Student Corner - 248
SALES PROMOTION TOOLS
Another popular tool in sales promotion is
coupon. Samples introduce new products or service or some innovative addition
to the existing product like variation in flavor, in colour and even in packaging
design. But Coupons as tools of sales promotion promise definite cash benefit
to the customer in the way of guaranteed discount. Monetary advantage is a real
force of attraction to the customers. Coupons thus tell the customers ‘your pay
less with this coupon if taken to the
retailer for the same product or even for the new product.’ For the new product, coupons announce less
risk to try the product unlike the way of samples where you are introduced to
the product for trying it but with no monetary advantage. Discount before the
purchase is gained by the customer, not after the purchase as is cash refund or
cost reduction discount after the purchase.
Coupons also come with less risk in trying new
products; trying a new product can result in positive or negative response from
the customer; if it is positive, it is ok but if it is negative, you have
already spent on the new product at the price announced; in other words, you
have unnecessarily spent you feel in the trial of the new product; but with
coupons with already declared discount, you spend less at the beginning itself.
If your attempt to try the new product is positive, you have enjoyed the
advantage of knowing the new product at a lesser cost; but if the result is
negative, you feel you have spent some money without need on a new product and
coupons have rescued you from buying the new product.
Marketing personnel, however, see some
disadvantage in coupon as tool of sales promotion. Too many coupons, that is,
coupon clutter leads to less redemption rate. Massive distribution of coupons
in a way discourages the customers who tend to distrust commercial wisdom of
the distribution of coupons. Moreover, customers see coupons as not price
reduction but a temporary offer.
Manufacturers resort to coupons sometimes due
to competitive market. In fact, market itself means competition and when the
business apprehends some inordinate decline in sale, it has and it does wake up
to meaningful response to the decline in sale. First and foremost, you have to
retain the customers from moving off to the competitor. Here coupons come handy
to communicate to the customer through coupons tending to persuade not to leave
you. Businessmen know this kind of challenge too well to miss it.They act to upgrade
their sales promotion because they know well that sales promotion is a sure way
of sustainability.
Again, we will see
some more tools of promotion in our next.
