It typically cannot reverse a genuine declining sales trend. Marketers cannot reasonable expect sales promotion to convert refection of an inferior product into acceptance. Sales promotion may even weaken the brand image. Sales promotion has also been blamed for encouraging competitive retaliation. Short-term volume gain at the sacrifice of profits. Forward Buying: People buy more than they need at the deal price. Pay-for-Performance Trade Promotions: Retailers are rewarded for making sales to consumers rather than making purchases from manufacturers.
Ethical and Legal Issues in Sales Promotion Deceptive Sales Promotion Fraud: The Fake Storefront Stuffing the Ballot Box Playing the Middleman The Redemption Scam Diverting (or Arbitraging): Secretly purchasing a product where it is less expensive, usually as a result of a trade promotion, and reselling in areas where prices Final considerations Don’t promote if the product is not good Promotions rarely stop a declining sales curve It is very easy to lose the promotional gains made if your promotion has not been effective in retaining new customers. So the product has to speak for itself.
The objective of the promotion is to wean away users from competition and create new users. Excessive promotions lead to diminishing returns and may devalue the brand Promotions may be used in conjunction with advertising and other marketing communication tools It should be novel and attractive Ensure supply lines are good and adequate stock is available right through the promotion Cater for contingencies. Have escape routes built into the plan Trade has to be handled tactfully Reimburse incentives/ rewards/ gifts promptly Must be within the legal boundaries