Strategic Thought Transformation - The IIPM Think Tank

CONSUMER B E H A V I O U R
Promotional Schemes:
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Dr. Sadia S. Ali, Aligarh Muslim University
The market has been flooded with promotional
schemes that are essentially
meant to keep the existing customers
loyal or to entice the new ones. This article
deals with consumer response to such promotional
schemes. An analytical approach
has been proposed to make a comparative
study of the schemes as well as to study the
consumer response to some well-known
schemes. Data from a survey by Jamal
(2002) has been used for illustration.
Introduction
What is this study about
‘Globalisation’ and ‘Open-market’ are used
in almost all the South-Asian countries.
Earlier on, most of the countries in this
region used to be ‘traditional’ in dealing
with the customers at the lower levels, in
the sense that the wholesalers had their set
of retailers and each retailer had a set of
‘loyal’ customers. Brand switching was rare
and trade flourished on ‘faith’ and ‘counter-faith’.
With the opening up of markets
to ‘imported goods’, coming up of new
ideas along with multinational firms and
multi-cultural goods, was a must. Hitherto
unknown commodities have become the
‘article of faith’, now so much so that one
wonders as to how we were living without
these ‘essentials’. All this has not happened
in a day nor is the transformation complete.
The changes are gradual and on-going. The
introduction of providing incentives either
to ‘lure the customers’ or ‘to keep them
in the net’ is a new phenomenon for the
countries in this region. We present an
analytical study of these ‘customer-catching’
techniques known as ‘promotional
schemes’ and consumer response to the
‘allurements’.
What are promotional schemes
Sales of consumer items with some promotional
scheme is a very common phenomenon
now-a-days. This may be regarded as
an extension to the advertising campaign.
The basic idea is to increase the sales by
attracting new customers or by increasing
With the opening
up of markets to
‘imported goods’,
coming up of new
ideas along with
multi-cultural
goods, was a must
the number of items purchased by the existing
customers. Studies corresponding to
this aspect of advertising have been made
earlier also. In a book published in 1987 4 ,
titled ‘Advertising’, the authors discussed
this aspect. Recently, some new books have
appeared containing studies on advertising
price-promotions. 3,2 The list of the possible
promotional schemes is too large to be
taken up in full. In section 2, the modus operandi,
merits and limitations of a selected
few of commonly used schemes, along with
possible consumer reaction to each one,
have been discussed. A statistical method
for measuring the consumer response to
various promotional schemes has been
discussed in section 3. Finally, in section
4, a survey report has been presented and
analysed. The data for this survey has been
obtained from Aligarh and Delhi, in India,
the choice is neither arbitrary nor just a
matter of convenience. Aligarh is the city
of Aligarh Muslim University, which is not
only an institution of international repute;
it has the cross-currents of the South-Asian
population composition. Delhi is the capital
city and its more than 10 million populations
represent various forms of behaviour.
Samples have been so drawn as to include
various segments of the society. Thus, the
conclusions drawn here are valid for any
place in general and the entire South-Asian
region in particular.
1. Promotional Schemes:
An IIPM Intelligence Unit Publication STRATEGIC INNOVATORS 35