A sales promotion can help drive immediate income. You can use sales promotions across the customer lifecycle - from attracting new customers to keeping existing customers loyal. Show
On this pageRole of sales promotionsSales promotions are frequently used as part of the promotional mix and influence the final stage of the purchase process in the customer journey. Focusing on the short term, sales promotions are designed to immediately:
Sales promotions are usually limited-time offers backed by a marketing campaign. They work best as part of an integrated program across your marketing channels. Depending on your business model, marketing objectives and target segments, sales promotions can be directed at either:
Motivate your staffConsider offering incentives for your sales staff to promote these special offers. Benefits of sales promotionsIn addition to increasing immediate sales, sales promotions can also help your business:
Before you start...
Types of sales promotionsSales promotions typically emphasise a lower price or higher perceived value. It's important to consider your overall pricing strategy when you plan a sales promotion. Effective sales promotions focus on the following customer behavioural drivers:
To spur your thinking, consider the following 8 techniques. Short-term price discounts motivate potential customers to make an immediate purchase decision. Depending on what will be most appealing, you can show discounts in:
You can offer discounts in many ways, for example:
A well-known and popular sales promotion is buy one, get one (often referred to as BOGO). There are many examples of 'buy one' sales promotions, including:
This works best where there's value in buying similar items in bulk items. For example, items that can be shared, or that fit together (e.g. for a set of new car tyres, buy 3, get the 4th free is a perfect offer). Coupons and vouchers are a popular sales promotion because:
You can use them to:
Consider:
An effective way to generate interest is through competitions with the chance to win prizes. To enter, customers often have to do something you're trying to encourage, for example:
You can run many different types of competitions, for example:
Before running a competition, make sure you understand the:
You can increase sales by bundling products and services together at a discounted rate. This:
This works best when you have complementary products and services that naturally work together. For example, you could promote a coffee and muffin deal for $3 less that the total price for the individual items. By adding a free giveaway when someone buys a specific product or spends a minimum amount, you can increase the apparent value of the purchase at little extra cost. It's a relatively low risk and flexible option that can improve customer satisfaction. Some examples of add-ons are:
The cost of shipping may be a reason why customers don't proceed with an online order. You must take shipping costs into account when you make decisions about pricing and taking payments online. Running a short-term sales promotion with free shipping can increase the:
For example, you may run an online bookstore and offer free shipping in Australia on orders over $100 for the month of June. More and more, customers want to deal with businesses that are ethical and sustainable. By donating a portion of your sales or profits to a charity or cause:
This could be for a defined period (e.g. for the month of May). Choose a charity or cause that matters to your business and your customers. Risks of sales promotionsSales promotions must be well thought through. Set specific goals and be aware of the risks. Make sure you don't:
Calculate the ROI of your sales promotionUse our return-on-investment (ROI) calculator to help you decide if a sales promotion will deliver, or has delivered, enough return on your investment to be worthwhile. This calculator focuses on marketing activities aimed at increasing the short-term sales of a specific product or service. It's not suitable for analysing other marketing activities, such as brand building, raising awareness or lead generation. Don't rely solely on this calculator to make investment decisions. As there's a very wide variety of sales-promotion activities, the calculator may not offer all the data-entry options you need. Interpreting your results
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ROI calculator for promotional activitiesTop 10 tips for effective sales promotions
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