Getting products out the door is half the battle when running a business. That’s especially true today as the sales process changes and evolves with the advancements of technology and online shopping. As a business, it is extremely important to entice and engage your customers. Everyone is on a budget, so customers need a reason to feel excited about the products and services you offer. A great way to evoke positive feelings toward your business and increase sales is through sales promotions.
Offering promotions to your customers is a relatively inexpensive way to increase cash flow. Since consumer sales are statistically lower throughout the winter months, traditional advertising expenses can create hardships for small businesses. Promotions are a budget-friendly opportunity to boost sales and spark new and returning customer interest. Sales promotions also give you a competitive advantage because customers will focus their attention on the business that offers them the most for their money.
Promotional Offers and Coupons
Many types of sales promos are available, and one of the most common is coupons. The paper coupon is still a popular way to reach a large number of customers but you should also consider online coupons. According to Marketing Sherpa, “Online coupons often have a redemption rate of more than 20 percent, as much as 10 times higher than traditional coupons.” If some coupons are only available through email or text messages, this also encourages customers to sign up for email or text subscriptions and increases brand and product awareness.
Sweepstakes and Contests
These two sales promotions are often used interchangeably but generate different customer participation results. Contests typically require the customer to put in some time and effort, such as writing an essay or recording a video. Sweepstakes usually just ask for simple participation and are therefore more popular than contests. The most effective vehicle for contests and sweepstakes today is social media. Sweepstakes on sites such as Facebook or Twitter often involve “sharing” or “re-tweeting,” which are efficient ways to reach thousands of people in a few simple clicks by the customers who participated.
Tip: Promoting a sweepstakes that will have multiple winners tends to draw more attention and participation than only one grand prize. Also, follow the sweepstakes rules for your state; this includes identifying your prizes, who can enter, the duration, how to enter and how the winner is chosen.
Loyalty or Rewards Programs
Create an incentive program for your current customers to keep them coming back. For example, airline frequent flyer promos ensure that once a customer chooses an airline, they are more likely to choose the same airline in the future in hopes of eventually flying somewhere for free. Loyalty and rewards programs are important because they can help create a base for building long-term relationships between the business and customer. Other forms of loyalty rewards include punch cards (buy four and get the fifth one free), in-store credit cards, and cash back programs (receive $10 off for every $70 spent).
Sampling and Freebies
Everyone loves free merchandise, so it is no surprise that sales increase when customers are offered free products or services. You can promote free items using coupon inserts, emails, QR codes, text messages and social media posts.
Samples can be mailed, included with another product, or given directly to a customer at a retail store. Ideally, the goal of samples is to lure people into your business so they will make additional purchases. One way to improve the effect of free products is to somehow affect the customers’ stimuli. For example, if you sell “soft” clothing, give away a pair of soft socks that the customer can feel. If you sell home décor, give away a small candle that the customer can smell when he or she walks into the store. If you sell audio devices, let the customer plug a smartphone into one of your speakers to hear how it sounds. Samples and free merchandise allow a customer to feel valued, which ultimately leads to better business in the future.
Sales promotions can be a fast way to improve sales during slow months. Providing rewards to your customers can also increase awareness of your business and may even generate a new customer or two.
As you can see, a wide variety of promos exists, so the challenge is offering a promotion that best fits the goals of your business while also matching the wants and needs of your target customers.