Sales promotion is a set of marketing technologies aimed to stimulate the demand in particular products and increase brand awareness. Limited in time, it creates a feeling of time-sensitiveness, generates new leads, and keeps existing customers engaged.
Sales promotion is one of the core elements of the promotion mix. To build long-lasting relationships with users, you need to find out the types of sales that work with your target audience. At the same time, you should provide customers with value that’s relative to your field of expertise.
Benefits of Sales Promotion
- It helps to generate new leads
- Allows re-engaging with your existing audience
- Skyrockets revenue
- Increases brand awareness
- It helps to generate new leads. Sales promotion can boost your product image since it encourages sharing information about it within social groups related to your business. If you sell training football shoes, people keen on playing football will share the message.
- Allows re-engaging with your existing audience. Once a person subscribed to a brand’s email newsletters, they will receive regular sales promotions. It is a way to keep the audience engaged and maintain a close connection with the company, which is crucial for building loyalty.
- Skyrockets revenue. Sales promotions help companies to increase the number of sold goods, even though they need to lower the price to achieve that goal. Of course, merely reducing the price is not enough, people should need your product, while the discount is only another reason to make a purchase.
- Increases brand awareness. Sales promotion is a way to make a name for your brand because people are more likely to talk about a сompany that proposes benefits and saves their money. That’s what sales promotion does.
Sales Promotion Objectives
- Launch a new product
- Attract new clients
- Stay competitive
- Make existing customers buy more
- Sell during off-season
- Run clearance campaigns
Although the main goal of sales promotion is to increase demand in a particular product, you can reach several important goals. Understanding them will help you create an effective promotion strategy.
- Launch a new product. If you're going to expand and turn your small coffee shop into a bakery, you need to reach new market segments. You can attract new customers by offering a free cookie with each cup of coffee or suggest visitors set their own price once in a while.
- Attract new clients. This objective should be your long-term goal since it allows your business to grow. Your potential clients are likely your competitors' customers, so analyzing their product and benefits, you can offer something more valuable.
- Stay competitive. Researching and analyzing your competitors will not only help you attract new clients but constantly improve your product and customer service.
- Make existing customers buy more. It's always easier to make an existing customer buy more than attract new clients. Provide each client with a personalized approach — it will help you build customer loyalty. As a result, clients will promote your brand organically.
- Sell during the off-season. Goods like swimwear, boats, tents, air conditioners, refrigerators are definitely more popular in summer but you should consider special strategies to sell them throughout the year. Offer time-limited discounts, "1+1=3" campaigns, and other marketing tricks.
- Run clearance campaigns. They're especially popular before summer and winter. As dealers need to make room for a new collection, they often run total clearance campaigns when users can buy goods from old collections at extremely reduced prices.
There are several types of sales promotions that will help you reach your objectives.
Types of Sales Promotion
- Price deal
- Loyalty reward program
- Bonus-pack deal
- Mobile couponing
There is a variety of ways to run a successful sales promotion, but let’s focus on some most frequently used ones, using a cup of coffee as an example.
- Price deal. It is a temporary cost reduction, for instance, 20% off for a coffee for a week.
- Loyalty reward program. This means that customers collect points or credits when they buy coffee. If they get 10 points, for example, they will have one coffee for free.
- Bonus-pack deal. It means that a customer can get more products paying the original price. For instance, they pay a dollar for one cup of coffee and get free candy, which gives some positive emotions and makes them come back in the future.
- Giveaways. These tactics aim to increase brand awareness. It means giving some items for free in exchange for personal information to use in further marketing. For example, offer a free cup of coffee in exchange for a phone number, which you can use for many purposes: promoting new sales, sharing updates and news with short text messages, etc.
- Coupons. You can sell coffee for the original price and give a coupon, which will make the next purchase 5% cheaper.
- Mobile couponing. It stands for coupons received on mobile phones via SMS. To get a discount, a customer needs to show the coupon on their smartphone.
- Sampling. Choosing this promotion type, companies give a sample of the product; for instance, the first cup of coffee to promote a new taste.
Sales Promotion Techniques
- Time-limited offers
- Seasonal promotions
- Holiday promotions
- Reward points
- Special prices
- First-purchase coupons
- Free shipping
In this section, you'll see some popular techniques as well as less used methods that will help you increase sales without much effort.
- Discounts. This technique is as old as the hills. Small companies and big corporations use this method to sell more. One of the reasons it's so popular, even today, is that discounts are great for both consumers and retailers. Sellers can clear room in their warehouse for new arrivals and customers can buy more at reduced prices. Keep in mind that a normal discount should be between 5-20% since clients won't even notice less than 5% discount, but more than 20% off will make them feel suspicious about your brand.
- Time-limited offers. This technique works even better than a big discount. With this trick, marketers manage to create a sense of urgency and fear of missing out on their products. You can give clients 24 hours to grab this special offer. To make this technique perform better, you need to advertise your promotion on each channel you use. This will bring more sales and increase your site traffic.
- Seasonal promotions. People often buy ski suits in summer and air conditioners in winter to save money. Selling products during off-seasons can be a real challenge, so we strongly recommend you to run seasonal promotions. Sell items from old collections at reduced prices and don't forget to advertise your campaign via email and social media.
