topping for RS 99<save Rs40>
§ The most recent scheme of Dominos is introducing garlic breadsticks free with every
large pizza worth Rs.199 or more. This has also been advertised through television
that shows a family as the target audience for this scheme.
§ The neighbourhood of the week scheme . They identify a potential area where
demand has not picked up yet, after which they concentrate on the selected area and
ensure increased sales through various promotions.
§ They have a customer loyalty programme whereby they maintain a database of their
regular customers and keep them informed of all the new schemes, discount
offers,etc. They are also sent discount coupons through direct mailers which acts like
a reward to the star customers and delights them.

§ Dominos had another offer which was called the U-buzz offer which was a tie-up
with AirTel.
DOMINOS – SALES FORCE PROMOTIONS

Dominos inculcates the core values of the company into its salesmen and
provides them with a lot of incentives which help them push the group.
When a new store is opened, Dominos has certain opening incentives where they set a
benchmark on the basis of expected sales (average weekly unit sales) and once the store
achieves this target, the store manager gets a reward of $500.
• International and National Level Awards

These incentives can be termed as attractive because they actually are given
to the selected few who have excelled in some area and are then rewarded
at an international conference and they are rated not just within their
country but on an international level. For instance say ‘The Manager of the
Year’ will have nominees from all over the world and the person getting
this title will have earned it out of 7000 outlets the world over.
• There are 4 levels of challenges (each of them) stretching through a 13 week

period at the end of which the sales are compared to those of the
corresponding period of the previous year.
§ Silver Challenge
This challenge requires a store manager to achieve a 25% increase in
sales and if he manages to do so then he is awarded the silver cap and
pockets a cash prize of 250$.
§ Golden Challenge
This challenge requires a store manager to achieve a 50% increase in
sales and if he manages to do so then he is awarded the silver cap and
pockets a cash prize of 500$.
§ Platinum Challenge
Here the percentage expected is 75% and the cash prize increases to
750$
§ Diamond Challenge
Here with an expected increase of 100% this becomes not only the
toughest challenge but also the most coveted one.
As we can see, with all these challenges the status goes on rising and so
does the cash incentive. Other than this the person receives international

recognition through acknowledgements meted out to him in the

“Pepperoni Express”. In case of the award category “Rookie Manager of
the Year” the person selected wins a trip to Las Vegas and Miami.
Incentives at the Local Level:

• For each store manager his store is his “baby” and he has staff welfare fund
allotted to him and the store manager has got discretion to use this budget.
He uses it as a “carrot” theory to improve the productivity of the team
members. He could do this in the form of free movie tickets or free pizzas
etc.
• Pins and badges are awarded to team members recognizing their

achievements.
• They have various ‘star ratings‘ for different stores. Owing to this every
store puts in their best to acquire the ‘five star rating’.
Medium of communication-
Dominos believes firmly on the principles of direct marketing. The area of
operations of a Dominos outlet is restricted and hence mass advertising does not
benefit it in any way in the sense that any leads generated as a result of it shall be
nullified as it will not be able to service such orders that are outside its purview.
Therefore it Communicates with its customers through
• Sponsorships at festivals,
• Sachin VISA tie-up,
• Fliers
• door hanging
• Media for brand building - TV, Times of India
• VISA
• ABN AMRO
• Cartoon Network
• Jet Airways
The core promotional activity performed is door hangings. They have a unique
design and each hanging is complete with its own set of schemes and offers to
lure the customers.
The task of reaching the hangings to every house is done between 1-3’o clock; during the
time when the number of orders are minimal. It is ensured that every house in the locality
is covered and no stones are left unturned in reaching the fliers to the houses of the
regular customers, if not all the people of the area.

