Page 618 - Business Principles and Management

Chapter 22 • Pricing and Promotion

meets the customer’s needs. If there are problems, they should be corrected imme-
diately. If following up with each customer is impractical, the business could peri-
odically conduct a customer satisfaction survey. This could be done with an in-store,
mailed, or e-mailed questionnaire or through phone calls to random customers.
The follow-up contact will remind satisfied customers where they made their
purchases, so they may choose to buy from the business again.

CHECKPOINT

Name the five areas that salespeople must master to be
successful.

Sales Promotions

Sales promotions are any promotional activities other than advertising and
personal selling intended to motivate customers to buy. Some sales promotions
are designed to encourage customers to buy immediately. Others are designed
to display the products in an attention-getting or attractive way to encourage
customers to examine the products.
Coupons are a type of sales promotion used extensively to promote consumer
products. Coupons are an effective method of increasing sales of a product for a
short time. They are used principally to introduce a new product or to maintain
and increase a company’s share of the market for established brands. Coupons
usually appear in newspaper and magazine advertisements, but they are also dis-
tributed by direct mail and are now even available on the Internet. A coupon
packaged with a product the customer just purchased may encourage the cus-
tomer to buy the same brand the next time. Or the enclosed coupon may be for
another product from the same company, to encourage the customer to try it. How do businesses use
Manufacturers often cooperate with wholesalers and retailers by providing coupons as a sales
promotional materials. Some of these materials, commonly furnished without promotion tool?
cost or at a low price, include window displays,
layouts and illustrations for newspaper ads,
direct-mail inserts, display materials, and sales
presentation aids.
When producers are introducing a new
product, they may distribute samples through
the mail. The purpose of this activity is to
familiarize people with the products to create a
demand for them in local businesses. Coupons
often accompany the samples to encourage
consumers to go to a local store and buy the
product.
Producers and distributors also cooperate
with retailers by arranging special displays and
demonstrations within stores. For example, demon-
strators may cook and distribute samples of a new PHOTO: © GETTY IMAGES/PHOTODISC.
brand of hot dog to customers in a grocery store.
This practice usually helps the retailers sell the
new product. The retailer, of course, gives this
merchandise preference over other competing

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