ABSTRACT
Introduction 282 Factors driving increased sales promotional activity 282 Strategic and tactical considerations 285 Advantages and disadvantages of sales promotions 286 Manufacturer and retailer perspectives 287 Competitor response 287 Ethical issues in sales promotional activity 288 Summary 288 Review questions 290 Recommended reading 290 Case study 12.1: Thomas Cook 290 Notes 295
After studying this chapter, you will be able to:
• Define the main types of sales promotions and discuss their role within the marketing mix
• Discuss the strategic and tactical roles sales promotions may play
• Critically evaluate the advantages and disadvantages of sales promotion activity both in the short and long term and from a manufacturer and retailer perspective
• Discuss the impact of competitor reaction to sales promotional activity
• Discuss the issues relating to contentious sales activity such as that directed at children
Introduction
Sales promotions are incentives used to stimulate sales of a specific product or service
by changing prices or adding perceived value in the short term. For example, price-based
sales promotion may involve a 25 per cent reduction in the normal selling price, or offers
of ‘buy one, get a second one for half price’. An added value sales promotion may involve
buying a product at the normal price but receiving accessories or complementary products
free. For example, getting a specified number of photographs printed may entitle the
purchaser to a free photo album. A food manufacturer may offer free recipe books in
return for evidence of a specified number of product purchases.