Results-
The store manager of Dominos claims that after the launch of promotional
scheme there is a substantial increase in sales.
The most recent promotion i.e the garlic bread offer saw an increase in sales to
the extent of 45%.
CATEGORY – WEBSITES
INDYA.COM
Objectives-
Build the brand, get consumers online and make them come again and again to
Indya.com.
Type of promotions-
§ Offline promotions are as important as online promotions to indya.com in
order to build affinity to the brand as customers only interact with brands
that they have faith in. hence promotions were carried out at various access
points-TV, print, outdoors, on-ground and retail.
§ Promotions with Cyber cafés-
About 50% of Internet access in India is from cyber cafés. To capitalise on this,
indya.com has tied up with 950 cyber cafés (called indya cafes) across the country.
These cafes are highly suitable for promotions. This has mutual benefits says Neeti
Chopra, vice-president, alliances, Indya.com. “Indya.com drives traffic to the cafes,
which in turn provide a place for access to our site. Indya.com is the default
homepage in these cafes.
§ Online promotions-
Pioneered the concept of online movie promotions in India.
What were the promotions about?

Offline-
For on-ground and retail promotions, we have signed up with Delhi based
kidstuff.
Cyber cafes-
They have promotions targeted at free owners, like a free holiday for the owner of the
best done up cafe. Indya.com's Christmas promotion for instance was one wherein you
could win prizes if 'Santa singh' caught you surfing the indya.com website at any of the
Indya cafes.

Online promotions-
§ Launched J.P. Dutta's 'Refugee' in July 2000. Created Refugee.indya.com
where they gave insight into the movie and brought in consumer experience."
A similar, but more interactive, promotion followed with
Missionkashmir.indya.com.
§ For the first Independence Day of the new millennium, the portal launched
"Meri Marzi freedom poll" where users could vote for their choice of events,
institutions, personalities, news and other topics that have had an impact on
India post independence.
§ During the Olympics, the portal launched a new channel Olympics to let
users participate in interactive games and quizzes.
§ Some promotions were done in association with a couple of its partner
channels namely jobsahead.com and apnaloan.com. 'Smart Cv contest' in
October 2000 was a promotion wherein 15 candidates with the best resumes
won an interview with one of the top five companies in India.
§ Likewise, 'Become Lakhpati' was a promotion whereby any use of the right
four and quarter credit card on indya.com qualified for a lucky draw with a
prize of Rs one lakh.
Pull or Push Strategy ?

The company has used an efficient mixture of pushing the portal through cyber
cafes and pulling the customers towards the portal through their offline and
online promotions.
Their concept behind the promotion-

Says Chopra," our promotions are very simple. But we build usefulness into
brand, which in turn brings stickiness on the site. The idea and execution of
promotions reflect the weight and wisdom of indya.com. We learn from every
promotions and are able to fine-tune the next ones."
They enable everyday usefulness so that users keep coming back. The First day,
they may come for promotions. The next day they may come to read news
populist property for sale. They offer 44 products and services on-line
transaction oriented promotions or for various conveniences.'
Results-
Success on the Internet is based on unique brand building and Indya.com has
built the essence of it being a great brand through its promotions. It relates to the
ethnicity of India and has a vibrant attitude.
These promotions, the company claims have helped high brand recall for
indya.com in the Indian Internet space

INDUSTRIAL PRODUCTS
Generally for industrial products the kind of sales promotions done are
mentioned below.
Volume discounts:
On purchase of products over a ceratin quantity the custmer is given discounts
which vary from product to product and company to company.
Loyalty programs:
This are a very important part of industrial products. This is because once a
company starts buying a particular product form a particular company they stick
to that. Hence it is necessary to reward consumer loyalty.
Seminars and Conferences:
Seminars and conferences are a very important part. Most of the times getting
the consumer id done through seminars. For eg. A cement manufacturer foten
organizes seminars to educate the consumer about the product.
Microsoft Corporation (India) Pvt. Ltd.
Promotion: Microsoft Windows XP launch-October 2001

