Required fields are marked *. The goal is to identify and assess how changing elements of the marketing mix impacts customer behavior.. The present market situation shows that there is rapid growth of sales promotion though several factors have contributed to it, particularly in consumer markets. 1. In other words, the products are similar so promotions become the tiebreaker in the consumers’ decision making. (a) Promotion mix (b) Sales promotion (c) Trade promotion (d) Discount coupon 8. Consider all extra benefits and make priority of these benefits with a view to offering these to customers depending upon a particular sales situation. At the sales maximisation output, there are normal profits only and no supernormal profits/loss. The main idea of such assistance is to help the retailers to sell more goods and buy more from manufacturer. Wijewardena, H. & S. Cooray (1996). Do you expect a continued increase in the use of promotion throughout the following decade? 15 Importance of Sales Promotion to Producers. Sales Promotion of Industrial Products, 9 types of Consumer Sales Promotion tools, Outdoor Advertising | Kinds | Advantages | Disadvantages, Notes on Information Processing | 5 Important Stages, Loyalty Schemes | Co-op Dividend | Features of Successful Loyalty Scheme, Promoter | Duties | Extent of Liability | Remuneration, Weaknesses of Trade Union Movement in India and Suggestion to Strengthen, Audit Planning & Developing an Active Audit Plan – Considerations, Advantages, Good and evil effects of Inflation on Economy, Vouching of Cash Receipts | General Guidelines to Auditors, Audit of Clubs, Hotels & Cinemas in India | Guidelines to Auditors, Depreciation – Meaning, Characteristics, Causes, Objectives, Factors Affecting Depreciation Calculation, Inequality of Income – Causes, Evils or Consequences, Accountlearning | Contents for Management Studies |. By inducing more sales through sales promotion, inflow, of cash increases — This could be one of the objectives of the firm. This is due to the power shift in the marketplace from manufacturers to retailers. Answer to Describe the factors that have accounted for sales promotion’s rapid growth. iv. The dealer also informs the manufacturer about consumers’ demand pattern, their likes and dislikes, tastes and preferences, complaints and criticisms, substitute goods, competitive products and so on. 25 Major Benefits or Advantages of Branding. In case of bulky and costly goods which cannot be displayed physically, display materials, posters, show cards act as promotion materials. Whilst the above two considerations can be managed to an extent, external factors over which we have virtually no control are also going to have an effect on the business' growth. Sales increase as more customers become aware of the product and its benefits and additional market segments are targeted. Factors Responsible for Rapid Growth of Sales Promotion. Promotion is the direct way an organization attempts at reaching its market and is usually performed through In addition to the rapid advances in scientific discovery and in general-purpose Dominant retailers demand a variety of promotional incentives before allowing products into their stores. Advertising presents or promotes the product to the target audience through a variety of media such as TV, radio, cinema, online, social media and magazines to encourage them to buy.. The dealers are supplied with sales literature by the manufacturers. The importance of the service sector and more importantly the role of marketing inputs in services has been seen only in the last 20 years. Some studies have sown that readership scores are higher for print ads with coupons than for ads with them. b. Bonus: How to Choose Right Advertising Media Decision (15 Key Factors). As the consumer market becomes more fragmented, many companies are tailoring their promotional efforts to specific regional markets. Factors Responsible for Rapid Growth of Sales Promotion, How to Choose Right Advertising Media Decision (15 Key Factors), 17 Powerful Consumer Sales Promotion Techniques, 15 Importance of Sales Promotion to Producers. What is Collective Bargaining and Why it is Important to Workers? All of the factors listed below have played a part in that growth EXCEPT: A. In the early stages of sustained growth, government has often provided the incentives for entrepreneurship to take hold. Even though customer satisfaction has become the top priority for businesses, there are times when they need to stimulate demand and increase sales of their products for short-run. ADVERTISEMENTS: Advertising and Sales Promotion! quantify the key factors that are responsible for failure in small and medium-sized enterprises. (3) More external competition (4) Least difference among the brands (5) All of these View Answer / Hide Answer Once the product has been proven a success and customers begin asking for it, sales will increase further as more retailers become interested in carrying it. If your marketing and sales teams see themselves as a united force, at least 75% of your leads should be directly generated by marketing. Updated on: February 9, 2020 Leave a Comment. Thus, now you know the major factors responsible for rapid growth of sales promotion. growth and retarded Malawi’s social progress. All of the factors listed below have played a part in that growth EXCEPT: a. greater pressure to increase sales. A) ... She wants to evaluate the performance of her sales force that is responsible for the New England territory. The company can also motivate the dealers and distributors of their channel to perform better for their brand, and to get their stock moving. Entrepreneurship Theory & Practice 20 (1), 5-28. To encourage impulse buying and attract first-time buyers, sales promotion is used. Parity Products; 9. 