sales promotion and turkcell

8/9/2019 Sales Promotion and Turkcell

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DEFINITION OF SALES PROMOTION

Sales promotion is any type of tool undertaken by an organization to increase its sales and the usage ortrial of a product or service. It is possible talk about different types of sales promotions. Often they areoriginal and creative, and hence a comprehensive list of all available techniques is virtually impossible

because every day a new type of promotion is introducted on the market.

Sales promotions traditionally are complementary to advertising. They are used to reinforce andencourage customers to try the product and than purchase it. Sales promotion provides a range of short-term tactical measures to induce sales or particular products or services now rather than at some pointin the future. In that sense, they are sales accelerators. Its aim is to provide extra value to the product orservice, crating the extra impetus to purchase products that customer might not normally buy. (Hughesand Fill, 2007).

According to Shimp (2000), sales promotion is used to induce the trade and/or consumers to buy abrand and to encourage the sales force to aggressively sell it. In retail, sales promotion is also used toencourage desired behavior from customers - come to store rather than a competitors, buy one brandrather than another, purchase larger quantities.Shimp (2000) is adding that effective sales promotion, from a consumer-response perspective, mustmake it relatively easy for consumers to obtain their reward, and the size of the reward must besufficient to justify the consumers` efforts. This was summarized by Raghubir et.al (2004) who definedthat from the customers` perspective economic effects of sales promotion can be divided into monetaryand non-monetary gains or loses.

Apart from economic effects of promotion, Raghubir (2005) is suggesting that promotions are also asource of information that consumers use to make judgements about products and their prices. On thetop of that, third effects of sales promotion are the affective benefits which are based on the hedonicbenefits of exploration, value expression and entertainment. The affective costs include regret (ofmissing a promotion), embarrassment, and irritation (due to the need to comply with restriction to availof a promotion).

Brassington and Pettit (1997) carried out classifications of sales promotion techniques from consumerperception:

1. Money-based promotion:

Reduced price offers - One of the most frequently employed tactics in the sales promotionrepertoire of retailers is the provision of special discounts. Such in-store promotions take placewithin a store in an unannounced and unpredicted manner at the point of sale, allowing consumers toexperience unexpected savings, or windfall gains (Ha, et.al, 2006). On the top of that, if customerexperience unexpected or unanticipated saving (or gains), they are likely to spend the saved amountmore easily comparing to situation, when they have been looking for saving on purpose or if they wereexpecting gains (Arkes et.al, 1994).- on shelf reduced price offers at the point of sale of the product. The reduction does not appear on

product itself, but on leaflets advertising or on surrounding notices- on pack offer actually features on the product pack itself. The offer originates from manufacturer orit has form of joint promotion between the manufacturer and one particular retailer.


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Coupons more complex money-based sales promotion. They are printed vouchers whichconsumers take to a retail outlet and uses to claim a set amount of money off a product. There arevarious forms of coupons. They can be printed within advertisements, on leaflets delivered from doorto door, on inserts within magazines and newspapers, through direct mail, at the point of sale and onpacks and latest popular one are e-coupons which are used for discounts while shopping online.

Yeshin (2006) is adding that coupons can be designed to have different impacts on the consumer andtherefore they can be further divided into coupons valid for this purchase, next purchase or multiplepurchases. On the cost side, one of the major costs of a coupon program is the value of the couponsredeemed. If only consumers who would have bought the promoted brand anyway redeem coupons,then coupon redemption would always result in lower profitability. On the other hand, profitability ofthe couponing operation depends on both the incremental sales and the redemption rate (Leone andSrinivasan, 1996). From customer perspective, Huff and Alden (1998) propose that attitudes towardcoupons are influenced by the following factors: (1) familiarity with coupons, (2) attitudes of familyand friends toward using coupons, (3) fear of embarrassment or losing face when using coupons, and(4) the consumer's price consciousness.

Rebates it is also called `cash-back` scheme which involves a little more work and loyaltyfrom the consumer. Tokens or labels to be collected from packaging, involving a number of purchasingepisodes, and then mailed in to qualify for either hard cash or a substantial coupon (retailer or productspecific). However, rebates are associated with greater expenditures of time and energy for redemptionthan free features. Therefore, retailers and marketers need to be aware of the extent to whichperceptions of the time and effort are involved in redeeming different types of discounts. Consequently,the redemption effort is likely to have a negative influence on perceptions of the value (Munger andGrewal, 2001).

Hughes and Fill (2007) are adding another technique try before you buy promotion in whichconsumer has opportunity to have product for limited period of time for free.