Objective: to make people aware of Windows XP operating system in India
City: Mumbai, Delhi
Strategy: From 10 days before the actual event, kiosks were set up all over the city to
invite people to use XP for themselves. They were the quizzed on the same, and upon
answering correctly, they were given free consumer passes to mega-event the launch.
In Delhi, Ansal Plaza’s amphi-theater and Mumbai’s Nehru center was converted into a
mini Consumer-expo with stalls of Compaq, Intel, Hewlett-Packard, Sony, HCl, and
NIIT apart from the main windows XP stall, games and activities were held inside these,
along with live demonstrations of XP features. This was a 2-day event and crowds
thronged the venues on both days.
SmithKline Beecham
Promotion: boost enerhgizer
Objective: To promote Boost sachet in offices.
City: Delhi, Mumbai, Chennai, Kolakatta, Hyderabad, Banglore
Staretgy: An extensive sampling promotion was undertalken for the boost energizer
sachet drinks in offices. Salesforce teams visited offices and personally handed over the
sample packs to the staff.

PROMOTIONS
TEMPTATIONS
Just one year after its launch in September 2001, Temptations hasalready
managed to garner a3% volume market sahre in the 9000 tonne or Rs. 550 crore
marketin India.
But the compnay realised just launching a revolutionary would not be sufficient,
it had to be backed by extensive promotions and advertising to ensure its
success.
Objective: To induce trials and increase market share
Promotions:
Numerous promotions and online contests were launched for the purpose. The
budget fixed for promotions were 1.5 crore.
Cadbury’s tied up with ICICI bank ATM’s and Teatres for its advertisements.
300 bars of temptations were given in a promotion in association with

Crossroads where in on a purchase upto a certain amount a free Temptations
was given.
The firm alos identified 60 upmarket restaurants where 80-100 bars of
tempatations were given away.
The firm tied up with Star network to launch online contests

§ “Tempting Treats”
The customer had to log on to www.temptationsworld.com click on the Star logo

and then answer a question based on the Star programme. The contest happened
between Feb2001 – April 2001.
The bumper proze for the winner was A ford Ikon .
§ “Sweet Surprises”
The contest could be entered through internet or SMS. The winners would get
atrip for 2 to Australia.
SAMSUNG DABAKE JEETO OFFER:

Digital technology leader, Samsung India Electronics Ltd., has launched a mega
promotion for the forthcoming Soccer event, called ‘Samsung Dabaake Jeeto’ Offer.
Objective:
Targets Rs.310 Crores worth of Sales from this Promotion
“Samsung Dabaake Jeeto Offer has been launched with the objective of
stimulating the market and optimizing the sales of our products during the
forthcoming Soccer season states Mr. R. Zutshi, Vice President Sales, Samsung
India
Timing :
This Promotion was live in West Bengal on May 1, 2002 and All India on May 10, 2002
was valid uptil June 30, 2002.
Promotion:
During the duration of the promotion, every Samsung Consumer Electronics or
Home Appliance product purchased by a customer entitled him/her to a Sure
Shot Alarm Clock from Samsung. The Alarm Clock waspacked in a Plastic
Football that was given to the Customer at the time of purchase. On pressing the
Football from the top, the customer gets the Sure Shot Alarm Clock and if he/she
is lucky, they will find a tamper proof anodized sticker of the gift on the clock.
The customer wins the gift etched on the sticker. This Promotion had gifts worth
Rs.10 Crores for the customer and the Dream Prizes for customers included
Samsung Digital Flat TVs, Frost-free refrigerators, Microwave Ovens, Karisma
Washing Machines, Mobile Phones, Cameras and Soccer 2002 Official licensed T-
Shirts from Adidas.
The total cost of this consumer promotion was Rs.15 Crores, including the Gifts.
The Company released new print and television commercials around this
Campaign and carried out ‘In-Shop Hungamas’ at select dealer counters in
Kolkata, Goa and Cochin to create visibility for this Campaign.

