AC 222 Sales Promotion – Flashcards

1. Awareness 2. Interest 3. Comprehension 4. Conviction 5. Action/Purpose

planning, executing, evaluating, and controlling the use of the promotional mix to effectively communicate with target audiences.

every opportunity a customer has to see or hear about a company and/or brands or have an encounter or experience with it.

Is a good way to give consumers a short term incentive to purchase a product which in turn increases "short-term" sales and profits. - SP produces RESULTS (faster and measurable) - It's relatively easy and inexpensive to implement

- Many SP tactics are NOT "effective brand building tools" - Can result in a "less" positive attitudes toward the product - Can have lower effect on profitability - Can require substantial implementation costs - Marketing managers become oriented to short term goals

marketing and communication activities that changes the behavior and alter the price/value relationship of a product or service perceived by the target consumer thereby: - Generating immediate sales and - Altering long term brand value

People who buy the "right" product most or all of the time Desired Behavior: - Reinforce behavior - Prevent your customer from going over to your competitor - Increase consumption - Persuade them to purchase additional product (can vs. 6 pack) - Stockpiling or pantry loading before holiday - Less likely to buy a competitive brand in the near future i.e. 30 pks etc. - Change purchase timing

Loyal to the "other" brand - People who buy a competitive product most or all of the time Desired Behavior: - Breaks loyalty - Persuade to switch Intense Competitive loyal = believe their brand is the "best" - Very difficult to convert - Effective sampling

- People who buy a variety of product in the category - Buy a variety of brands within a category - Less committed - Therefore easier to win over with sale promotions than competitive users - Availability--need to be on the shelve (trade deals) People who buy a variety in a category. Desired Behavior: - Persuade to buy "your" brand more often - Value "buyers:''chose what they think is the best deal at the time - Occasion usage--buying for someone else - Variety--like change - Variety packs, cereal

People who consistently buy the lowest price brand in the "category"

- People who DON'T use any product in the category. - Price Problems-- Find it too Expensive - Yacht - Lack of need - Lawn mower - Value--don't think it's worth it - Limo vs. taxi - Subways vs. walking Desired Behavior: - Create awareness of the category first and then the product - Persuade that product is worth buying (benefits) - Red Bull

1. Grow Sale Volume - Increase overall sales growth by 25% - Increase sales from 1000 cases to 125 cases 2. Profit - Grow profit from $100m t0 $105m - Increase profits by 5% 3. Grow Market Share - Increase from 50% to 60%

the health of the business. You want a bigger piece of it. Growth: - Steal from the competition. Get your competitive users to buy you. (Introduction stage) - Increase consumption against current (loyal) users (growth stage) - Attract new users (switchers, price buyers, non users) (maturity stage)

by far the most popular and relied upon form of consumer sales promotion.

1. Trade - Redeemable ONLY at a particular store or group of stores. 2. Manufacturer - Distributed by the maker product and redeemed at ANY retail store that carries the product.

Redeemable ONLY at a particular store or group of stores.

Distributed by the maker product and redeemed at ANY retail store that carries the product.

- Consumers have become increasingly price sensitive and less brand loyal (price/value relation) - Consumers may think they are getting a "deal" and therefore may buy more - Increase consumption - Provides a temporary price reduction - Encourage consumers to buy a NEW product or reconsider it again - Change behavior - Coupons ensure that price cuts are passed "directly" onto the consumer - Encourage consumers to demand the product at the store retailer - Force distribution - Coupons are more effective where the purchase is more frequent and low-involvement. - Low involvement = laundry detergent, household products (subject to more consumer switching) - Coupons allow manufacturers to have MORE control over the price consumers pay for their product

- Tend to be expensive and an inefficient way of marketing a product - Less than 3% of coupons are redeemed - Excessive couponing can erode brand loyalty! (cheapen the perceived value of the brand) - Coupons used by people who already are using the product - Lost profits

FSI Newspaper ROP Magazines Direct Mail On Pack Coupons In Pack Coupons Cross ruffs Electronic in store coupons Online Coupons

Most 'prefer' coupon deliver (over 80%) Newspapers

(Run of Press) -Printed INSIDE the newspaper rather than inserted into it. - Delivered on BFD (best food day)

On-Page Cupon Pop-up

Advantages: Selectivity targeted based on lifestyle: - Homeowners - Pet owners - Young mothers - Retired people - College students Can ensure one coupon per household Higher redemption rate (selective target group) More difficult for competitors to find out Disadvantages: Extremely high delivery cost - Purchase mailing list - Printing material and envelope - Postage and handling cost - POOR trade (retail) motivation

-Coupon ATTACHED to the package -Targeted to: loyals and switchers - Coupon for multi purchase - "save $2 when you buy 2 or more" - targeted usually for loayls

- Coupon included INSIDE the package - Loyal users (reward brand loyalty for future purchase) - Effective in frequently used categories - Coffee

Other products made by the same company to create interest and increase overall market share, profit and volume for the overall company.

At the cash register - coupon for future purchase - Retailers --history of your shopping experience In store dispenser

Misredemtion - when a retailer takes in a coupon but didn't sell the product

Bonus, in pack, on pack, near pack, specialty container Provides the consumer something extra at the "point of purchase"

- Gives the consumer more of the product for the same price. - When it's both the same product.

- Offers an items that is likely to be attractive to the targeted consumer. - When it's related products.

- Offered free or for a nominal charge with the product near the shelve or at retail. - Generate retail store traffic. - Reinforce brand consideration to repurchase

Provides a consumer with a premium item that can be used after the product is consumed

Rewarding relationship: - Designed to create and reward brand loyalty among consumers who might "switch" to another brand - Popular in categories where there is little product differentiation - Ex: hotels, airlines, car rentals - Frequent-flyer program - Cash rewards now the fastest growing form of consumer promotions

- Simply an offer by a manufacturer to return a certain amount of money to the consumer when a "particular product or groups of product are purchased" - There is no difference between a refund and a rebate. - Usually delivered "back" to the consumer through the mail - Often used on more expensive products - Effective on "brands" priced higher than the competition in order to induce trial WITHOUT a price cut.

Main benefit is to create awareness and "positive" feeling toward the brand

Solely by chance Characteristics/Advantages: - Attract many more entries than contest (10x more) - b/c it requires NO skill...anyone can enter (primary advantage) - Attract broader base of consumers - Offer larger prizes - Attract many "professional entries" - People who spend a great deal of time entering - May require proof of purchase

Demonstrates some sort of "skill" Characteristics/Advantages: - Can require a purchase therefore attract people who have some interest in the product - Requires a "skill"- most people will enter only a few times - Consumers feel they have some control over the outcome of the contest - Contests may attract more attention and interest than sweepstakes - Can make consumers feel they can help in solving marketing problems. (be a part of the process) - Better as targeting special - groups/ interests - People who like cooking, gardening, sports, etc. - Designed to encourage company, retail sales force to work harder to sell the product value - Best Motivation? - Mystery shopper - Consist of entry form, online (winner chosen at random)

- Create interest and attention - Attract media attention - Collect information on consumers - EX: Mailing address, email, etc. - Generate store traffic - EX: Fast food - Increase purchase - EX: under the cap promotion