Class 12 Business Studies - Methods/Techniques of Sales Promotion
Following are the methods used by business houses are discussed below:
- Discount and discount coupons – It means offering products at less than list price. A certain percentage of the price is reduced as a discount. Example: Buy 2 shirts and get a discount of 30% on the second shirt; Clarks’ offer discount of 50%. A Discount coupon is a certificate that entitles its holder to a specified saving on the purchase of a specified product. Customers redeem coupons after purchasing the product.
- Product combination – Offering combination of two products, means on the purchase of one good, and another product offered as a gift. Example: 100g gm pouch of Kissan jam with 500 gm of Kissan tomato ketchup.
- Sample Distribution – free samples are distributed in order to launch or popularize their products. This is done to make customers try the product and learn about it. Example – sample of cosmetics, perfumes, surf, books, etc. As the distribution of samples is very costly, this system is confined to those products of small value which have often repeated sales.
- Rebate- In order to increase sale, many producers introduce price off offer to the customers. It means offering products at special prices, to clear off excess inventory. The product is offered at a price lower than the normal price.
- Quantity gift – It offering some extra quantity of the product as a gift to the customers. For example – 20% Extra or Buy 2, Get 1 Free.
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