Everyone loves to see, hear, and be a part of SALE. Customers love sales promotion as they get products at lower prices, and retailers adore them for increasing revenue. Retailers can use the strategy of sales promotions to attract more customers. Sales promotion increases revenue from existing customers too.
Defining sales promotion and its benefits
Sales promotion is a strategy to give a boost to a retailer’s sales. This strategy leads to a rise in brand awareness or demand for a particular product or store.
It is a temporary strategy creating urgency around the sales of products. The fear of losing out the chance to buy that product at lower prices motivates customers to buy it. Sales promotion results in a higher conversion of leads to customers. It has long-term benefits like:
a) Generation of new leads: People share the news of sales promotions in their social groups resulting in new prospects.
b) The opportunity of engagement with existing customers: Retailers send notifications about sales promotions to customers through email newsletters or messages. These notifications enable them to engage and maintain customer relationships.
c) Rise in brand awareness: It results from word-of-mouth publicity by customers benefiting from those sales promotion strategies.
d) Increase in the volume of products sold: Retailers reduce prices during sales promotions, attracting customers. This technique leads to more volume sales.
e) Activation of dormant customers: The announcement of sales promotion strategies creates excitement among customers. Even the dormant customers become active and buy products.
f) Promotion of a new product: When introducing a new product, retailers need to market it to a large customer base. Retailers can use unique sales promotion tactics to expand their reach. This way ensures a good promotion of the new product.
g) Clearing the aging product stock: Retailers use sales promotions to finish off the near-expiry products. This way, you can avoid suffering losses resulting from returning expired products.
Impact of Covid-19 on sales promotions
These are the key benefits of sales promotion strategies that retailers use. Yet, these are not easy to execute in the current disturbed times of the Covid-19 pandemic. The retail industry is having many concerns such as:
All these concerns are affecting the retail industry at the same time. So, businesses need to prepare a sturdy, strategic, and unique sales promotion plan. But retailers must factor in the post-pandemic challenges for the economy as well. These challenges include:
But these challenges must not shift your sales promotion plans to the backburner. Check out the Global News video on How the COVID-19 pandemic could change the retail industry. It talks about the various changes that the retail industry is going through. These are because of the new normal resulting from the Covid-19 pandemic.
Planning for sales promotion strategies
A Sales promotion often means attracting customers to your products/services to make them buy. It is not that simple. It requires an optimized combination of science and art. A sales promotion is
Here, we will provide you a list of unique sales promotion ideas that you can use in your retail stores. It will help you to understand several ways to design sales promotion techniques. You can identify the few that work best for your retail store as per your business requirements.
Sales promotion strategies
Let’s go through 15 sales promotion strategies in detail. Any retailer can apply them to attract customers to their stores and drive revenue.
1. Flash sales
It is a type of sales promotion technique. The retailer offers products at discounts, but the duration is short. Flash sales create urgency in the minds of potential customers. If they miss this chance of purchasing the product at lower prices, they will not get such a deal later. It creates hype around the offer, and hence, retailers see a sudden boost in sales.
You can keep such flash sales promotions once or twice a year but set a fixed schedule. Due to the fixed schedule, the existing customers get excited about such flash sales. They wait for it and prepare the list of products to buy beforehand. They become happy because of the possibility of huge savings.
These customers also bring new customers along with them via word-of-mouth publicity. It ensures a good volume of sales for your retail store and a rise in brand awareness. You can also attract new customers with such flash sales advertisements.
2. Coupons or gift cards
Coupons or gift cards are beneficial sales promotions tactics for the retailer. You can offer a discount coupon if the shopping cart amount is above a predetermined limit. The same theory works in the case of gift cards. They provide another chance for you to generate sales. Another benefit for you is that some gift card amounts are never used, resulting in money savings for you.
It is also a beneficial strategy for customers. The customer saves money when buying the product. It is a way to encourage shoppers to become loyal customers.
3. Buy one, get another free
The word ‘free’ creates excitement in customers’ minds. Getting more for less is what entices them. They love the idea of getting something free along with buying another product. It is a unique sales promotion tactic with higher chances of positive results.
Retailers use this tactic to clear the stock of unwanted inventory or near-expiry products. They may also use this strategy to introduce a new product to reach a broader audience base. Retailers have two options:
Whatever the case is, it leads to high sales, generating a good amount of cash for the retailer.
4. Free samples
Another unique sales promotion example is offering free samples to the current shoppers. This strategy is for the existing customers who become loyal to your store. Retailers can use it to introduce a new product. Offering free samples allows improving the awareness of the new product among customers.
Among several benefits lies a key benefit of instant sales. The customer tries the free sample, likes it, and then buys it. Another benefit is the introduction of customers to the new product category. They may not have bought that product category in the past but may consider buying it soon. Customers love such sales promotions because they love to try a product before buying it.
