Sales Promotion Chapters 18, 19 by tkb65554


									Sales Promotion
Chapters 18, 19
             Sales Promotion

   Marketing communication tool that offers
    sales-related incentives to generate a
    specific, measurable action or response
    for a product or service.
           Sales Promotion

• Acts as a marketing communication tool

• Offers sales-related incentives

• Generates response or action

• Produces measurable results

• Changes the accepted price-value relationship
                     Sales Promotion
STRENGTHS                                WEAKNESSES
• Gives an extra incentive to act        • Adds clutter
• Changes the price/value relationship   • Can set false retail price
• Gives sense of immediacy to purchase   • Some consumers won’t buy
                                         unless offered a price deal
• Adds excitement
                                         • Leads to forward buying by trade
• Stimulates trial
• Stimulates continuity of purchase or
                                         • Fraudulent redemption of
support, repeat purchases
                                         coupons and theft of premiums
• Increases purchase frequency and or
                                         • Can be difficult to get trade
• Promotes reminder merchandise
                                         • Can undercut brand images,
• Motivates trade support                create brand insensitivity
• Builds databases
Sales Promotion Compared to Other
        Promotion Mix Tools
                   Sales     Ad-       Public    Response Personal
                   Promotion vertising Relations (Interactive) Selling
Time                short      long        long        short      both
Frame               term       term        term        term
Primary             both       emotional   emotional   rational   rational

Primary             sales      image/      goodwill    sales      sales
Objective                      brand                              relation-
                               position                           ships
Contribution        high       moderate    low         high       high
to Profitability
        Push and Pull Strategies
PUSH:                             PULL:
• Directs Marketing to            • Directs Marketing
Resellers                         to End-Users

           PUSH                             PULL

Contributions to marketing communication
  strategy -- 1) Introducing new product

  Reduced price
  In-store sampling
  Special tie-in
  Coupons
  Mail samples
  Offer reduced prices in stores
  Contests
        Introducing new product
   Trade Promotions
     Trade advertising
     Trade sales promotion techniques
      – Price discounts
      – Point-of-purchase (PoP) displays
      – Advertising allowances
     Repeat   purchase promotions
      – Coupons
      – Rebates
      – Other rewards
    Contribution -- Brand Building

   Techniques to enhance brand image
     Tie-ins   (FOR EXAMPLE)
   Must be part of a strategy to build brand
    trial and familiarity
       Sales promotion strategy -- Stimulate consumer to
         act, motivate sales force, gain cooperation of

   Goals of proactive, long-    Goals of reactive
     range objectives             (normally negative or
    Create additional            short-term situation
     revenue or market           Match competition
     share                       Move inventory
    Enlarge target market       Generate cash
    Create positive             Perhaps go out of
     experience                   business
    Enhance product value
     and brand equity

           Sales Promotion Mix

        Which to use
        How to combine
        How to deliver
            Separate   or overlay

         Sales Promotion Objectives
   CONSUMER                                TRADE
   • Prompt trial by new users             • Introduce products to new
                                           distribution areas
   • Introduce new or improved products
                                           • Reduce selling costs
   • Stimulate repeated product use
                                           • Improve working habits
   • Encourage more frequent purchase or
   multiple purchases                      • Offset competitive promotions

   • Keep customers by providing an        • Increase sales volume
   implied reward
                                           • Control inventory
   • Reinforce advertising or personal
                                           • Stimulate in-store support
                                           • Create a high level of excitement
   • Stimulate trade support
                                           among those responsible for
                                           product sale

        Trade Sales Promotion -- Resellers

       Dealer Contests         Trade Deals
       Trade Coupons               Buying allowances
                                      – slotting allowance
       Dealer Loaders                – free goods allowance
           buying loaders          Advertising and
           display loader           cooperative
                                    Display allowances

   Trade Sales Promotion -- Sales Force

       Supportive programs
         Sales meetings
         Sales kits

       Motivational programs
         contests
         honorsclubs
         push money

 Consumer Sales Promotion
• Price Deals
     •Price-pack deals
       •Bonus packs
       •Banded pack
   • Coupons
   • Refunds and Rebates
       Consumer Promotions
• Contests, Sweepstakes, Games
• Premiums
   Direct   premiums
     – Store premiums
     – In-packs
     – On-packs
     – Container premiums
   Mail premiums
   Self-liquidator
   Continuity-coupon plan
   Free-in-the-mail premium
     Consumer Promotions

• Samples
• Continuity Programs
     Frequent   flyer programs

   Specialties, event sponsorship,

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