Business Studies Ch-16 Sales Promotion and Personal Selling: Meaning, Objectives and Importance (For CBSE, ICSE, IAS, NET, NRA 2022)

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Sales Promotion

Sales Promotion and personal Selling is an approach of increasing sale of a product and it is quite different from advertising. Suppose you go to the market to buy cake of soap. The shopkeeper suggests that if you buy two soap cakes, an extra soap cake will be given to you free of cost under “buy 2 get 3” scheme. You feel attracted to buy as by doing so you are saving money on soap. Moreover, soap is an item which is required on a regular basis, and so you can keep the extra two cakes to be used later.

Meaning of Sales Promotion

  • Every businessman wants to increase the sale of goods that he deals in. He can adopt several ways for that purpose. There are also exchange offers, like in exchange of existing model of television you can get a new model at a reduced price. All these are incentives offered by manufacturers or dealers to increase the sale of their goods. These incentives may be in the form of free samples, gifts, discount coupons, demonstrations, shows, contests etc. All these measures normally motivate the customers to buy more and thus, it increases sales of the product. This approach of selling goods is known as “Sales Promotion” .
  • Advertising also help in increasing sales of goods. Thus, advertising can be used as means of communication to inform potential customers about the incentives offered for sales promotion. Sales promotion adopts short term, non-recurring methods to boost up sales in different ways. These offers are not available to the customers throughout the year. During festivals, end of the seasons, year ending and some other occasions these schemes are generally found in the market.
  • Thus, sales promotion consists of all activities other than advertising and personal selling that help to increase sales of a particular product.


Explain the meaning of sales promotion.


Importance of Sales Promotion

The business world today is a world of competition. A business cannot survive if its products do not sell in the market. Thus, all marketing activities are undertaken to increase sales. Producers may spend a lot on advertising and personal selling. Still the product may not sell. So, incentives need to be offered to attract customers to buy the product. Thus, sales promotion is important to increase the sale of any product.

From the Point of View of Manufacturers

Sales promotion is important for manufacturers because of the following reasons:

  • It helps to increase sales in a competitive market and thus, increases profits,
  • It helps to introduce new products in the market by drawing the attention of potential customers,
  • When a new product is introduced or there is a change of fashion or taste of consumers, existing stocks can be quickly disposed off,
  • It stabilizes sales volume by keeping its customers with them. In the age of competition, it is quite possible that a customer may change his/her mind and try other brands. Various incentives under sales promotion schemes help to retain the customers.

From the Point of View of Consumers

Sales promotion is important for consumers because of the following reasons:

  • The consumer gets the product at a cheaper rate,
  • It gives financial benefit to the customers by way of providing prizes and sending them to visit different places,
  • The consumer gets all information about the quality, features and uses of different products,
  • Certain schemes like money back offer creates confidence in the mind of consumers about the quality of goods,
  • It helps to raise the standard of living of people. By exchanging their old items consumers can use latest items available in the market. Use of such goods improves their image in society.

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