How to plan store promotions

To increase sales, attract new customers, and retain current customers, many retail stores implement various sales promotion techniques.

While most organisations would love to sell products at full price all of the time, sales promotions have proven effective at increasing the overall bottom line in many retail stores. Understanding how to effectively run and track your sales promotion campaigns are essential to improving the profits in your store.

In your role, you need to develop expertise at using promotional events to their best advantage. This expertise includes:

· Being able to demonstrate and instruct your sales team in good selling practice and merchandising

· Being able to coordinate all of the promotional activities to communicate effectively with your customer

· Effectively implementing promotions that have been developed by others

· Evaluating and giving feedback on the results of a promotion in store

Before commencing the planning for the promotion, it is essential to define the objectives of the promotion, basically what is the business trying to achieve. This will help you in the selection and placement of product, and the strategies used when you look at visual merchandising and setting up displays. Some questions you might ask could be;

· What is the promotion idea?

· How will the idea draw customers to your store?

· What is the employee commitment?

· Do you have enough employees over the period to execute the promotion AND ensure that you are providing an awesome customer experience?

· What is the promotion timeline?

· When will the promotion take place?

· How will you let existing AND new customers know about the promotion?

· What is the goal?

· What are you trying to accomplish? Is it an increase in sales, or are you looking to increase your customer loyalty list?

Types of promotions

Loss leader

An effective technique to increase sales is to offer certain products at a steep discount, which are called loss leaders. The importance of loss leaders is the ability to draw new customers into your store. Most customers not only buy products that are steeply discounted, but also other products that are selling for regular price. Loss leaders are effective for selling overstocked items, increasing the traffic into your store, and building brand awareness. Running loss-leader campaigns regularly will lead to customers regarding your store as a place that always has good deals.

Point of purchase

Another sales promotion technique is to offer point-of-purchase items. These items are placed on the counter near the cash register. Many retail stores place items, such as jewellery and makeup, near the register. Customers often buy point-of-purchase items on an impulse. Many retail owners believe that point-of-sale products increase revenue.

Loyalty Promotion

Repeat customers are essential to the success of a retail business. One method to encourage customers to return is through reward programs made available to loyal customers. A more recent phenomenon is offering coupons to customers who ‘Like’ the store’s Facebook page.

This not only leads to customers coming to your store to use the coupon but also allows you to send messages to your customers through Facebook to keep them informed on new items and sales. Another option is to send a coupon or sale notification to all of its past customers that are on the store’s email list. The incentives work well to build loyalty and repeat sales because customers have a previous history of shopping at the store are likely to shop there again.

Free sample or Gift with purchase

Offering free samples is a promotion method retail stores use to entice reluctant shoppers to make purchases. A free item offered in promotion should be a low-cost, high-value item. A sample of a new perfume may be an excellent product to give away for some retail stores. The gift with purchase may be a free scarf, if they spend $100, encouraging the customer to increase their average spend.

New product/technology or range

The promotion may be to highlight a new product, new technology, or the latest style of denim. This type of promotion is about creating a sense of urgency to the customer, encouraging them to ‘want’ and need’ and enticing them into your store to buy, using a variety of advertising and merchandise techniques.

It is important that you communicate the implementation plan to your team and ensure that they understand the importance of achieving the promotional objectives. By involving others, you can also encourage staff to take responsibility for maintaining the visual merchandising power of the store. You need to make sure that staff understand all the criteria if they are involved in monitoring displays.

You may use a team meeting, a morning catch-up before the store opens or one- on- one meetings with key staff who have more responsibilities during the implementation of the promotion. The most important aspect is that ALL staff, including the casual that only works three hours on a Sunday understands the promotion and the standards required for the displays, ticketing, and general visual merchandising.

To learn how to steer your success as a team leader, the ARA Retail Institute runs multiple workshops on leadership and team culture. Join the ARA Retail Institute in their latest workshop which looks into how a team’s attitude and behaviours influence the outcome of challenging customer moments.


About ARA Retail Institute

ARA Retail Institute is Australia’s leading retail training provider for both accredited and non-accredited learning programs. For more information, please visit:





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