1.1.1 The concept of sales promotion Sales Promotion is the widely used component of the promotion mix, other being personal selling, direct marketing, publicity and advertising. On-the-shelf promotion is another reason for its growth. increasing your product's market share; creating a brand preference for your customers; Product growth stage. Growth Stage: The growth stage is a period of rapid revenue growth. These conditions may have both positive and negative influences on the emergence of entrepreneurship. Economic growth - Economic growth - The role of government: The differences in rates of growth are often attributed to two factors: government and entrepreneurship. Another reason for sales promotion’s growth is that it is relatively easy and quick to determine whether a sales promotion strategy has accomplished its objectives because there is usually an immediate response of some kind. 3. Companies that fail to comply with retailers demands for more trade support often have their shelf space reduced or even their product dropped. Finally, an increase in the size and power of retailers … At this point in your product's life cycle, you should be putting your efforts into:. No physical retailer can have the kind of assortment of products that we have,” observes Praveen Sinha, co-founder of online retailer Jabong. The following promotions work very well in services marketing. Their sales literature includes literature of all aspects of sales that assist dealers in making a sale. Retail prices soared during the inflationary 1970s because of the increased costs of labour, raw materials, and manufacturing. This is where sales promotion comes into play. Two additional factors have contributed to the increase in international trade and industrialization in South Korea: An improvement in the business environment; Policies incentivizing investment in innovation; Environment and Innovation. A major aspect of many firms marketing strategies over the past decade has been the development of new products. The manufacturer offers a number of attractive terms to dealers in order to induce them to buy an article. The ancient Babylonians and the Romans contributed significantly to the early growth of advertising. Redemption rates for coupons or figures on sales volume can be obtained within days. SALES PROMOTION •The set of marketing activities undertaken to boost sales of the product or service •Process of persuading a potential customer to buy the product. All of the factors listed below have played a part in that growth EXCEPT: Greater pressure to increase sales. Sales promotion can be effected in several ways. Many companies are demanding to know what they are getting for their promotional expenditures. Choice of right sales promotion strategies has become important today. Sale… Methods of Sales Promotions | Reasons for Growth of Sales Promotion, 4. Sales increase as more customers become aware of the product and its benefits and additional market segments are targeted. Companies face more competition. RAPID GROWTH OF SALES PROMOTION • Sales promotion tools are used by organizations, including a. Over the past 20 years, I have observed 10 recurring risks for growing business and have helped clients address them. India is standing on the threshold of retail revolution. The internal problems included poor weather and poor agricultural pricing policies which favoured the estate sector against the smallholder farmers. Firms may offer contests to attract customers by offering substantial cash or merchandise price cuts. There is need for a cordial relationship between the manufacturer and the dealers i.e., wholesalers and retailers including the agent middlemen. retail sales, which is projected to reach $253.8 billion for 2012. Several factors have contributed to the rapid growth of sales promotion. Top 12 Strategies & Policies of Pricing in Marketing. The following are some of them. The dealers are also given detailed information about the process of manufacture so that they can answer customer queries more efficiently. With sustained growth and rapid growth though there is a risk of overpopulation. Trading stamps are a special type of premium received by customers, which can be redeemed for merchandise through stamp redemption. 1. Another factor that led to the increase in sales promotion is manufacturers reliance on trade and consumer promotions to gain or maintain a competitive advantage. the battle is for market share rather than general product growth. Two main environmental factors that have led to the growth of tourism: Good climate: Good climate is one of the most important features of attraction for any tourist place. In most industries. Survival and employment growth contrasts between types of owner- managed high technology firms. Sales promotion c. Online advertising d. Public relations Answer: (b) 158. To increase worth of raw goods, you must add value to it by processing and packaging it for the consumer. Similarly, sales force contests are arranged to stimulate the efforts of the salesmen. Bonus is usually offered to salesmen who sell in excess of the quota. which of the following factors has most likely contributed to the rapid growth of sales promotion, particularly in consumer markets? Shoppers today are better educated, more selective, and less loyal to brand names