On the top of that, Yeshin is adding price-matching promotion in which retailer is offering tomatch competitors price within certain area. This marketing tool is a signal of price beating offers andclaims that store has the lowest prices what may have important implications for consumer priceperceptions and behaviour. It may be more efficient for retailers to offer and advertise price-matchingguarantees than to advertise specific low prices. The rationale is that a price-matching guaranteegenerally includes all the merchandise in a store while advertised prices include only a fraction of thestock. A price-matching guarantee thus constitutes an umbrella pricing tactic which is indicative ofthe overall price level of a store (Srivastava and Lurie, 2004).

2. Product-based promotion:

Extra producta) Extra free This technique involves offers such as `20% extra free`. To make sure, customerunderstand what 20 per cent looks like, the packaging, for example a can, would have band around thetop of the label in a different colour from the usual packaging giving a rough idea of which part of thecontents is free. However, Ong et.al (1997) suggests that consumers appear not to give bonus packoffers too much credence. Their surveys shows, that they slightly agree that the offer was hard tobelieve. As for pricing, consumers suspect that manufacturers do raise prices slightly in conjunctionwith offered bonus pack.


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b) BIGIF or BOGOF again, in promotion customers are offered extra free product. The BIGIF standsfor Buy 1 Get 1 Free and BOGOF is written version of it - Buy one get one free. Effectively, the offeris saying `100 extra free`. As Parguel et.al (2007) stated, although the incremental cost is difficult toassess, pre-wrapped bundles are more expensive than separate-item ones,. In reality, separate-itembundles deliver value, drive volume, retain loyalty and build share, without modifying the processes at

work at the manufacturer and retailer levels.

c) Banded packs Yeshin define that these can be same product or assorted product and it basicallymeans that there would be some kind of discount if more products are bough (3 for 2, 20% of if bought2)d) Samples The importance of product trial an direct behavioural experience with a product isrecognized by marketing mangers (Ndubisi & Moi, 2005) therefore main objective of samples is topersuade people to try a product- On-pack samples can be given away with existing products- Trial sizes can be sold in retail outlets at a minimal price- Print media this allow targeting of fairly narrowly profiled audiences, what can be efficient way ofdistributing samples to potential buyers- Direct mail if samples are small, light and non-perishable, they can be distributed by direct mail,either to people already on a mailing list, or to those who respond to an offer made in an advertisements- Door to door popular, but expensive way of distributing samples. Effectively, samples are puttingdirectly into peoples hands in an environment, where it is likely to be remembered and used.

3. Gift, prize or merchandise based promotion

a) Self-liquidating offers invite the customers to pay a small amount of money, and usually to submitspecified proofs of purchase, in return for goods that are not necessarily directly related to the mainproduct purchase. The money paid is usually just enough to cover the cost price of the goods and acontribution to postage and handling.

b) Free mail-in consumer can claim a gift, free of charge, in return for proofs of purchase and perhapsthe actual cost of postage (but no handling charges or the cost of the gift itself)

c) Free inside or on-pack means offering free gifts contained inside or banded on to the outside of thepack.

d) Free with product is similar to an on-pack offer, except that the gift is not attached to product, buthas to be claimed at the checkout.

e) Customer loyalty schemes these are designed to encourage repeat buying, especially whereswitching is easy and generic brand loyalty is low.

f) Contest and sweepstakes this allow organisation to offer very attractive and valuable incentives, suchas cars, holidays or large amounts of cash to very small number of purchasers who happen to be luckyenough to win. Contests have to involve a demonstration of knowledge, or of analytical or creativeskills to produce winner. On the other hand, sweepstakes do not involve skill, but offer every entrant anequal chance of winning through the luck of the draw.


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4. Store based promotion

a) Point of sale display methods includes posters, displays, dispensers, dump bins and other containersto display products.

b) Demonstration is powerful means of gaining interest and trial.

The key aims and objectives of sales promotions for retailers will be to increase sales through a rangeof promotional techniques:- Increase in-store and customer traffic the use of coupons and money-off vouchers- Increase frequency of purchase discounted promotions for next purchase- Increase in-store loyalty through the use of storecards and rewards systems- Increase own brand sales encourage customers to purchase own brand products through a rangeof sale promotion incentives such as trial packs, in-store demonstrations and so on- Achieve consistent demand reduce fluctuations, provide sales promotions in particular timebands to encourage a more consistent approach to shopping (Hughes and Fill, 2007).

According to Dawes (2004) successful price promotion:

(1) have no identifiable positive or negative longer-term effect on the volume for the brand that waspromoted;

(2) do temporarily expand the category for the duration of the promotion;

(3) have an identifiable negative effect on the sales volume of one competing retailer chain in theperiod of the promotion, but not on the sales volume of the other two retailers;

(4) did have a longer-term negative impact on category sales for the retailer than ran the promotion.

From retailers perspective, sales promotion and in fact generally whole marketing promotion been for awhile two poles of battlefield profit versus cost basis. The management of companies is facingchallenging decision to which side they should incline to. On one hand, the highly competitive marketplace compels marketers to increase their spending on the promotional mix. On the other hand,simultaneously, promotional expenditures are being examined closely by top management as one forthe most promising areas left for cutting costs and increasing profits (Srinivasan & Anderson, 1998).