CINTHOL :
Cinthol celebrates 50 years of skincare with exciting promotional offers Cinthol

celebrates 50 years of skincare this August. India's first deodorant and
complexion soap was launched on 15th August, 1952 and in these 50 years of the
brand has crossed many glorious milestones.
The flagship brand of Godrej Consumer Products Limited, Cinthol is celebrating

its month long Golden Jubilee with exciting offers for both the trade and the
consumers.
For its consumers, Cinthol has launched a special Golden Jubilee offer carton
pack of three soaps. The offer is valid only on the Cinthol deodorant and
complexion soap. The special offer pack is in the striking original red colour of
Cinthol and is priced at Rs.50. The offer is available all across the country.
Cinthol has also launched a "Stock And Win" Golden Jubilee trade scheme in
which stockists can win a number of prizes including Cinthol gold coins and
diamond rings
GODREJ FAIRGLOW:
Godrej FAIRGLOW, the unique fairness brand from Godrej has announced the
launch of its VALENTINE SPECIAL on its website www.fairglow.com February
6, 2002, Mumbai : The VALENTINE SPECIAL is featuring a host of offers &
activities to satisfy the needs of young couples. The most amazing offer is the
SEND A ROSE promotion, whereby consumers have the chance of sending a
rose FREE to their valentine alongwith their message. Also, consumers can
participate in the very interesting 'Fairglow - Catch the Queen of Hearts' contest
and win Rs. 1000 everyday.
The VALENTINE SPECIAL also features interesting ideas like the Love -
greetings and E- kisses section where users can send these beautiful cards to their
valentine, the Dr. Love & Astro Love calculators where they can find out more
about their partners and the very interesting Love Poll. Users can also download
amazing wallpapers, love stationery and screensavers from the site.

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WHAT IS SALES PROMOTION?

Sales promotion refers to many kinds of incentives and techniques directed

“Sales promotion includes incentive-offering and interest-creating

Used to achieve short-term sales

Becoming too common

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Sales promotion has been traditionally viewed as a non-recurrent selling

• Services: CMC Computer Education offered a set of 3 CDs of Brittanica

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Many types of sales promotion require participation of customers who are

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1. Communication: they gain attention and usually provide information

Major users of sales promotions are marketers of soaps, detergents, toiletries,

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DIFFERENCE BETWEEN ADVERTISING AND SALES PROMOTION

Advertising Sales Promotions

By using a variety of persuasive appeals, it Besides giving reasons in the form of

THE ADVANTAGE OF ‘ADVERTISING FOLLOWED BY PROMOTION’ OVER

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Advertising then Promotion

RELATIVE COMMUNICATION STRENGTHS OF ADVERTISING AND

Category Brand Brand Brand purchase Purchase

The width of arrows denotes the extent of effectiveness

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REASONS FOR RAPID GROWTH OF SALES PROMOTION

The air of change is gaining momentum after the introduction of economic

♦ Customers Have Become More Price Sensitive

This increased price sensitivity is a direct result of rampant inflation. Economic

♦ Sales Promotions Generally Create An Immediate Positive Impact On

Advertising, personal selling and other methods of promotion produce slower

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♦ Products have become more standardised

In many product categories, there is a proliferation of brands; many of them are

As competition intensifies and promotions proliferate, consumers have learnt to

♦ Expectations Of Price Decrease

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♦ Advertising Has Become More Expensive And Less Effective

♦ Trade Has Become More Powerful

Retailers and wholesalers have become powerful and find themselves in a

♦ Emphasis On Sales Volumes

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♦ Sales Promotions Maximise Profits

A number of economic theories conclude that a company can maximise profits

♦ Introducing An Element Of Interest

♦ Impulse Buying Is Increasing

The number of marginal customers is increasing. Displays at the point of

♦ Sales Promotion Specialists Are Available

As a result of economic liberalisation, the number of management institutions

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Because of increasing number of brands, it is difficult for manufacturers and

ADVANTAGES OF SALES PROMOTION

Sales promotions have a significant effect on the behaviour of consumers and

Producers can introduce price discrimination through the use of sales

Price concessions are also offered in trade fairs and exhibitions.

♦ Effect on consumer behaviour

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Company/ Applicable Period

In our over communicated society and because of selective attention, it is not

♦ Effect on trade behaviour

Short-term promotions present an opportunity and encourage dealers to forward

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The aim is to speed up consumer purchasing from their outlets. Point of