Meanings

Sales contests are taken as one of the measures of sales promotion. A sales contest is a special selling campaign offering salesman incentives in the form of prizes or awards above and beyond those provided by the compensation plan. Sales contests are most popular with firms specializing in consumer products like food and drugs etc. The main object of sales contests is to provide sales personnel with extra incentives to increase sales volume and also bring more profits to the company. Sales contests aim at fulfilling the needs of individuals for achievement and recognition. If they are well-organized, they can be used to counter ‘off-season’ decline in sales and bring in new customers. They also generate team spirit among the salesmen and foster a sense of co-operation. These sales contests bring out the talented and more intelligent salesmen to the forefront.

Objectives of the Sales Contests

Sales contests motivate salesman to increase sales volume along with higher profits. The main objectives of sales contests are as follows:

1. To risen the sales.

2. To make new customers attracted.

3. To arrest seasonal sales slumps.

4. To push new products, high margin goods and slow moving goods.

5. To get repeated orders from present and former customers.

6. To improve sales personnel performance.

7. To bring a spirit of competition among the salesman.

8. To improve customer’s services.

9. To achieve the sales targets.

10. To increase incentives to sales force.

11. To make the products of the company popular.

12. To bring talented and intelligent salesman to the forefront.

13. To generate team spirit among the salesmen and foster a sense of cooperation.

Precautions for Planning Sales contests

Sales contests, if all they are to be a success, must be properly planned by the sales manager. In this connection the following precautions should be kept in mind before finalizing any scheme of sales contests:

1. The purpose or result aimed at should be very clearly defined and published.

2. Conditions, rules and regulations etc should be quite simple and easily understandable by all.

3. The time and date of the sales contest should be chosen with great care.

4. The sales contests should be such in which everybody can participate and have equal chances of winning the prizes etc.

5. Interest of the participants should be maintained throughout the contests.

6. Both the employer and the sales force must be benefited by the sales contests.

7. The sales contest must motivate the sales force to expand increased efforts.

8. Extra prizes should be given for the ‘first order’, ‘the biggest order’, ’the greatest number of orders’ and so on.

9. Prizes that may have a permanent value, such as watches, cycles, scooters, books etc should be given so that they my keep a salesman enthusiastic after the contest.

10 The members of the contest committee should be impartial and acceptable sales personnel.

Advantages of Sales contests

The main advantages of sales contests are as follows:

1. The sales contests increase the sales volume along with increase in profits of the company.

2. Sales contest stimulate salesman’s efforts more vigorously to attain the sales targets.

3. The possibility of winning the prizes attracts young, talented and efficient salesmen to offer their services more effectively.

4. During slump period, sales contest are the best means of not only arresting the decline in sales but also raising the volume of sales.

5. Sales contest generate team spirit among the salesmen and foster a sense of cooperation.

6. The sales contests are helpful in bringing out the talented and more intelligent salesmen to the forefront for promotion purposes.

7. Sales contests raise the morale of the sales force and develop the spirit of competition.

8. Sales contests increase the goodwill and the reputation of the company.

9. New customers are attracted on account f sales contests.

10. Consumers are also benefited by sales contests.

Disadvantages, Limitations or Objectives of Sales contests

The disadvantages, limitations or objectives of sales contests are as follows:

1. Sales contests do not really increase and sales over the long run, but they merely provide a short-term sales expansion.

2. High caliber and more experience sales personnel look upon the sales contests as juvenile and silly.

3. Sales contests cause sales personnel to launch their sales efforts during the competition and thus sales slump occurs both before and after the sales contests.

4. The disappointment suffered by sales contest losers causes a general decline in sales force morale and enthusiasm.

5. Sales contests distract salesmen from the main job of selling and encourage them only to concentrate on winning prizes by fair or foul means.

6. Sales contests lead to unanticipated and undesirable results, such as, increased returns and adjustments, higher credit losses and overshocking by dealers.

7. Sales contests are temporary devices for motivating sales force, and if used too frequently have a narcotic effect. No greater results in the aggregate are obtained with such contests.

8. When the product is in short supply, it is ridiculous to encourage sales contests.

9. It is argued that the sales force is regularly paid for their services under the basic comprehension plan. Hence there is no necessity of organizing sales contests.

10. The competition atmosphere generated by sales contest weakens team spirit.

 

 

 

 

 


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