- “1+1=3". "Buy one and get one for free" and "Buy 2 items and get the third one for free" are very familiar marketing tricks. Such campaigns help you sell products at a low price or save money shopping together with a friend. Retailers can significantly boost sales with this technique reinforcing clearance sales.
- Holiday promotions. Christmas, New Year's Eve, Halloween, International Women's Day, and Valentine's Day are great chances to skyrocket sales. People are extremely generous when buying presents for their friends and family. Launch your holiday campaigns in advance, and invest in advertising via email, PPC, social media, and other channels. This will help you increase brand awareness and site traffic.
- Gifts. Who doesn't like freebies? If you are a startup or about to launch a new product, go for this technique. It will help you reach big audiences fast, build brand recognition, and collect user-generated content which is especially valuable for every type of business. Let users try your service for free for 7 days, launch a campaign that will let each client who spends $100+ receive a gift, or give away free samples with each order.
- Contests. Competitions are a great opportunity to boost user engagement and increase brand awareness and sales. You can let your audience to create a slogan for your brand, a new advertising message, design, or share creative ideas on how to use your product in an unusual way. Make sure that the prize correlates with the effort spent on participating in your contest.
- Reward points. You definitely should reward clients who buy from you regularly - people love brands that appreciate their choice. So, with this technique, you can start building customer loyalty. Give points to each client who makes a second purchase or spends a certain amount of money. Then, let them exchange those points for a product they like.
- Special prices. Marketers usually run a 1-day campaign when users can buy everything at a fixed price. These prices usually look tempting for users and they can’t overcome the feeling of missing out. The goal may be an annual clearance of goods. You can set a fixed price for each product category of your store. For example, sweaters for $5.99, jeans for $9.99, coats for $15.99. This technique works.
- First-purchase coupons. It always takes time for people to give money to a new store especially when buying expensive products. To make them think over the purchase faster, offer a special incentive. You can send a welcome email to a new visitor with a coupon to get a 10 or 15% discount off their first purchase. For better performance, limit this appealing offer to a couple of days.
- Free shipping. Very often users leave your site without buying just because of expensive delivery options. To win back these potential clients, you can run a time-limited campaign that allows them to receive their orders for free if they spend a certain amount of money. If you sell medium-priced goods, do not make this fixed sum too high. Otherwise, people won’t fall for this trick.
Now that you know a bunch of effective sales promotion techniques, choose the most profitable methods for your business, and try SendPulse to run an effective campaign via email, SMS, or Facebook.
Sales Promotion Examples
- Email marketing
- Facebook marketing
- SMS marketing
It is one of the most efficient digital marketing channels, with the ROI up to 4000%. Marketers use sales promotion for lead nurturing, reactivation, promotion, etc. To succeed, marketers combine sales with educating materials. In this sales email, Grammarly offers users a chance to upgrade to a premium plan and shows the multiple benefits and suggests taking advantage of the 40% discount limited it time.
Email is also an effective platform for holding giveaways. You can create a giveaway campaign on specialized resources like Rafflecopter, and keep users engaged with giveaway emails along the way. The example below shows how the Apple Music Festival encourages people to participate, using the names of famous artists who are going to perform there.
Facebook is one of the most powerful advertising platforms due to its global coverage and detailed targeting options. Facebook marketing allows using various types of ads to fit any demand and budget. Here’s an example of a carousel ad with a 10% discount by iHerb.
This channel is excellent for instant updates and flash sales. It works out well for local businesses. The example below shows how sales promotion in SMS marketing can create a sense of urgency, stimulating people to visit a restaurant for lunch.
Sales Promotion Ideas
- Give an adequate range of discounts
- Target sales promotion to the right people
- Take advantage of the shopping holidays
- Create a sense of urgency
- Develop a loyalty program
- Use sales promotion to generate leads
- Offer free shipping
- Give an adequate range of discounts. Avoid more than 50% discounts, because they make you look desperate. Don’t give discounts, like 2% either, as they won’t thrill your customers.
- Target sales promotion to the right people. Find out which people are likely to buy a particular product you want to promote. For instance, if you run a sports shop and you want to increase the demand for skateboards, target your promotions to teenagers and young people.
- Take advantage of the shopping holidays. Marketers have developed a system of consumerism based on traditions. As a result, people spend more money on shopping in particular days called shopping holidays. These are Black Friday, Cyber Monday, Christmas, New Year, Halloween, to name a few. Any holiday meaningful for a specific group, like Mother’s day for women, can be a reason for companies to promote sales.
- Create a sense of urgency. Create time-limited offers to make your audience feel they are going to miss something important. Time-sensitiveness is an excellent incentive for people to purchase since it appeals to their emotions.
- Develop a loyalty program. This technique will help you keep your customers engaged for an extended period. Offer to collect points from every dollar spent, so in the future, your customers could use them to pay for new purchases in your shop.
- Use sales promotion to generate leads. Use a discount as an incentive to subscribe to your email newsletters. Lead magnets help to cover this process during the subscription.
- Offer free shipping. It is the right motivation for people from distant regions to decide to buy from you.
Watch this video to find out how to increase sales quickly and promote your products at the right place at the right time.
- The article “10 Sales Promotion Examples and Ideas” from Medium gives actionable insight on how to run sales promotions online.
- The article “6 Sales Promotion Ideas to Leverage or Leave” by HubSpot contains recommendations on what to do and what to avoid when you perform sales promotion.
Last Updated: 19.03.2021