Relationship of sales budgets and promotion programme

Analyzing the Influence of Sales Promotion on Customer Purchasing Behavior | OMICS International

relationship of sales budgets and promotion programme

The sales budget memorializes a businesses sales expectations for the coming which lists the expected units and revenue expected from the sales plan. Marketing contributes promotional information, which can affect both the timing and. Chapter 3 Planning, Sales Forecasting, and Budgeting SDM-Ch.3 1 Learning . plan • Marketing functional or including marketing-mix strategy, and sales relations & Publicity strategy Distribution strategy Direct marketing. Sales promotion has become a vital tool for marketing and its Firms have to rethink the relationship between attitude and behavior of their consumers. .. plan their promotional strategies, and allocate promotional budget.

According to Low and Mohr [ 13 ] manufacturers continue to spend a large amount from their communication budget on sales promotion. They allocate around 75 percent of their marketing communication budgets to sales promotion [ 14 ]. Similarly, we can see that companies spend a large portion of their budgets for sale promotion. The goal is to offer the merchandise more attractive and valuable.

relationship of sales budgets and promotion programme

Buy and test consumer products direct specific goals that can be achieved through efforts to boost sales in the short term, the implementation of consumers in stores, and get to the point of retail sale displays, and encouraging stores to store products and sales support for the efforts of staff [ 15 ].

This information allows us to conclude that the institutions seek to manipulate the buying activities of consumers, and so begin a strong promotional campaigns or changes in pricing policies, with other measures.

Event shows that a few consumer stand easily when they see the words of sales promotion. The main objective of this research is to study the effect of different tools to promote sales on the buying behavior of consumers.

Therefore, research on the promotional tools is actually important to understand most of the tools that affect the competition with its competitors, so they can use the most effective techniques to promote the right and attract customers.

The Cash Budget Part 1, Sales Budget and Collections Budget (Cost Accounting Tutorial #39)

Typical tools include of free samples, price reduction, Giving advertising gifts, and Offering coupon, Offer member card, Able to pay by installments, Extend warranty period, and so on. Sampling is the process by sending the actual product or trial-sized customers.

Is provided free samples of the merchandise to clients so that customers have the opportunity to try and use the products.

Price promotion refers to reduction in price for a limited time, which offered to customers. Proper gifts are one of the best ways to transfer the message that communication is important. Coupon has direct influence on increase of the sale through which consumers tendency toward the product increases [ 19 ].

It encompasses decisions regarding four major variables: Production and selling concept The production concept is based on the fact that customers prefer products that are available and affordable. This means that production managers focus on the superiority of products as well as constant product development.

The selling concept is based on the drive of the marketing, in other words that the customer will not buy enough of a single product unless it is constantly promoted [ 20 ]. Promotional mix As one of the marketing mix elements, promotion includes all the activities directed to the targeted consumers, that lead to facilitate the process of contacting with them for the purpose of formatting a sense of the importance of the commodity in achieving a high degree of consumers satisfaction of their wishes and needs comparing with the competitors commodities Mahmud I.

Promotion is one of the key factors in the marketing mix and has a key role in market success.

Budgeting Methods for Marketing Promotions | Absolute Marketing Group

Promotion is used to ensure that consumers are aware of the products that the organization is offering. The promotional mix is the combination of the different channels that can be used to communicate the promotional message to the consumers [ 22 ]. The channels to be used are; advertising, direct marketing, public relations and publicity, personal selling, sponsorship and sales promotion [ 23 ].

One of most important of channels is sales promotion. Sales promotion is a short term strategy to derive demand and also and especial marketing offer which provides more profit than what consumers receive from the sale position of a product and also has sharper influence on sales [ 25 ].

relationship of sales budgets and promotion programme

A sales promotion consists of techniques that are aimed at increasing sales in the short run, meaning that they are mostly used for a short period of time. It offers control, and the costs can be much lower than of advertising. The main characteristics of sales promotions are that they offer better value for money and they try to cause responses immediately [ 26 ]. This tool has the ability to attract and keep loyal customers and is an excellent what to persuade them build viable link with the organization and involves all motifs applied by the producer to persuade trade with members of a channel [ 27 ].

Sales promotion has a strong ability to add value and to bring forward future sales. For sales personnel promotional tools are used primarily for motivating staff or supporting them in their selling roles. Brassington and Pettitt [28] provide a revised definition for sales promotions: This extra value may be a short-term tactical nature or it may be part of a longer-term franchise-building program.

The environment refers to the external factors that influence the human being, these factors such as cultural and social forces in the society and in personal lives as well as physical and situational forces relates to the actual shopping experiences.

Budgeting Methods for Marketing Promotions

The behavior is a dynamic interaction and communication between consumers and the marketers doing exchanges [ 29 ]. There are four main factors influencing consumer behavior each of these factors can influence a consumer action in different ways, a combination of these factors affect the decision making process differently, these factors are cultural, social and religious, personal and psychological.

