Merits

Merits of sales promotion are evident from the following facts:

1. Attention Value

Use of incentives helps in attracting a large number of buyers.

2. Useful in New Product Launch

The tools of sales promotion like discount, free gift offer etc. are very useful in launching new products. It convinces them to use new products in place of the products which they may have been using regularly.

3. Synergy in Total Promotional efforts

Sales promotion tools add to the overall effectiveness of the efforts made under personal selling and advertisement.

Limitations

The following are the limitations of sales promotion as follows:

1. Reflects crisis

If a firm uses sales promotion tools frequently, it may give the impression that the numbers of consumers are very less or a firm is unable to manage its sales.

2. Spoils Product Image

Continuous use of sale promotion tools also affects the product image. The customer may develop an impression that “products sold through sales promotion are overpriced & of poor quality etc.”.