Definitions and explanations
Sales simply mean all those activities used to sell the products and services in the market. But, in a broader term, the word sale represents much more than just selling products and services. Businesses have proper sales organizations where they have their sales team who try to close more deals, increase the level of efficiency of sales processes and trim down the time and effort it takes to make a sale. For businesses, a sale is to make an effort to satisfy a customer and increase revenue for the company.
Advertising is also called a paid announcement by an identified sponsor for calling the attention of the public towards any product, idea or service. It is also known as a promotional tact to influence, communicate, and inform people or customers about your products and services. The goal of advertising is to attract new customers and reach out to the target market through an effective and result-oriented ad campaign.
Differences between sales and advertising:
The difference between sales and advertising has been detailed below:
The sales function is more towards push strategy where sales representatives push their products through different types of distribution channels. Most significant distribution channel starts from wholesalers, who push the product to retailers. Retailer’s use different tactics to push those products towards customers, such as buy-back guarantees and free trials, etc. Whereas, advertisement functions with a pull product strategy where, products are pulled through distribution channels to deliver message to customers. In turn, consumer demands goods. Different deals and coupons can be used to allure this pull product strategy to function in a targeted manner.
Business people have many objectives related to sales and advertising. Sales department introduces different benefits and features of products; they also compare the key feature of their products with that of competitors. The objective behind all these efforts is to close the sale. Advertisement, on the other hand, deals with the objectives explained in shape of the AIDA (attention, interest, desire, and action). Advertisers use different strategies and techniques to develop customer interest and desire for the product. They influence the customers through an ad campaigns and in return customer visits a store and buys the product.
Sales representatives reach their target customers either by calling them on phone or visiting them personally. It is a two-way communication process where sales representatives share information about products and services and customers are free to ask questions. Advertising is a non-personal kind of promotion strategy where, a one-way communication process is used from business to convey things to customers. This is a method of reaching customers simultaneously through billboards, magazines, televisions, newspaper, and internet, etc.
A sale is not a frequent activity to be used as compared to advertising. It is a simple process of visiting the customers, making a sale and shipping the products to the customer’s required destination. The sales representative may not be visiting the customers frequently/again for another month or two. Advertising is a more frequent activity to be carried out by companies to reach their target customers. Advertising can be on a daily, weekly or monthly basis depending upon the type of media to be used. Frequent use of advertising is also important because customers often need to hear the advertisement, again and again, to understand the offer or recognize a specific brand or company.
5. Occurrence of business transaction:
A sale is an actual financial transaction which impacts the financial position of both buyer and seller. The advertisement is a promotional marketing tool that creates awareness and attractiveness among potential buyers. It cannot enforce someone to pay any cash to anyone unless the buyer actually makes a purchase. Thus, the advertising may financially impact the marketer only and not the audience.
6. Nature of activity and impact on cash flow
For any business, sale is a revenue generating activity which causes an increase in revenues and thus cash inflows and profits. Advertising, on the other hand, is an operating expense of the business which causes an outflow of cash.
7. Existence of contract
The occurrence of sale mostly constitutes a contract between buyer and seller. The marketing does not amount to a contract between marketer and the audience unless and until a person actually buys an item after seeing the ads.
Sales vs advertising – tabular comparison
A tabular comparison of sales and advertising is given below:
|Different channels of distributions are used as a push product strategy to make the product available to customers through retailers.||It functions as a pull product strategy to convey a message to customers to increase the demand for the product.|
|The main objective behind sales or the sales department is to close the sale with efficiency.||Advertisers work to create interest and desire for the product among customers.|
|The sales representatives reach their customers with a two-way communication strategy and for this purpose; they may use phone calls or personal visits.||Advertisement media is a one-way communication process of reaching target customers with the help of newspapers, billboards, television, etc.|
|Sales department works day and night to increase the sales or close the sale but it is not a frequent activity. Once products reach the desired destination of the customer, the sale is considered closed and sales representatives do not visit the customers afterward.||Advertisers use the advertising media frequently to convey the message to customers. Customers need to hear the advertisement again and again on a daily, weekly or monthly basis to understand the offer.|
|Occurrence of transaction|
|It amounts to a valid financial transaction between seller and customer.||It does not involve in any transaction between advertiser and their audience.|
|Nature of activity and impact on cash flow|
|It is a revenue generating activity which brings cash into the business.||It is a business expenses which causes an outflow of cash from business.|
|Existence of contract|
|It constitutes a contract between seller and buyer||It does not result in any contract between advertiser and their audience unless and until an actual sale happens.|
Conclusion – sales vs advertising
Sales and advertising both are important functions of marketing. These two are linked with getting the product from its idea stage to targeted customers. Sales involve a transaction between two parties where the buyer receives goods either tangible (products) or intangible (services) and the seller receives money for the same. In simple words, a sale is a contract or an agreement between buyer/consumer and seller of a specific good or service. Advertising is known to be the support for the sales department. Advertisers use several strategies to convey, influence and inform the customers about the product which in turn helps increase the sales of the product. Advertisement is an important way to know about your target audience before you reach them with different campaigns and offers to support and increase the sales of the company.