On the other hand, from customers perspective, promotions provoke two reactions in people. The firstis an increase in consumption, i.e. more quantity of a product is acquired. The second is storage of theproduct for the future, i.e. the consumer acts anticipating his purchases. These expectations oranticipations increase the probability of purchase when customers encounter an unexpected pricepromotion on a brand while decreasing purchase likelihood to a greater extent if they expect the brandto be promoted and it is not (Raghubir et.al 2004). On the top of that, Alvarez & Casielles (2004)adding that the influence of sales promotions on the consumer will also depend on the consumerscharacteristics and these can be divided into three types of consumer segments:

(1) those who find these actions attractive and are therefore likely to buy the product;


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(2) those who find them neither attractive nor necessary, and will therefore act by reducing their choiceprobability; and

(3) those who remain indifferent and are therefore not affected by these actions in their final decision.

Retailers also use promotional incentives to encourage desired behaviours from consumers. Salespromotion is more short-term oriented and capable of influencing behaviour (Ndubisi & Moi, 2005).However, in many market sectors, brands are perceived as being on constant promotion, which resultsin consumer confusion as to the real price of the brand (Lucas, 1996). Therefore, if the consumer iscapable of anticipating when a sales promotion action will take place, the results obtained willdecrease. Moreover, it is necessary for the consumer not to be able to anticipate sales promotions, andthus not to incorporate these incentives into the products characteristics (Alvarez & Casielles, 2004).

According to research conducted by Gilbert and Jackaria (2002), in which they investigated fourmost common sale promotion tools in UK supermarkets (Buy One Get One Free, price discounts,coupons and samples), only discounts has statistically significant influence on consumer`s reportedbuying behaviour. On the other hand, although BOGOF was statistically not significant, brandswitching behaviour and purchase acceleration were statistically significant. On the top of that, buy oneget one free promotion is the most popular promotion type among consumers followed by discount.Borges et.al (2005) are adding, that knowing the implications of promotional assortment on thepromotion utility, retailers can propose promotional actions that increase store traffic and develop theprice image of the store. There is greater efficiency by managing buying association as retailers canreduce redundancy effects and produce more profitable promotional actions. Moreover, Kostolny(2008) suggesting that one of the main rules of sales promotion is that it is exchange of advantages. Onone side, customer is gaining in different variation lower price per unit. On the other side, in exchangefor it seller is expecting increases in turnover by attracting new customers, increasing presentcustomers` flow or buying repetition, or by bigger spent from current customers.

Actually, the most used sales promotions activities are:

(a) Buy-One-Get-One-Free (BOGOF) - which is an example of a self-liquidating promotion. Forexample if a loaf of bread is priced at $1, and cost 10 cents to manufacture, if you sell two for $1, youare still in profit - especially if there is a corresponding increase in sales. This is known as aPREMIUM sales promotion tactic.

(b) Customer Relationship Management (CRM) incentives such as bonus points or money off coupons.There are many examples of CRM, from banks to supermarkets.

(c) New media - Websites and mobile phones that support a sales promotion. For example, in theUnited Kingdom, Nestle printed individual codes on KIT-KAT packaging, whereby a consumer wouldenter the code into a dynamic website to see if they had won a prize. Consumers could also text codesvia their mobile phones to the same effect.

(d) Merchandising additions such as dump bins, point-of-sale materials and product demonstrations.


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(e) Free gifts e.g. Subway gave away a card with six spaces for stickers with each sandwich purchase.Once the card was full the consumer was given a free sandwich.

(f) Discounted prices e.g. Budget airline such as EasyJet and Ryanair, e-mail their customers with thelatest low-price deals once new flights are released, or additional destinations are announced.

(g) Joint promotions between brands owned by a company, or with another company's brands. Forexample fast food restaurants often run sales promotions where toys, relating to a specific movierelease, are given away with promoted meals.

(h) Free samples (aka. sampling) e.g. tasting of food and drink at sampling points in supermarkets. Forexample Red Bull (a caffeinated fizzy drink) was given away to potential consumers at supermarkets,in high streets and at petrol stations (by a promotions team).

(i) Vouchers and coupons, often seen in newspapers and magazines, on packs.

(j) Competitions and prize draws, in newspapers, magazines, on the TV and radio, on The Internet, andon packs.

(k) Cause-related and fair-trade products that raise money for charities, and the less well off farmersand producers, are becoming more popular.

(l) Finance deals - for example, 0% finance over 3 years on selected vehicles.

