Feature: Sales promotion: Towards a definition
It really shouldn’t be that hard to come up with an effective definition for sales promotion, that helps clarify what it is, but it would appear this isn’t quite as straightforward a topic as one might think.
As someone who started her marketing career in a sales promotion agency, I’m a great believer in the impact SP can have on a business or brand. Sales promotion has been proven time and again as a very effective way of generating sales as well as building brand loyalty. But what is sales promotion? Does any definition do it justice and how can we ensure it enjoys the credit it deserves and doesn’t get pushed to the bottom of every marketing or brand manager’s pile?
The ISP defines SP as follows. At its most precise, “it is any scheme designed to sell more product”. In its broadest sense, “it is everything in the marketing mix”. The ISP has a more specific definition stating that SP is “a communications initiative, the purpose of which is to create a call to action that has a direct impact on the behaviour of the brand’s target audience by offering a demonstrable, but not necessarily tangible, benefit”.
There’s no mention of sales, therefore the direct impact on behaviour could be lead generation and nothing at all to do with sales. And then there are all the other definitions from around the world – some similar and some just plain naïve.
“Activities, materials, and techniques used to supplement traditional advertising; includes trade advertising, and in-store media” is one definition, according to a glossary of business terms issued by a Canadian business organisation. “Sales promotion is a series of activities and materials used to create sales of goods and services”, states a dictionary of advertising terms from a design agency, again in Canada.
An academic book on retail management by Barry Berman and Joel R Evans claims SP “encompasses the paid marketing communication activities other than advertising, public relations, and personal selling that stimulate consumer purchases and dealer effectiveness”. A promotional merchandise company in west Chicago opts for SP as a “program designed to stimulate immediate action on the part of the consumer, generally by adding value to a purchase or action taken”. For an American business networking organization, it is “a company-sponsored program that is designed to motivate new sales activity and to offer one or several incentives for sales production”. Princeton University sees a promotion as simply something “that supplements or coordinates advertising”.
Taking all this into consideration, I would suggest the following: sales promotion is short term. Promotional activity has to be temporary in order not to become an intrinsic attribute of the brand. The objective is usually to increase sales in one guise or another. And promotions have to offer the customer something extra, whether it is value, eg. a free product, or goods, eg. a branded gift or prizes, or other intangible benefit, such as a link with a charity.
I guess my frustrations lie in the fact that many people still only perceive something to be a sales promotion if there is a free widget offered as an incentive to buy or it is a price promotion. Sales promotion is so much more than this and it is our responsibility as an industry to communicate this and build SP’s value.
This can be achieved in a number of ways:
- Make SP a fundamental part of the brand plan – not an add-on when sales don’t quite go to plan or a retailer demands some promotional activity. If it’s part of the plan from the start, the activity will be well thought through and will be more effective as a result.
- Integrate SP activity through the line – use all relevant channels and the impact will be that much greater.
- Make sure the SP activity aligns with brand values and strategy, thus building brand equity.
- Evaluate each and every activity robustly and communicate the successes or otherwise. Define key performance indicators (KPIs) in advance and ensure you have the measurement criteria and resource in place to evaluate.
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