June 28, 2012

Roles And Importance Of Sales Promotion

The importance of promotion in marketing is gradually increasing. Marketing specialists have mentioned that use of sales promotion has dramatically increased in past decade. The producers have spent much more amount on sales promotion than on advertisement. Sales promotion is equally important to producers, middlemen and consumers. 


The role and importance of sales promotion can be discussed as follows:

1. Importance of sales promotion to producers

Sales promotion is very important as well as effective method for manufacturers to supply products to target market. It attracts prospective customers to new products along with the increase in demand for old products. Increase in volume of production and sales decreases per unit cost. As a result, profit increases. Sales promotion also increases effectiveness of personal selling , advertisement and goodwill of the firm.

2. Importance of sales promotion to intermediaries

Intermediaries/middlemen also get benefits from sales promotion. It becomes easy for wholesalers, retailers,agents and dealers to sell goods, because it is not needed to inform consumers about the features, utility, price, using information, etc of the products. This saves labor and time. As the businessmen get trade discount, gift, bonus, etc from producers. It results sales volume resulting in more profit. Demand and supply of products continues by which capital invested in stock of goods can be effectively mobilized.

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3. Importance of sales promotion to consumers

The consumers also get adequate benefits fro sales promotion. They can get direct benefits from the programs such as free distribution of samples, reduction in price, coupon, participation in competition etc. Besides this, the consumers get various indirect benefits from sales promotion. It increases their loyalty to the product and firm, knowledge about the products, improvement in their living standards etc. Facilities to select products, availability of goods at cheaper price, possibility of self-services etc. increase good understanding and confidence between businessmen and consumers.

In this way, producers, intermediaries and, consumers get benefits from sales promotion.