These types of examples above are focused upon consumers but sometimes promotions can be aimed atwholesales and distributors as well. These are known as Trade Sales Promotions. Examples here mightinclude joint promotions between a manufacturer and a distributor, sales promotion leaflets and othermaterials (such as T-shirts), and incentives for distributor sales people and their retail clients.

Principal aims of Sales Promotion

Sales promotion is usually adopted to achieve most of thefive major promotional objectives:

Building Product Awareness

Many sales promotion techniques are effective in exposing customers to products for the first time andcan serve as key promotional components in the early stages of new product introduction.Additionally, as part of the effort to build product awareness, several sales promotion techniquespossess the added advantage of capturing customer information at the time of exposure to thepromotion. In this way sales promotion can act as an effective customer information gathering tool(i.e., sales lead generation), which can then be used as part of follow-up marketing efforts.

Creating Interest

Marketers find that sales promotions are very effective in creating interest in a product. In fact,creating interest is often considered the most important use of sales promotion. In the retail industry anappealing sales promotions can significantly increase customer traffic to retail outlets. Internet


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marketers can use similar approaches to bolster the number of website visitors. Another important wayto create interest is to move customers to experience a product. Several sales promotion techniquesoffer the opportunity for customers to try products for free or at low cost.

Providing Information

Generally sales promotion techniques are designed to move customers to some action and are rarelysimply informational in nature. However, some sales promotions do offer customers access to productinformation. For instance, a promotion may allow customers to try a fee-based online service for freefor several days. This free access may include receiving product information via email.

Stimulating Demand

Next to building initial product awareness, the most important use of sales promotion is to builddemand by convincing customers to make a purchase. Special promotions, especially those that lowerthe cost of ownership to the customer (e.g., price reduction), can be employed to stimulate sales.

Reinforcing the Brand

Once customers have made a purchase sales promotion can be used to both encourage additionalpurchasing and also as a reward for purchase loyalty (see loyalty programs below). Many companies,including airlines and retail stores, reward good or preferred customers with special promotions, suchas email special deals and surprise price reductions at the cash register.

Different Types of Sales Promotion

According with the latest marketing theories (Brassington and Pettit -1997), sales promotion can beclassified based on the primary target audience to whom the promotion is directed. These include:

* Consumer Market Directed - Possibly the most well-known methods of sales promotion are thoseintended to appeal to the final consumer. Consumers are exposed to sales promotions nearly everyday,and as discussed later, many buyers are conditioned to look for sales promotions prior to makingpurchase decisions.

* Trade Market Directed Marketers use sales promotions to target all customers including partnerswithin their channel of distribution. Trade promotions are initially used to entice channel members tocarry a marketers products and, once products are stocked, marketers utilize promotions to strengthen

the channel relationship.

* Business-to-Business Market Directed A small, but important, sub-set of sales promotions aretargeted to the business-to-business market. While these promotions may not carry the glamourassociated with consumer or trade promotions, B-to-B promotions are used in many industries.

In the next few sections we discuss each category in more detail.


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Consumer Sales Promotion (B2C)

Consumer sales promotions encompass a variety of short-term promotional techniques designed to

induce customers to respond in some way. The most popular consumer sales promotions are directlyassociated with product purchasing. These promotions are intended to enhance the value of a productpurchase by either reducing the overall cost of the product (i.e., get same product but for less money) orby adding more benefit to the regular purchase price (i.e., get more for the money).

While tying a promotion to an immediate purchase is a major use of consumer sales promotion, it is notthe only one. As we noted above, promotion techniques can be used to achieve other objectives such asbuilding brand loyalty or creating product awareness. Consequently, a marketers promotional toolboxcontains a large variety of consumer promotions.

Next we discuss the following 11 types of consumer sales promotions:

1. Coupons2. Rebates3. Promotional Pricing4. Trade-In5. Loyalty Programs6. Sampling and Free Trials7. Free Product8. Premiums9. Contests and Sweepstakes10. Demonstrations11. Personal Appearances

Coupons

Most consumers are quite familiar with this form of sales promotion, which offers purchasers pricesavings or other incentives when the coupon is redeemed at the time of purchase. Coupons are short-term in nature since most (but not all) carry an expiration date after which the value may not bereceived. Also, coupons require consumer involvement in order for value to be realized. In most casesinvolvement consists of the consumer making an effort to obtain the coupon (e.g., clip from newspaper)and then presenting it at the time of purchase.

Coupons are used widely by marketers across many retail industries and reach consumers in a numberof different delivery formats including:

* Free-Standing Inserts (FSI) Here coupon placement occurs loosely (i.e., inserted) within media,such as newspapers and direct mail, and may or may not require the customer to cut away from othermaterial in order to use.

* Cross-Product These consist of coupons placed within or on other products. Often a marketerwill use this method to promote one product by placing the coupon inside another major sellingproduct. For example, a pharmaceutical company may imprint a coupon for a cough remedy on the


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box of a pain medication. Also, this delivery approach is used when two marketers have struck a crosspromotion arrangement where each agrees to undertake certain marketing activity for the other.

