Concept Of Demand Creation
It is very important to create demand for goods or services in selling process. Goods or services cannot be sold out only identifying potential customers and contacting them. They should also be motivated to buy.
Different promotional activities conducted to sell goods or services may be called creation of demand. In other words, all the special efforts directed to stimulate desire for goods with the ultimate objectives of sale at a profit may be called demand creation.
Every firm tries to increase sale volume of products at certain price through the use of promotional techniques. Specially, promotional activity is the practice related with information, message, motivation and persuasion. The practice of giving information about the product to customers, persuade and induce them to buy the product and set positive influence in them towards the product as well as firm is called promotional effort. Demand for products or services can be created through promotional activities.
Methods Of Creation Of Demand
There may be different methods of demand creation for goods. Among them the main methods are as follows:
1. Personal Selling
Personal selling is very important method of demand creation. To have personal talks or communication with prospective customers in order to persuade them to buy goods or services is called personal selling. In other words, personal selling is defined as an oral presentation in a conversation with one or more prospective purchasers for the purpose of making sales.
Personal selling is a method of direct communication. In this method seller or sales representative negotiates directly with customers, presents information to them, and motivates them to buy products. In this way demand is created.
2. Advertising
The other method of demand creation is advertising. The customers are given information and messages about new goods or services to arouse curiosity in them to buying the products. Advertisement is such a non-personal communication process through which demand for goods or services can be increased in market.
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3. Sales Promotion
Besides personal selling and advertising, there are other methods to create demand. They are called sales promotion efforts. Sales promotional activities such as display and decoration of products, trade-fair, exhibition, free distribution of sample, discount on additional purchase, gift programs, etc. are the other methods of demand creation. Such efforts motivate customers to buy products, which increases sales volume.
In this way, the above methods are used to create demand. Appropriate method of demand creation can be applied according to the objective of the firm, functional area, scope, nature of product, market competition etc.
