DIFFERENT PROGRAMMES OF SALES PROMOTION

The marketer must make some additional decision to define the full promotion program. How much incentive to offer? Who can particular? How to advertise sales promotion? How long should last? When it should start? How much to budget?

INCENTIVE:-

A certain minimum incentive is necessary, if the promotion is to succeed, a higher incentive level will produce more sales response, but a diminishing rate some of the large consumer packaged, good fire have a sales promotion. Manager who studies the effectiveness of past promotion and recommends appropriate incentive of brand manager.

CONDITION FOR PARTICIPATION:-

Incentives might be offer only to those who turn in box top. Sweepstakes might not be offered in certain states or to families of company personal or to person under a certain age.

DISTRIBUTION VEHICLE FOR PROMOTION:-

The marketer must decide how to promote and distribute the promotion program. A fifteen cent of coupon could be distributed in the packaged, store, mail and advertising media. Each distribution methods involve a different level of reach and cost.

DURATION OF PROMOTION:-

If the sales promotion period is too short, many prospects will not be able to take advantage since they may not be repurchasing at the time. If the promotion turns too long the deal will lose some of its act now force according to one researcher the optimal frequency that about there week per quarter and optimal duration is the length of the coverage purchase cycle.

TIMING OF PROMOTION:-

Brand manager need to develop calendars date for the promotion. The date will be used by production, sales and distribution. Some unplanned promotion will also be need and require cooperation on short notice.

TOTAL SALES PROMOTION BUDGET:-

The marketer can be developed total sales promotion budget in two ways. The marketer can choose the promotion and estimate their total cost. The most common way is to take a conventional percentage of use for sales promotion. Lack of consideration is cost effectiveness. Use of simple decision rules such as extension of last years spending percentage of expected sales maintain of fixed ratio of advertisement. Advertisement and sales promotion budgets being prepared independently.

PRE-TESTING:-

Sales promotion tools should be pre-tested when possible to determine, if they are appropriate and of the right incentive size.

IMPLEMENTING:-

Companies should established implementation plan for each promotion covering lead time and sell of time. Sell of time is the time necessary to prepare the time beings with the launches and ends when the deals close.

ADVANTAGE OF SALES PROMOTION:There are three main specific advantage of promotion y y y To communicate To convince To compete

Communication is the basis of all marketing in fact. It involves much in addition to the stimulation sales, more over and most marketing communications are promotional. It is not enough nearly to communicate ideas must be convincing, so that action would follow. In other word distribution of information should be capable of producing marketing result. Promotion is the mode of communication adopted by business community for achieving specific objective.

According to the view point of seller such communication may become necessary to modify consumer behaviors and thought. Thus, the objective of promotion is under to provide information to prospective customer about the availability, features and used product. To stimulate demand by creating awareness and interest among customers. To differentiate product from competitive products by creating brand loyalty. To established sales by highlighting the utility of the product. It is a source of education to the customers.

DISTRIBUTION CHANNEL OF JAYPEE CEMENT:l St a t egy r

Distribution Channel Strategy:Market Factorsy y y Buyer behavior- do they prefer to buy from retailers or directly. Buyer needs- for product information and service. Intermediary cost- mark up or commission for participating in the channel.

Producer factorsy Whether the producer has the systems to perform the functions neededCustomer based skills to dist the prods. y Extent to which producers want to maintain control over how, to whom and at what price a product is sold. Direct dist gives producer a much better control over these issues. y (nowadays companies are shifting to company owned stores as intermediaries only push products which have higher margins).

Distribution intensity

y
y

Intensive dist- aims to provide saturation coverage of the market using all available channels. Selective dist- limited number of outlets in a geographical area. A advantage of this approach is that the producer can choose the most appropriate or the best performing outlets.

Exclusive Dist- only one wholesaler, retailer etc handles a particular area.

DISTRIBUTION STRATEGY OF JAYPEE CEMENT

Conventional Distribution Channe Vertical Marketing Systems

Conventional marketing channel Manufacturer Vertical marketing channel Manufacture r

Wholesaler Retaile r Consume r

Wholesal

Retaile r

TRANSPORTATION OF JAYPEE CEMENT:y

y y y

Transportation costs high - freight accounts for 17% of the production cost Road preferred mode for transportation for distances less than250kms. However, industry is heavily dependent on roads as the railway infrastructure is not adequate shortage of wagons. Nearly 55-60% of the inputs controlled by the government Facing problems due to power shortage Coal availability and quality affecting production Mini plants realization of revenue lower than large plants, survival difficult .

FUTURE DEMAND OF JAYPEE CEMENT:Infrastructure & construction sector the major demand drivers. Some demand determinants Economic growth Industrial activity Real estate business Construction activity Investments in the core sector.

    

FUTURE OF JAYPEE CEMENT:   y    y y y y

growth in the housing sector central road fund established for national highways and railway over bridges to provide the necessary impetus expansion plans, Greenfield projects on the anvil Capacity likely to be 146.9 mn. tones by 2007 - 2009 By 2008 8 mn tones addition expected 2008-2009 - 10 mn tones 2010 - 2011 - 30 mn tones Demand - supply balance expected in the next 12 - 15 months Higher capacity utilization likely in the future Encouraging trend in demand due to pick-up in rural housing demand and industrial revival Industry likely to grow at 8-10% in the next few years

Cement India is the second largest producer of cement in the world after China. However, per capita consumption of cement is only 131kg per annum (Source: CMA), which is significantly below the average level of consumption even for developing countries. Cement consumption in India has witnessed a compound annual growth rate of 8 percent over the last five years, with current year growth of 8.13 per cent(Source: CMA). The Company believes that there will continue to be significant growth in consumption. The cement market in India is highly fragmented and regionalised, as a result of the high cost of transport of cement compared to its value. This has led to regional variation in the supply-demand balance. The Companys cement production facilities are located in Central India, with more than 90 per cent of its cement production being sold to customers within Uttar Pradesh, Bihar and Madhya Pradesh within a 600 kilometre radius of its production facilities. The states of Uttar Pradesh, Bihar and Madhya Pradesh account for approximately 33 per cent of the population of India. In order to take advantage of the anticipated increase in demand for cement in its markets, the Company has recently completed the expansion of its production capacity from 7.0 million MTPA to 14.70 MTPA by setting up a 3.0 million MTPA plant at in Uttar Pradesh, 2.0 MTPA plant at Sidhi, 1.5 MTPA grinding unit at Panipat in Haryana and 1.2 MTPA cement capacity in Gujarat. Major capacity expansion is currently underway through greenfield additions, acquisitions, subsidiaries and joint ventures with new cement plants coming up in the Northern, Central, Western and Eastern regions of the country. The Company believes that these developments will make the Group the third largest cement producing group in India, with 33.5 million MTPA of installed capacity by FY12.

With the recent completion of the expansion and modernisation programme, the Companys cement business has also addressed the issue of the cost and reliability of power. The cost of power accounts for approximately 31 per cent of the total cost of cement production. The operating cement business at Rewa, Siddhie and UP has installed coal based thermal power plants with 188 MW capacity as on 31st May, 2009, making it self sufficient in power and allowing it to benefit from significant production synergies. The Company believes that the cost savings made as a result of its power plant construction will enhance its competitive position.