* Printout A delivery method that is common in many food stores is to present coupons to acustomer at the conclusion of the purchasing process. These coupons, which are often printed on thespot, are intended to be used for a future purchase and not for the current purchase which triggered the

printing.* Product Display Some coupons are nearly impossible for customers to miss as they are located inclose proximity to the product. In some instances coupons may be contained within a coupon dispenserfastened to the shelf holding the product while in other cases coupons may be attached to a specialdisplay (see POP display below) where customers can remove them (e.g., tear off).

* Internet Several specialized websites, such as HotCoupons.com, and even some manufacturerssites, allow customers to print out coupons. These coupons are often the same ones appearing in othermedia, such as newspapers or direct mail. In other cases, coupons may be sent via email, though to beeffective the customers email program must be able to receive HTML email (and not text only) inorder to maintain required design elements (e.g., bar code).

* Electronic The Internet is also seeing the emergence of new non-printable coupons redeemablethrough website purchases. These electronic coupons are redeemed when the customer enters adesignated coupon code during the purchase process.

Rebates

Rebates, like coupons, offer value to purchasers typically by lowering the customers final cost foracquiring the product. While rebates share some similarities with coupons, they differ in several keysaspects. First, rebates are generally handed or offered (e.g., accessible on the Internet) to customersafter a purchase is made and cannot be used to obtain immediate savings in the way coupons are used.(So called instant rebates, where customers receive price reductions at the time of purchase, haveelements of both coupons and rebates, but for our purposes we will classify these as coupons due to thetiming of the reward to the customer.)

Second, rebates often request the purchaser to submit personal data in order to obtain the rebate. Forinstance, customer identification, including name, address and contact information, is generallyrequired to obtain a rebate. Also, the marketer may ask those seeking a rebate to provide additionaldata such as indicating the reason for making the purchase.

Third, unlike coupons that always offer value when used in a purchase (assuming it is accepted by theretailer), receiving a rebate only guarantees value if the customer takes actions. Marketers know thatnot all customers will respond to a rebate. Some will misplace or forget to submit the rebate whileothers may submit after a required deadline. Marketers factor in the non-redemption rate as theyattempt to calculate the cost of the rebate promotion.

Finally, rebates tend to be used as a value enhancement in higher priced products compared to coupons.For instance, rebates are a popular promotion for automobiles and computer software where largeamounts of money may be returned to the customer.


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Promotional Pricing

One of the most powerful sales promotion techniques is the short-term price reduction or, as known insome areas, on sale pricing. Lowering a products selling price can have an immediate impact ondemand, though marketers must exercise caution since the frequent use of this technique can lead

customers to anticipate the reduction and, consequently, withhold purchase until the price reductionoccurs again.

As we will see in the Setting Price Tutorial, promotional pricing is also considered within theframework of the Price marketing mix component. More on of this technique is provided in thatdiscussion.

Trade-In

Trade-in promotions allow consumers to obtain lower prices by exchanging something the customerpossess, such as an older product that the new purchase will replace. While the idea of gaining pricebreaks for trading in another product is most frequently seen with automobile sales, such promotionsare used in other industries, such as computers and golf equipment, where the customers exchangedproduct can be resold by the marketer in order to extract value.

Loyalty Programs

Promotions that offer customers a reward, such as price discounts and free products, for frequentpurchasing or other activity are called loyalty programs. These promotions have been around for manyyears but grew rapidly in popularity when introduced in the airline industry as part of frequent-filerprograms. Loyalty programs are also found in numerous other industries, including grocery, pizzapurchasing and online book purchases, where they may also be known as club card programs sincemembers often must use a verification card as evidence of enrollment in the program.

Many loyalty programs have become ingrained as part of the value offered by a marketer. That is, aretailer or marketing organization may offer loyalty programs as general business practice. Under thiscondition loyalty program does not qualify as a sales promotion since it does not fit the requirement ofoffering a short-term value (i.e., it is always offered). However, even within a loyalty program that ispart of a general business practice, a sales promotion can be offered such as special short-term offerthat lowers the number of points needed to acquire a free product.

Samples and Free Trials

Enticing members of a target market to try a product is often easy when the trial comes at little or nocost to the customer. The use of samples and free trials may be the oldest of all sales promotiontechniques dating back to when society advanced from a culture of self-subsistence to a culture oftrade.

Sampling and free trials give customers the opportunity to experience products, often in smallquantities or for a short duration, without purchasing the product. Today, these methods are used inalmost all industries and are especially useful for getting customers to try a product for the first time.


