Sales promotion is an advertising channel that is directed at boosting short term sales through coupons, discounts, contests, rebates, free samples, incentives, cross-product promotions, and point-of-purchase displays. These promotions involve every level of the sales channel – distributors, retailers, sales people, and consumers.



In most cases, sales promotions are better at reaching consumers with direct contact than traditional advertising channels are. Sales promotions also can have a more meaningful impact on customers. For example, free samples and point-of-purchase displays will often be accompanied by a store manager or employee who can explain the product and provide further information. You can't sample a TV commercial or get more information without going to the store or getting on the internet.

... for Four Reasons

Advertising Fragmentation – When you advertise your products, you can run into a problem known as advertising fragmentation. This is when your advertising encompasses too many channels and forms an inconsistent or distorted message. Your target market may be small, but you're using channels that are too large to reach them.

Sales promotion has the advantage here because you can really control the message you send. Most of your promotions will be in store (samples/cross-promotions/point-of-purchase) or the content is created by you (coupons/discounts/contests/rebates). Advertising images and slogan change for many companies when they change ad agencies. However, there is no fear of sending an inconsistent message here because sales promotions are short term.

Accountability – Measuring the number and value of the impressions you get from an advertising campaign can be very hard. You almost always have to ballpark it. However, because many sales promotions are done face-to-face with the consumer either in store or in contact with your promotions, it is easy to measure. You can measure coupon return rates, rebate rates, point-of-purchase sales, and contest entrants. Now you can go back and re-evaluate not only your sales promotion programs, but your entire marketing campaign.

Product Proliferation – It can be difficult to cross-promote products through regular advertising. You can ensure that your name is visible and your brand is recognized, but how many people actually listen to the “meat” of the commercial that's talking about the free $20 Mobile gas card that comes with the purchase?

With sales promotion, it's very easy to cross-promote inside and outside of your company. When a customer purchases something, you can physically hand them a coupon good for another product. You can relocate items on shelving to help the cross-promotion efforts. Sales promotion, specifically cross-promotion, works best when you have a very large product line. With this, you can go to other businesses and present cross-promotional ideas on each of your products. The more products you have, the more cross-promotions can be created.

Short-Term Results – An advertising campaign rarely draws in short-term sales. There has to be some immediate call to action for that work. However, sales promotions are notorious for producing quick revenue. Managers will usually implement some sales promotions programs if they see they are coming up short for their quarterly close. Running discounts on out-of-date products or coming up with point-of-purchase displays that sell the latest products really work to boost revenue for a short period of time.

Advertising cannot do this. Not only is there a lengthy process is planning out an advertising campaign, determining message consistency, and coming up with ways to measure impact, but ad campaigns must run for a while before they even make an impact.

But You Still Need Advertising

You may say that a marketing campaign cannot survive with simple sales promotion programs. I agree with you. Advertising gets people in your door while. Once they're there, sales promotions sell them more and strengthen your brand image.

Advertising is broad, long term, and is hit-or-miss. Sales promotions are focused, short-term, and dependable. Weigh the pros and cons and figure out what your campaign needs. But be aware that sales promotions are very reliable to implement on local or regional scales. They may take more work, but it is definitely worth it.