Greg Raymond is a training and development strategist at RedRover Sales & Marketing Strategy
It’s a common practice in business to set up a booth at the same trade show every year out of habit as part of your sales promotion strategy. Businesses show up, set up the same table display, and use the same fishbowl to collect many of the same business cards as they did in prior years.
But what happens after the show? Sales teams often characterize a successful trade show based on the number of interactions with existing and prospective customers. But, without collecting and evaluating data on the sales that resulted from those conversations, it’s impossible to recognize failure.
Effective sales promotions aren’t about winning popularity contests or even boosting sales. Successful promotions are defined by ROI. And without proper planning and evaluation, sales promotions become failures we don’t recognize and are doomed to repeat.
Consider these three strategies to win with your next sales promotion.
Set measureable goals. ‘Increasing sales’ doesn’t cut it as a successful promotion goal. Are you hoping to bring in new customers or improve retention rates? When you consider the expense of your promotion, how much business do you need to bring in to profit? A cable service provider knows if they lock a customer in for two years, it’s less likely that the customer will switch to another provider, even when the promotion period ends and the rate goes up. In this instance, the loss in margin during the promotional period is offset as long as a target percentage of customers is retained.
Leverage research to innovate. When brainstorming new promotion strategies for your next campaign or event, consider starting with research to help you understand your target audience. Send a short, simple survey to collect demographic data and feedback from your customers. Offer an incentive to encourage responses. With a clear picture of who your customer is, how they perceive the value of your product or service, and what factors drive them to buy, you can create innovative sales promotions that better encourage your target market to take action -- because they're tailor-made.
Create FOMO. When products are available in limited quantities, people assign greater value to them. The best sales promotions take advantage of our “fear of missing out” by offering deals for a limited time or in limited quantities. When customers have a reason to act quickly, they are more likely to commit. Words like “instant” and “fast” also flip a switch in our brain that makes us want to buy. Groupon has found success by offering discounts in limited quantities for a limited time.
When constructing your next sales promotion, just remember to set measurable goals, leverage research to innovate a tailor-made offer, and create FOMO.
Greg Raymond can be reached at www.redrovercompany.com.