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Free Product

Some promotional methods offer free products but with the condition that a purchase be made. Thefree product may be in the form of additional quantities of the same purchased product (e.g., buy one,get one free) or specialty packages (e.g., value pack) that offer more quantity for the same price as

regular packaging.Premiums

Another form of sales promotion involving free merchandise is premium or give-away items.Premiums differ from samples and free product in that these often do not consist of the actual product,though there is often some connection. For example, a cellphone manufacturer may offer access to freedownloadable ringtones for those purchasing a cellphone.

Contests and Sweepstakes

Consumers are often attracted to promotions where the potential value obtained is very high. In thesepromotions only a few lucky consumers receive the value offered in the promotion. Two types ofpromotions that offer high value are contests and sweepstakes.

Contests are special promotions awarding value to winners based on skills they demonstrate comparedto others. For instance, a baking company may offer free vacations to winners of a baking contest.Contest award winners are often determined by a panel of judges.

Sweepstakes or drawings are not skill based but rather based on luck. Winners are determined byrandom selection. In some cases the chances of winning may be higher for those who make a purchaseif entry into the sweepstake occurs automatically when a purchase is made. But in most cases, anyoneis free to enter without the requirement to make a purchase.

A sub-set of both contests and sweepstakes are games, which come in a variety of formats such asscratch-off cards and collection of game pieces. Unlike contests and sweepstakes, which may notrequire purchase, to participate in a game customers may be required to make a purchase. In the UnitedStates and other countries, where eligibility is based on purchase, games may be subjected to rigid legalcontrols and may actually fall under that category of lotteries, which are tightly controlled.

Demonstrations

Many products benefit from customers being shown how products are used through a demonstration.Whether the demonstration is experienced in-person or via video form, such as over the Internet, thispromotional technique can produce highly effective results. Unfortunately, demonstrations are veryexpensive to produce. Costs involved in demonstrations include paying for the expense of thedemonstrator, which can be high if the demonstrator is well-known (e.g., nationally known chef), andalso paying for the space where the demonstration is given.


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Personal Appearances

An in-person appearance by someone of interest to the target market, such as an author, sports figure orcelebrity, is another form of sales promotion capable of generating customer traffic to a physicallocation. However, as with demonstrations, personal appearance promotion can be expensive since the

marketer normally must pay a fee for the person to appear.

Trade Sales Promotions

As note in the Promotion Decisions Tutorial, certain promotions can help push a product through thechannel by encouraging channel members to purchase and also promote the product to their customers.For instance, a trade promotion aimed at retailers may encourage retailers to instruct their employees topromote a marketers brand over competitors offerings. With thousands of products competing forlimited shelf space, spending on trade promotion is nearly equal that spent on consumer promotions.

Many sales promotions aimed at building relationships with channel partners follow similar designs asthose directed to consumers including promotional pricing, contests and free product. In addition tothese, several other promotional approaches are specifically designed to appeal to trade partners. Theseapproaches include:

1. Point-of-Purchase Displays2. Advertising Support Programs3. Short Term Allowances4. Sales Incentives or Push Money5. Promotional Products6. Trade Shows

Below is a discussion of each approach.

Point-of-Purchase Displays

Point of purchase (POP) displays are specially designed materials intended for placement in retailstores. These displays allow products to be prominently presented, often in high traffic areas, andthereby increase the probability the product will standout. POP displays come in many styles, thoughthe most popular are ones allowing a product to stand alone, such as in the middle of a store aisle or sitat the end of an aisle (i.e., end-cap) where it will be exposed to heavy customer traffic.

For channel partners, POP displays can result in significant sales increases compared to sales levels in anormal shelf position. Also, many marketers will lower the per-unit cost of products in the POPdisplay as an incentive for retailers to agree to include the display in their stores.Advertising Support Programs

In addition to offering promotional support in the form of physical displays, marketers can attractchannel members interest by offering financial assistance in the form of advertising money. These


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funds are often directed to retailers who then include the companys products in their advertising. Incertain cases the marketer will offer to pay the entire cost of advertising, but more often, the marketeroffers partial support known as co-op advertising funds.

Short Term Trade Allowances

This promotion offers channel partners price breaks for agreeing to stock the product. In most casesthe allowance is not only given as encouragement to purchase the product but also as an inducement topromote the product in other ways such as by offering attractive shelf space or store location,highlighting the product in company-produced advertising or website display, or by agreeing to havethe retailers sales personnel talk-up the product to customers.

Allowances can be in the form price reductions (a.k.a. off-invoice promotion) and buy-back guaranteesif the product does not sell in certain period of time.Sales Incentives or Push Money

Since sales promotions are intended to stimulate activity that leads to meeting promotional objectives,it makes sense that these can also apply to those in a channel members organization who also affectsales. Thus, a marketer may offer sales promotions to their resellers sales force and customer servicestaff where they are used as incentives to help sell more of the marketers product. Sometimes calledpush money, these promotions typically offer employees cash or prizes, such as trips, for those thatmeet sales requirements.