5. Recurring sales promotion events
Unique sales promotion events can ensure a sizable number of sales for retailers. They can arrange either:
A Black Friday sale is an excellent example of a festival sale. Your existing customers are aware of such recurring sales offers from you. So, they prepare their shopping lists beforehand. As a retailer, it assures you of higher sales for your product/s. Through this strategy, you can clear your old inventory before introducing new stock.
6. Low-cost, low-risk sales promotion tactic
Retailers can also sell more less-priced products to generate a good volume of sales. It is a less risky, and hence, a beneficial sales promotion technique. In these cases, the retailer sells a low-risk product at a low price. The risk is so less for the customers, and the product is so cheap that they do not mind buying it.
Small business owners and retailers need not advertise for such sales. They can keep those products in their store with the offer, and most incoming customers will buy them. The retailer may not earn a profit or may even suffer a loss in such offers. But it is a way to sell a higher volume of goods and achieve good sales.
With such a unique sales promotion idea, retailers intend to cross-sell or up-sell. They earn added revenues from selling related or more expensive products. The intelligence lies in the placement and pricing of related products.
cashback, they shop more and contribute to more sales. The cashback strategy attracts new customers to your retail store as well.
Check out the Forbes blog, “Why the Psychology of Rewards Confirms Cash Back Is King.” It talks about the benefits of cashback as an effective sales promotion strategy.
8. Charity-related sales promotions
Charity-related sales promotion is a compelling and unique sales promotion idea for generating higher sales. It stimulates emotions in customers for other beings or causes that can benefit the world. Customers are more than ready to take part in such sales promotions. If the retail store supports the causes that customers align with, then you have hit gold.
It is a good strategy for retailers to increase their sales. It can establish the store as a socially responsible company as well. Customers will support your store and buy products often to support your brand and the cause. This sales promotion results in customer loyalty. This kind of activity humanizes your brand. It makes everyone participating in the sales promotion event satisfied and happy.
This strategy is a wholesome one, as it results in:
9. Referral benefits
brand. There are two different ways of designing this unique sales promotion strategy:
Either way, it is a beneficial technique to everyone involved. Your existing customers enjoy the discounts that you offer. You enjoy a new stream of customers. Moreover, with discounts on referrals, your existing customers’ loyalty towards you increases.
10. Joint sales promotions
There are two ways you can use joint sales promotions for your store:
The main benefit is that promotions of two products are happening at the cost of one. But you must be careful with the partners/products you select for creating the bundle. A slight non-alignment of the strategy between two partners may harm the strategy. Even a negative connection of the product may backfire for your store.
11. Professional or lifestyle discounts
revenues for you. It also helps you target a new customer group who might become your loyal customers in the future.
12. Clearance sales
Retailers use clearance sales – a brilliant sales promotions idea – to clear their stock. They use clearance sales to finish off the seasonal products. It will enable them to make way for the new product category in the display. Retailers create urgency around the sale by keeping it for a few days only.
It is beneficial for customers as well since they get good bargains. There is a limit on the number of products, and the same goes for the chance to grab them. But the opportunity to save money is vast, which attracts customers to these deals.
13. Loyalty programs
customer loyalty programs. Read about this on our blog, “5 Best Practices for Customer Loyalty Programs“.
14. Free shipping and free returns
Sometimes customers fill their shopping carts with multiple items but end up not buying most of them. Retailers witness many of such instances in the case of online shopping. The main reason? Extra shipping charges. Customers are not ready to pay extra money for shipping. So, you must offer free shipping to ensure that the customer completes the shopping.
Similar is the case with the return policy of retailers. Customers return the product when it does not meet their expectations. They feel they are not responsible for the product’s inferior quality. So, there should be no extra charges or difficulty in returning the products. They expect their full money back on returning the product. Thus, offering free product returns can be an effective sales promotion strategy.
15. Buy more, save more offers.
from the spending. Along with a higher volume of sales, it is a way to convert leads to customers. Retailers can provide these offers to their existing customers a day earlier. Thus, it is a way to give them extra benefits for being loyal and increase their loyalty.
The key to any marketing strategy is reaching the right customers at the right time with the right deal. Any retailer can achieve this by designing, executing, and managing sales promotion tactics mentioned in the blog. These are sure-shot ways to increase revenues. They also improve your brand awareness and attract new customers.
But a key consideration is how you customize them for your business and customers. You need to be different from your competitors in sales promotions to attract customers. Another factor is the advertisement of these tactics to reach your targeted audience.
Ari, a retail management system, is preferred by many retailers around the globe. Ari has many features and functionalities that benefit a retailer in day-to-day operations. There is a possibility of creating rewards programs and promotional strategies in Ari. You can also design sales promotion strategies and manage them through Ari. You can check in detail the promotions management functionality of Ari’s solution here.