Concerns about the Increased Role of Sales Promotion

[sunandaC]

It is very important to note that the increased use of sales promotion is coming at the expense of media advertising. This has led to concern that the increased use of sales promotion is having a negative effect on brand equity.

Brand equity refers to a type of intangible asset of added value or “goodwill” those results from the favorable image or differentiation that a brand has achieved. Another term used synonymously with brand equity is consumer franchise. There are many examples of situations where a company’s have hurt the brand equity of their products by placing more emphasis on consumer and trade promotions than advertising. The book discusses how Heinz allocated most of its marketing budget to trade promotion during the early to mid ‘90s, which hurt the brand equity of many of its brands.

Sales Promotion
Two types of Sales Promotion:
1. Consumer oriented sales promotion:
It includes sampling, couponing, premium, contest & sweepstakes, refund, rebate, bonus packs, price-offs, frequency programs & event marketing.
2. Trade-oriented sales promotion:
It include dealer contests& incentives, trade allowances, pop displays, sales training programs design to motivate distributors & retailers to carry a product & make an extra effort to push it to their customer.

 

[jitendra05]

It is very important to note that the increased use of sales promotion is coming at the expense of media advertising. This has led to concern that the increased use of sales promotion is having a negative effect on brand equity.

Brand equity refers to a type of intangible asset of added value or “goodwill” those results from the favorable image or differentiation that a brand has achieved. Another term used synonymously with brand equity is consumer franchise. There are many examples of situations where a company’s have hurt the brand equity of their products by placing more emphasis on consumer and trade promotions than advertising. The book discusses how Heinz allocated most of its marketing budget to trade promotion during the early to mid ‘90s, which hurt the brand equity of many of its brands.

Sales Promotion
Two types of Sales Promotion:
1. Consumer oriented sales promotion:
It includes sampling, couponing, premium, contest & sweepstakes, refund, rebate, bonus packs, price-offs, frequency programs & event marketing.
2. Trade-oriented sales promotion:
It include dealer contests& incentives, trade allowances, pop displays, sales training programs design to motivate distributors & retailers to carry a product & make an extra effort to push it to their customer.

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