Promotional Products

Among the most widely used methods of sales promotions is the promotional product; products labeledwith the brand or company name that serve as reminders of the actual product. For instance,companies often hand out free calendars, coffee cups and pens that contain the product logo.Trade Shows

One final type of trade promotion is the industry trade show (a.k.a. exhibitions, conventions). Tradeshows are organized events that bring both industry buyers and sellers together in one central location.Spending on trade shows is one of the highest of all sales promotions. In fact, the PromotionMarketing Association estimates that over (US) $20 billion is spent annually by marketers toparticipate in trade shows.

Marketers are attracted to trade shows since these offer the opportunity to reach a large number ofpotential buyers in one convenient setting. At these events most sellers attempt to capture the attentionof buyers by setting up a display area to present their product offerings and meet with potentialcustomers. These displays can range from a single table covering a small area to erecting speciallybuilt display booths that dominate the trade show floor.


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Business-to-Business Sales Promotions

The use of sales promotion is not limited to consumer products marketing. In business-to-businessmarkets sales promotions are also used as a means of moving customers to action. However, thepromotional choices available to the B-to-B marketer are not as extensive as those found in the

consumer or trade markets. For example, most B-to-B marketers do not use coupons as a vehicle forsales promotion with the exception of companies that sell to both consumer and business customers(e.g., products sold through office supply retailers). Rather, the techniques more likely to be utilizedinclude:

* price-reductions* free product* trade-in* promotional products* trade shows

Of the promotions listed, trade shows are by far the mostly widely used sales promotion for B-to-Bmarketers.

Trends in Sales Promotion

Marketers who employ sales promotion as a key component in their promotional strategy should beaware of how the climate for these types of promotions is changing. The important trends in salespromotion include:Customers Expectations

The onslaught of sales promotion activity over the last several decades has eroded the value of theshort-term requirement to act on sales promotions. Many customers are conditioned to expect apromotion at the time of purchase otherwise they may withhold or even alter their purchase if apromotion is not present. For instance, food shoppers are inundated on a weekly basis with such a widevariety of sales promotions that their loyalty to certain products has been replaced by their loyalty tocurrent value items (i.e., products with a sales promotion). For marketers the challenge is to balancethe advantages short-term promotions offer versus the potential to erode loyalty to the product.

Electronic Delivery

Sales promotions are delivered to customers in many ways such as by mail, in-person or within printmedia. However, the Internet and mobile technologies, such as cellphones, present marketers with anumber of new delivery options. For examples, the combination of mobile devices and geographicpositioning technology will soon permit marketers to target promotions to a customers physicallocation. This will allow retailers and other businesses to issue sales promotions, such as electroniccoupons, to a customers mobile device when they are near the location where the coupon can be used.Tracking


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As we discussed in our coverage of advertising, tracking customers response to marketerspromotional activity is critical for measuring success of an advertisement. In sales promotion, trackingis also used. For instance, grocery retailers, whose customers are in possession of loyalty cards, havethe ability to match customer sales data to coupon use. This information can then be sold to couponmarketers who may use the information to get a better picture of the buying patterns of those

responding to the coupon.

Internet Communication

For many years consumers typically became aware of sales promotions in passive ways. That is, mostcustomers obtained promotions not through an active search but by being a recipient of a marketerspromotion activity (e.g., received coupons in the mail). The Internet is changing how customers obtainpromotions. In addition to websites that offer access to coupons, there are a large number ofcommunity forum sites where members share details about how to obtain good deals which ofteninclude information on how or where to find a sales promotion. Monitoring these sites may offermarketers insight into how customers feel about certain promotions and may even suggest ideas forfuture sales promotions.Clutter and Need for Creativity

In the same way an advertisement competes with other ads for customers attention, so to do salespromotions. This is particularly an issue with inserted coupon promotions that may be included inmailing or printed media along with numerous other offerings. The challenge facing marketers is tofind creative ways to separate their promotions from those offered by their competitors.


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References

Brassington, F.; Pettitt, F. (2003), Principles of marketing, 3rd edition, Pearson Education Limited,Harlow

Clow, Kenneth E. & Baack, Donald (2004). Integrated Advertising, Promotion, and MarketingCommunications. New Jersey: Pearson Prentice Hall.

Yeshin, T. (2006), Sales promotion, Thomson Learning, London

http://www.knowthis.com

http://www.marketingteacher.com


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TURKCELL COMMUNICATION COMPANY

Company info:

GSM network started in Turkey with Turkcell in February 1994. Then, it has increased the variety ofits services based on mobile audio and data communication, number of subscribers. In 2008, Turkcellhad 37 million users. With this, Turkcell is a leader of Turkeys GSM network sector and it is also thethird biggest GSM operator in Europe.

