Sales incentives are ingenious and simple when you’re a professional with marketing experience!
In a market economy, all business entities, both domestic and foreign, pay considerable attention to marketing communications policy. The marketing communications system is known to include four main elements: advertising, public relations (PR), sales promotion and personal selling.
Of all the elements of the marketing communications system,advertising is the mostfavored. Enterprises use all kinds of advertising to attract consumers, this and outdoor advertising, and advertising in printed publications, and advertising on television, in the subway and transportation, and advertising on the Internet, etc. However, modern society is extremely oversaturated with advertising!
Every day each person is affected by about 500 advertising messages, of which he is able to perceive and remember only 5-6. Therefore, the effectiveness of advertising is significantly overestimated by many manufacturers!
Such an element of the marketing communications system as sales promotion (sales promotion), often transferred by most enterprises to the background, which is absolutely unjustified, as it is no less effective than all other elements.
Sales incentives are methods and ways of influencing consumers to induce them to buy goods. As a rule, sales promotion (sales incentives) is short-term and episodic in nature, the main difference from other elements is its focus on encouraging the purchase of goods, which gives a high probability of getting a response from the consumer.
There are two groups of methods of stimulating consumers – price and non-price. Price methods of stimulation, despite the use of various techniques, are associated with a reduction in the price of goods. Non-price methods have a variety of forms in their arsenal: natural (premium), active offer and service.
Price-based methods of sales promotion:
- Various types of discounts on goods (fixed discount, bonus discount, discounts to specific groups of consumers, discount on additionally purchased quantity of goods, combining in the sale of complementary goods, etc.);
- Coupon distribution;
- Price reductions with deferred discounting, i.e., the discount is assumed to be given after the purchase has been made.
Non-price methods include:
- Various types of bonuses (bonuses can be in the form of gifts, souvenirs, product samples, various point-of-sale promotions);
- “Active offer” (leaflet distribution, contests, mass entertainment events, lotteries, bingo, etc.);
- Service (discount cards, service centers, warranty service, product delivery or packaging services, etc.).
Application of sales promotion methods in practice has a tremendous success, the experience of the world’s largest companies allows us to make sure of it.
“Singing Ice Cream Salesmen”
For example,Cold Stone Creamery, a small chain of ice cream cafes, was virtually unknown in 1999, behind such established brands as Baskin-Robbins and Dairy Queen. The company produced high quality ice cream, but it wasn’t enough to compete, so CEO Doug Dews created an inspirational concept for both consumers and employees – the “singing ice cream vendors“: if satisfied customers dropped a tip into a special jug, the grateful young ice cream vendors would sing a song. Thus Deuce, gave his customers “the best ice cream experience ever”, which allowed him to open a thousand such cafes across America until 2004.
“Thirty-inch sandwiches for $5.”
Another equally striking example: Stuart Frankel is an entrepreneur who ran two Subway eateries in Miami. At a time when South Miami was going through an economic crisis, most of Frankel’s customers were facing financial complications, and he realized that he needed to discount meals or introduce new quality but more affordable dishes to the menu. That’s when he came up with the idea of selling thirty-inch sandwiches for $5. The idea was welcomed by consumers, the consumer got good food at an affordable price. Soon there were other dishes for 5 dollars, consumers were amazed by such discounts and care from Subway, this is what brought the company billions of dollars in profits in a time of austerity.
Apple Store
The Apple Store, the world’s largest computer corporation, is the ideal of customer service. Apple Store retail stores are thought out to the last detail. At the Apple Store, consumers can use the help of consultants, personal assistants, experts or personal shoppers (specialists who accompany customers) when choosing products.
The Apple Store is the world’s only retailer that allows customers to experience products. All products are connected to the Internet, so customers can browse the web, read books on their iPad, play games on their iPod Touch or listen to music on their iPod Nano. Plus, there are no long lines at the Apple Store, no cashiers or cash registers. Each specialist walks around the hall with a special credit card reader, which allows you to pay for the purchase in the shortest possible time, and the receipt itself is sent to the buyer’s e-mail.
In addition to all this, the Apple Store offers customers individualtraining in the store to help them work with any programs from the Apple Store. The company’s specialists also help customers with the transfer of information from old devices to new, newly purchased ones. Any problem that a customer may have is already predicted and solved in advance by the Apple Store. The Apple Store retail chain brings in more than $1 billion dollars per quarter.
“Toppers Pizza: toy soldiers or lollipops as a gift.”
Toppers Pizza surpasses many competitors in the industry by “taking into account the needs of its customers and giving them joy”. The Toppers delivery service, when it arrives at the customer’s door, gives them not only their order, but also toy soldiers or lollipops as a gift, because it is “joyful and memorable”.
“Hobbies badges.”
The Westin Hotel and Resorts chain decided to apply an innovative method of sales promotion aimed at more penetrating and deeper communication between guests and hotel employees. The ingenious idea is that the name badges of hotel employees under the person’s name contain the following phrase, for example: “My passion is soccer.” Such a simple phrase encourages hotel guests to talk, on one topic or another, leaving a pleasant impression of the hotel. As a result of one of the studies conducted, it was determined that such “hobby badges” contributed to the dialog between 15 thousand employees of the company with its guests and served as a reason for a friendly attitude to the company and its choice as a place of rest for many visitors in the future.
Thus, as practice shows, the methods of sales promotion and sales growth, used by most companies, justify the costs of their implementation, and besides, the costs can be absolutely minimal, as, for example, with the above described “badges of hobbies”.
It does not matter what exactly the producer offers to the consumer as an advantage over his competitors (perfect service, discounts, small gifts in the form of soldiers and lollipops, impressions in the form of “singing salesmen” or something else), the main thing for the consumer is the feeling of exclusivity – the realization that the company thinks about him, gives joy and pleasant impressions. By applying sales promotion methods, a manufacturer can get committed consumers of his brand, goods or the company as a whole.
Branding agency KOLORO will help you with the development brand promotion strategy on the market, as well as select unique, ingenious and simple methods of sales stimulation for your company! Get in touch.
