DISTINCTION BETWEEN ADVERTISING AND SALES PROMOTION

Advertising aims at persuading customers whereas sales promotion aims at promoting sales. Advertising is done through indoor and outdoor advertising media whereas sales promotion is done through gifts, price reductions, special offers, point of sale, offers, sponsorship and trade fairs and exhibitions. Sales promotion might be carried out for a specific period whereas advertising needs to be carried out through out the life of the product.

METHODS OF SALES PROMOTION

Free samples

This is the best way of introducing a product. It is very expensive as samples are given to every household.

Price reduction

Customers often expect household articles to be offered at reduced prices. Some producers distribute coupons to customers. The customer can use these coupons for part payments.

Competition

Sometimes competitions are held. Customers have to purchase several packets of the producer’s goods to enter the competition.

Free gifts

Gifts such as glasses, caps or cups may be given to customers if they buy the producer’s goods.

Point of sales

In a trade fair or exhibitions, the producer of a product has a stall where the salesmen do a free product demonstration and at the spot, sale is done with offers and gifts.

Loss leaders:  In this method the retailers advertise that they are selling a well-known product at a low price. The other products will be charged at a higher price. The consumers visiting the shops buy all the goods. So the retailer can increase sales without losing any money.

Sponsorship

The manufacturer or a wholesaler or a large scale retailer come forward to sponsor a musical programme, or a film, or a drama, or a sport event on a public media like TV, Radio, National daily etc., by incurring all the expenditure to conduct the programmes. The manufacturer or a wholesaler or a large scale retailer advertise their product/service while a film, or a drama, or a sport event on a public media like TV, Radio, are either telecast or broadcast so that they can draw public attention.

Special offers

During festivals many traders announce special offers. These offers carry a special discount or a free service during a specific period of time. Customers tend to buy more when there are offers. Example, during New Year eve, manufacturers announce 20 – 30% special offers on certain range of consumer goods like home appliances, consumer durables and fabric items.