Turkcell is the first Turkish company to be listed on the New York Stock Exchange (NYSE), where itsshares have been traded since 2000 along with trading on the IMKB.

Turkcell has investments in foreign countries as well. Turkcell's participations in Azerbaijan,

Kazakhstan, Georgia and Moldova through Fintur.

Turkcell, with its wide coverage area and its large variety of services abroad is able to provide its

subscribers with mobile communication services in Turkey and around the world. With its investments,Turkcell now covers all the settlements in Turkey that have a population of more than 3000. In 2009,

Turkcell has signed contracts with 609 operators in 202 countries, ranking it among the top operators in

the world in terms of provision of international services. Turkcell also ranks among the top operators in

terms of GPRS roaming, with contracts signed with 363 operators from 144 countries.

Their vision is easing and enriching the lives of our customers with communication and technology

solutions.

Their strategic priorities are maintaining market and technological leadership while retaining ourcompetitive advantage, increasing customers' satisfaction and loyalty through improving customers'

experience, maintaining growth through new investments and business models.

Products

Turkcell Services:

Short message MaxiMeSaj (MMS) Interactive Voice Response (IVR) System WAP


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Service Categories (According to the Benefit Provided to the Customer):

Chat & Messaging Applications Logo & Melody Applications Game & Contest Applications Corporate Applications

Turkcell has offered services like "TurkcellEDGE", "Turkcell BlackBerry", "TurkcellConnect" and

"TurkcellE-Postac" to its customers. Among other services of Turkcell, that aim to make the lives ofits customers easier that can be cited as examples are Turkcell Mobil deme which enables the

customers to use their credit cards with their mobile phones when using the Turkcell infrastructure, and

CepteCevap which gives answers to questions sent by SMS.

Packets Of Turkcell

Individual

Gntrkcll:

Gntrkcll is a youth club for young people around Turkey. Turkcell launched Turkcells youth club:

gnctrkcll, by taking into account the life styles and needs of young people and bringing together the

subscribers that have similar lifestyles and needs. It is not a tariff or campaign, it is a club that presentssurprising offers, special campaigns and opportunities, various facilities and meets youth popular

brands. Every Turkcell and Hazrkart members can join this club without an obligation of being in anytariff.

Hazrkart:

Hazr Kart (literallyInstant Card) is launched for subscribers with lower spending levels, or whopreferred to have more incoming than outgoing calls. Hazr Kart subscribers have access to all

Turkcell's global GSM services.

Tcell:

Tcell is a pack for companies and individuals. It creates and advantage in callings between company

workers and also with other Tcell members. Corporate lines are automatically put in Tcell pack andindividuals can join this pack by cancelling their other members of gntrkcll and kampuscell.


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Turkcell Platinum:

Turkcell Platinum is for differen segment, for privileged customers. The advantages are asistantservices, different pricing and private customer agent.

Turkcell Gold:

It is related with Turkcell Platinum. We can say that Turkcell Gold is a lower version of platinum pack.It represents special services too.

Corporate

Turkcell has also corporate actions for companies. Tcell for companies and Mobil Ofis are the most

populer ones. Turkcell also makes some campaigns and sales promotions for companies to increase the

number of using.

In Social Responsibility, Turkcell has also supported many social projects so far that it believes willadd value to the society from education, technology and sports to art andculture art. To give anexample; Turkcell has been conducting Kardelenler (Snowdrops) projects, which is one of the biggestsocial responsibility projects in the world. Under the project, every year many school-age girls whose

families cannot afford to send them to school, are granted a scholarship.

And alsoRunning Towards the Future projectallows any student in the 7-17 age groups to do sportswithout any preconditions imposed on them.

In the technology sector, Turkcell has been contributing to the development of the IT andtelecommunication industries in our country with the support it provides to CeBIT IT Eurasia fair. Thisorganization is also sponsored by Turkcell for the past ten years.


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Market Share

There are currently three GSM operators in Turkey: Turkcell, Vodafone, and Avea. As of the end ofDecember 2008, there were approximately 66 million GSM lines and the mobile line penetration rate inTurkey was approximately 92%, according to the operators' announcements.

Turkcells competitors are Vodafone with a market share of 25% and Avea with a market share of19%.

Market Share *

* As of the end of 2008,based on operators'announcements.

Financial Situation

Turkcell's shareholder structure is as follows: 51% is held by Turkcell Holding A.., 4.15% byukurova Holding A.., 13.07% by Sonera Holding B.V., 2.32% by MV Holding A.., and the freefloat is 29.38%. ukurova Group controls the company despite holding only 18% of the share capital,

due to a complicated shareholding/voting structure.


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References

http://www.turkcell.com.tr

http://www.gsmworld.com/
http://www.turkcell.com.tr/http://www.gsmworld.com/http://www.turkcell.com.tr/http://www.gsmworld.com/

sales promotion and turkcell

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