Culture is an important combination of character, behavior and a self-identification of human being, these characteristics help an individual to create his or her own buying behavior, and however, isolating culture as a variable that can be studied and readily implanted is very difficult, taking into consideration that the buying behaviors of human beings consist of three phases which are the individual, societal and situational.

relationship of sales budgets and promotion programme

Culture affects all these phases but the extent of the effect depends on the individual person and the circumstance [ 30 ]. Culture consists of beliefs, values and customs that serve to direct consumer behavior differently amongst the members of a particular group or society Values and beliefs are guides to behavior in such that they form and affect attitude on how to behave on certain situations, on the other hand customs are modes of behavior that constitute an acceptable way to behavior in a particular culture.

Social factors are very influential in the decision making process of the consumer, this can affect the decision making process in a positive or negative way. It may also consist of one person or few people such as spouses or someone you have never met but idealizes them, the influences of this reference or social group can be very strong in a way that a customer can change the behavior to meet the standards pushed by the reference group [ 31 ].

Gender roles have a significant effect on consumer behavior it defines what is appropriate for each gender in the form of behavior, attitude and appearance. And the female customers are interested in fashion, these different lifestyles help to determine consumer pattern of living which affects their purchasing behavior, if the company has an idea of the life style of its customers or a certain segments they can develop their marketing strategies to target these group of customers because consumer always chooses goods and services associated with their lifestyles.

Age also plays an important role in the decision making process of a consumer for example children come and buy candy, soft drinks while adults specifically women buy fashion products, cosmetics, households keepings and food stuff [ 31 ]. Religion is a symbol which acts to establish a powerful, pervasive and long-lasting modes and motivation. It is achieved by formulating conception of a general order of existence and further, by clothing this conception with such an aural of factuality that the mood and motivation seems uniquely realistic [ 32 ].

Religion affects attitude and behaviors both directly and indirectly through religious code of conducts and value formation from birth. As purchasing behavior is been influenced by cognitive actions, effect and behavior, the importance of this element must be taking into consideration in explaining the differences in religious belief system [ 33 ]. It is very important to communicate as clearly as possible in order to avoid selective distortion in which the consumer misunderstands the message if it is not in accord with their beliefs and attitudes.

These are important needs for sustaining the human life. Food, water, warm shelter, sleep, medicine and education are the basic physiological needs, which fall in the primary list of need satisfaction. Maslow was of the opinion that until these needs was satisfied to a degree to maintain life; no other motivating factors can work.

Briefly, the first level of needs is physiologic e. The second level encompasses safety needs. These include security, stability, protection; freedom from fear, anxiety, and chaos. The third level of need is belonging and love.

When they are unsatisfied, a person will feel keenly the absence of friends, mate, or children. As each of these needs substantially satisfied, the next need becomes dominant. So if you want to motivate someone, you need to understand what level of the hierarchy that person is on and focus on satisfying those needs or needs above that level [ 35 ].

Sometimes beliefs and attitude plays an important role in the decision-making process as they strongly affect the evaluation process of the alternatives. Beliefs are thoughts about the product or some of its qualities whereas attitude is overall favorable or unfavorable feeling against the purchase [ 2 ].

Attitudes are affected by three components: The buyer decision-making process. Buyer decision-making process Research shows that customers go through a five-stage decisionmaking process in any purchases made. The individual stages are summarized in the diagram below followed by brief explanations. This model is very paramount for everyone who makes marketing decisions. The model shows that customers go through five essential stages in every purchase. However, in more frequent purchases, customers sometimes skip some of the stages.

Select Objectives The next step is establishing the desired effect of your promotional communication. If promoting a new product, you'll seek product awareness. After you achieve awareness, your promotion program can focus on conveying your product's benefits to deciders and influencers to establish brand acceptance.

Customers must then become convinced they prefer your brand and that they want to own your product, which is brand insistence. Finally, the sales promotion should convince the buyer to take action, such as brand trial or purchase, and confirm the customers are satisfied with the purchase.

Capsim Simulation: The Marketing Module Promotion and Sales Budgets | Owlcation

Determine Promotion Mix After establishing promotion objectives, determine how to allocate company resources to achieve sales goals. For example, decide to use advertisements, publicity or personal selling to promote your product. A manufacturer of tablet computers might rely on incentives including coupons, contests and trade shows to promote sales.

In turn, the manufacturer might rely on advertisements to inform potential customers of the tablet's benefits, persuade individuals to buy the tablet and inform the public of purchase locations. Primary communication channels might include print and electronic media and press releases. Develop Message In developing the promotional message, you focus on the message content, its format and likely appeal.

The appeal, which is the reason the potential customer will purchase a product, affects the relative position of your product in the market. In turn, the message structure may or may not draw a conclusion for the customer regarding the desirability of your product. For example, an advertisement regarding a laptop might refer to its relative size or processing speed.

  • Analyzing the Influence of Sales Promotion on Customer Purchasing Behavior
  • Capsim Simulation: The Marketing Module Promotion and Sales Budgets
  • The Steps in Planning an Effective Sales Promotion Program

You must also consider the message format, the script, sound and camera angle for an electronic message or the headline, copy, color and illustrations for a print advertisement.

Develop Promotion Program Budget The budget is prepared after the promotion campaign planned.