ch15 sales promotion

8/6/2019 Ch15 Sales Promotion

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Chapter 15

Sales Promotions


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Sales PromotionSales Promotion is a MarketingDiscipline that Utilizes a Variety of Incentive Techniques to Structure

Sales-Related Programs Targeted toConsumers, Trade, and/or SalesLevels that Generate a Specific,

Measurable Action or Response for aProduct or Service.


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Sales Managers are Under Great Pressure toProduce Results

Quickly.

Sales PromotionStrategies Target

Consumer, Trade, andThe Sales Force.

Assessment of SalesPromotion is

Relatively Easy.

Cost for ResultsIn This Industry Are

Relatively Low.

Reasons for the Growth of Sales

Promotion

Why Are CompaniesSpending More and More

Money on Sales

Promotion?


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Promotion Strategies

Promotion Can:O ffer animmediateinducement,Cause customersto try a product,Persuadecustomers to buyagain,Introduce a newproduct or build abrand over time.

Promotion Cant:Create an image

for a brand,Compensate for alack of advertising,Do much tocompensate for anegative image,Reverse a salesdecline.


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Obj ectivesObj ectives

Intended toChange Consumer

Behavior

Building BrandsBuilding Brands

Can b e Used to BuildBrand Images, ButMay b e Long-Term

IntroducingIntroducingNew ProductsNew Products

Advertising and PromotionWork Well Together

Here UsingPush & PullStrategies

Sales Promotion Strategies


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Consumer- O rientedPromotions

Consumer-O riented

Promotion

Samples

Coupons

Premiums

Contests/sweepstakes

Refunds/rebates

Bonus packs

Price-offs

Event sponsorship


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O btaining trial and repurchase

Increasing consumption of anestablished brandDefending current customers

Targeting a specific marketEnhancing advertising and marketingefforts

O bjectives of Consumer- O rientedSales Promotion


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Advantages of CouponsO ffers price reduction only to

consumers who are price sensitiveDoes not rely on retailers cooperationGenerates trial of a new brand

Encourages non-users to try anestablished brand or users to repeatuse


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Disadvantages of CouponsDifficult to estimate redemption

rates (


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Contests

Compete for a Prize BasedOn Some Skill or A b ility

GeneratesHigh DegreeOf Consumer Involvement

Can HelpRevive

LaggingSales

Contests and SweepstakesSweepstakes

Participants Su b mit NamesTo Be Included in Drawing

Game Type of Sweepstakes;

Time Frame MuchLonger


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Effective way of getting the consumer to

become involved with the brand bymaking the promotion product relevantGenerate interest in or excitement over a brand and attracting attention to

advertisingEffective way of dealing with specificmarketing problems

Advantages of Sweepstakes andContests


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Disadvantages of Contests andSweepstakes

May overshadow the ad or brand

May detract from brand franchise or imageLegal problems and administration

Presence of professionals or hobbyistswho may submit entries and detractfrom effectiveness


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Station BreakGo to the McDonalds Web site atwww.mcdonalds.com .This site provides a variety of activities for visitorsincluding contests and sweepstakes.What is your view of contests or sweepstakeswhere children might be involved (notice that the

Web site is oriented toward younger customers)?What is the purpose of the contest or sweepstakesin this case?Do they help sell the products? Discuss in class.


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Refunds, Rebates, and

PremiumsRefunds and Re b ates

A Marketers Offer to Return a Certain Amount O f Money to the Consumer Who Purchases theProduct. i.e cash re b ate + low-value coupon

Premiums

Tangi b le Reward for Performing a Particular Act.

Direct ReceivedAt Time of Purchase

Mail Proof of Purchase & Payment

Be Mailed In


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Allowing the Customer to Experience theProduct or Service.

Very Effective Strategy for IntroducingA New or Modified Product.

Most Common Method of Distri b utingSamples is Through the Mail.

9 Out of 10 Customers Prefer a SampleTo a Cents- Off Coupon to Introduce

Product.

Sampling


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Trade PromotionsTrade advertising is directed at wholesalers andretailers and represents 50% of the totalpromotional spending.Four goals of a trade promotion are:

Stimulate in-store merchandising or other trade support,Manipulate levels of inventory held by wholesalers andretailers,Expand product distribution to new areas of the countryor new classes of trade,Create a high level of excitement about the productamong those responsible for its sale.


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Point-of-Purchase

Retailer Kits

Contests

Sweepstakes

Trade Shows

Types of Trade Promotions

Exhi b its

TradeIncentives

TradeDeals


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Promotion Integration (Tab. 15.5)Theimage cannotbe displayed.Your computer may nothaveenough memory toopen theimage, or theimagemay havebeen corrupted.Restartyour computer, and then open thefileagain.I fthe red x stillappears, you may havetodelete theimage and then insertit again.


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O bjectives of Trade- O rientedSales Promotions

O btain distribution for new products

Maintain trade support for establishedbrandsEncourage retailers to display

established brandsBuild retail inventories


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Some of the Most Popular P OP Tools & Techniques

Mechanical Product

Dispensers

Price Cards

Si ns

Banners

Special Racks

Carton Displays

Point-of-Purchase Displays Display Distri b uted to Retailers Used to Call

Customers Attention to Product Promotions.

$12 Billion Business;Second Largest Category of Sales Promo Expenditures .


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Trade Shows& Exhibits

Allow ProductDemonstrations,

Provide Information,& Answer

Questions.

$16.5 Billion isSpent Annually.

Trade PromotionsR etailer (Dealer)

Kits

Materials ThatHelp Reps MakeSales Calls AreOften Designed

as Kits.Contain DetailedProduct Specs,

How-to-Do itDisplay, etc.

Contests &Sweepstakes

Advertisers CanDevelop

Contests &Sweepstakes to

MotivateResellers.

Occasional UseOnly is Effective.


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Trade Incentives and Deals

Incentive Programsi.e. Used When Introducing

A New Product.Types Include Bonuses &

Dealer Loadings

$8 to $12 Billion Business Annually Designedfor Special Trade Promotional Circumstances.

Trade DealsMost Important Reseller Sales Promo Technique.Types Include Buying &Advertising Allowances


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Sponsorships and EventMarketing

Sponsorships include a number of activitiesincluding:

sports sponsorships,entertainment tours and attractions,festivals,fairs, and annual events,cause marketing associating with an event thatsupports a social cause, andarts.


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Sponsorships and EventMarketing

Event marketing describes the marketingpractice in which a brand is linked to an event tocreate experiences for customers and associatethe brand personality with a certain lifestyle.

A sponsorship occurs when a companysponsors a sports event or concert, or supports acharity with its resources.It is attempting to increase the perceived value of the sponsors brand in the consumer's mind.Blimps, balloons, and inflatables are used atmany events.


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Build Brands; CreatingBoth Awareness and

Reminders

Includes EverythingFrom Hats With Logos to

T-shirts, & Mousepads

Normally Have aPromotional MessagePrinted Somewhere

Third LargestCategory of Promotional

Spending

Specialty Advertising

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