than in the past, which means they are more susceptible to switching brands. The main factors which have contributed towards the growth of multinational corporations are given below: Market Expansion : The growth of GDP and per capita income in various countries led to increasing demand for goods and services.Companies in developed economies, explained their operations overseas to exploit the expanding markets abroad. The tools of sales force promotion are bonus, sales force contests, and sales meetings and conferences. Samples are freely distributed with the product purchased for the purpose of obtaining consumer acceptance. Consumer Promotion is useful for promoting new product. Top 10 Need & Importance of Workers Participation in Management. Advertisers, therefore, are exploring marketing communication forms that cost less and produce immediate, tangible results. If your marketing and sales teams see themselves as a united force, at least 75% of your leads should be directly generated by marketing. *FACTORS CONTRIBUTE TO THE RAPID GROWTH OF SALES PROMOTION *PURPOSE OF SALES PROMOTION *MAJOR DECISION IN The present market situation shows that there is rapid growth of sales promotion though several factors have contributed to it, particularly in consumer markets. Which of the following factors has most likely contributed to the rapid growth of sales promotion, particularly in consumer markets? The sales promotion department assists the salesmen to contact the prospective customers. Introduce a New Brand. Also Read: 9 types of Consumer Sales Promotion tools. A) declining interest in quality B) declining advertising efficiency C) rising hostility toward large firms D) increasing popularity of e-procurement E) increasing number of international firms 11 Factors Affecting Economic Growth in Nigeria. Your profits should rise through an increase in output and more competitive pricing. This may induce dealers to buy products introduced by the manufacturer. Promotions typically offer the consumer added value. China’s Economic Rise: History, Trends, Challenges, Implications for the United States Congressional Research Service Summary Prior to the initiation of economic reforms and trade liberalization nearly 40 years ago, China Sometimes, customers are given the product at a price below the normal rate. To main the high production capacity, a company may go for sales promotion to accelerate sales. Marketers also cite ‘economic cost‘ for the shift. 1 Answer to Describe the factors that have accounted for sales promotion’s rapid growth. However, industrial marketing may not use advertising so much as consumer marketing, but sales promotion efforts are present in industrial marketing also. Definition of sales promotion SALES PROMOTION: Consists of a diverse collection of incentive tools, mostly short term, designed to stimulate quicker or greater purchase of particular products or services by consumers or the trade. growth. In case of new products, the producer may offer some buying allowance to the dealers. Excess Stocks. Joint promotion which link the buying of one service to another. Sales promotion is able to deliver these results. Factor 4: Leverage Intelligent Sales & Marketing Data for Revenue Growth. 2) Gifting. Australian online shopping expenditure is predicted to be worth $26.9 billion by 2016, with a Compound Annual Growth Rate (CAGR) of 14.1%. Immediate Profits; 2. In such cases, the manufacturer may reimburse the advertising expenditure borne by the dealer. The Food and Grocery industry is a large and rapidly growing industry. Several factors have contributed to the rapid growth of sales promotion. The rapid growth of sales promotions in consumer markets is most likely the result of all of the following factors EXCEPT _____. In some cases, the manufacturer and the dealer may undertake cooperative advertising campaign. Factors contributing to the growth of small manufacturing firms: perceptions on Japanese owner/managers. a. Most companies have pressure for short-term profits, a drive that sales promotion satisfies. Marketers are making greater use of sales promotion in their marketing programmes because consumers respond favourably to the incentives it provides. Market Share; 8. b. more competition and a decline in differentiation of brands. If your product is satisfying the needs of the consumers at reasonable prices, it will sell. (a) Pressurizing by manager to increase sales (b) More external competition (c) Least difference among the brands (d) All of these 9. Creating a dynamic and fruitful sales department is not a difficult task. With the overwhelming amount of data present in sales, you must be careful to only provide sales reps with intelligent data. Sometimes, it prepares the ground for the salesmen to meet the prospects by sending them circular letters and sales literature. The problem with advertising is that consumers are bombarded with advertising messages every day. Small Businesses are often regarded as high risk operations locally and globally due to the presence of factors that are difficult to predict adequately (Thomas, 2000: 287). Enter your email below to get access to Our All helpful Tips and Articles, 18 Key Success Factors in Retail Business (With Examples), 11 Main Types of Sales Compensation Plans (With Examples), 13 Factors Affecting Structure of Sales Organization (Explained), 22 Importance of Salesmanship to Producers (With Examples). The United States, for example, came forward with the “Innovate Amer ica” strategy in 2005. 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