A firm that frequently relies on sales promotion may give the impression that there are no takers of its product. Which limitation of sales promotion is this?
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Reflects crisis
Option (1) Reflects crisis — Correct. When a firm frequently relies on sales promotion, people may feel it is unable to manage its sales, or that there are no takers of its product. The constant offers look like a sign of trouble.
Option (2) Spoils product image — Incorrect. This limitation is about how buyers judge the product itself. They may feel it is not of good quality or not appropriately priced.
Option (3) Encourages sale of inferior products — Incorrect. This is an objection to advertising, not a limitation of sales promotion. It says advertising persuades people to buy even inferior products.
Option (4) Adds to cost — Incorrect. This is also an objection to advertising. Its expense adds to the cost of the product, which buyers pay as higher prices.
NCERT (2026-27 Edition): “Limitation of Sales Promotion (i) Reflects Crisis: If a firm frequently rely on sales promotion, it may give the impression that it is unable to manage its sales or that there are no takers of its product. |