Marketing bán hàng - Chapter 16: Sales promotion

Chapter 16Sales PromotionAn extra incentive to buyA tool to speed up salesAn extra incentive to buyA tool to speed up salesTargeted to different partiesSales Promotion“A direct inducement that offers an extra value or incentive for the product to the sales force, distributors, or the ultimate consumer with the primary objective of creating an immediate sale.”Types of Sales Promotion Activities3Reasons for the Increase in Sales PromotionGrowing power of retailers and declining brand loyaltyIncreased promotional sensitivityBrand proliferationFragmentation of the consumer marketShort-term focus and increased accountabilityCompetition and clutterGrowth of digital marketing4Consumer Franchise-Building versus Nonfranchise-Building PromotionsConsumer franchise-building (CFB) promotionsCommunicate distinctive brand attributes and contribute to the development and reinforcement of brand identityBuild long-term brand preference Help achieve full-price purchases that are not dependent on promotional offersCapable of converting consumers to loyal customersNonfranchise-building (non-FB) promotionsAccelerate the purchase decision process and generate an immediate increase in salesDo not contribute to the building of brand identity and imageMerely borrow customers from other brands5SamplingProducts are of relatively low unit value, so samples don’t cost muchProducts are divisible and can be broken into small sizes that reflect the products features and benefitsPurchase cycle is relatively short so the consumer can soon purchase againSampling WorksBest WhenSampling MethodsDoor-to-door samplingSampling through the mailIn-store samplingOn-package samplingEvent samplingSampling through magazines and newspapersSample request formsSampling through the internet and social media7Advantages and Limitations of CouponingAdvantagesAppeals to price-sensitive customersDoes not require retailers’ cooperationReduces consumer’s perceived risk associated with trial of a new brandEncourages repeat purchaseHelps coax users to trade up to more expensive brandsLimitationsEstimating how many consumers will use a coupon and when is difficultLess effective for inducing initial product trial in a short periodConsumers already using the brand cannot be prevented from using the couponsHave low redemption rates and high costsCould result in misredemptions8Types of PremiumFree premiums: Small gifts or merchandise:Included in the product packageSent to consumers who mail in a request along with a proof of purchaseSelf-liquidating premiums: Require the consumer to pay:Some or all of the cost of the premiumHandling and mailing costs9Contests and SweepstakesSweepstakesContestPromotion where winners aredetermined purely by chanceWinners chosen by random selection from pool of entries or generation of a number to match those held by game entrantsConsumers compete for prizes or money on the basis of skills or abilityWinners determined by judging entriesor ascertaining which entry is closestto predetermined criteriaCannot require proof of purchaseas a condition for entryAdvantages & Limitations of Refunds and RebatesAdvantagesResponsive consumersCreates new usersEncourage repeat purchasesPerceived price reductionLimitationsToo much effort to obtain savingsPerception of rebates to sell products that are not selling wellOther incentives are more effective for small refundsDependence leads to delayed purchases11Advantages and Limitations of Bonus Packs AdvantagesDirect way to provide extra valueHave a strong impact on the purchase decision at the time of purchaseEffective defensive maneuver against competitor’s promotionMay result in larger purchase orders and favorable display space in storesLimitationsRequire additional shelf space without providing extra profit margins for retailersAppeal primarily only to current users and promotion-sensitive consumers12Advantages and Limitations of Price-off DealsAdvantages Ensure discounts reach the consumersPresent a readily apparent value to shoppersEncourage consumers to purchase larger quantitiesLimitationsCan create pricing and inventory problemsAppeal primarily to regular users and not new usersMust adhere to regulations set by the Federal Trade Commission13Event Marketing versus Event sponsorshipEvent marketingCompany or brand is linked to an event, or a themed activity is developed to:Create experiences for consumers Promote a product or serviceEvent sponsorshipCompany develops sponsorship relations with an event and provides financial support in return for:Right to display a brand name, logo, or advertising messageBeing identified as a supporter of the event14Figure 16.5 - Consumer-Oriented Sales Promotion Tools for Various Marketing Objectives15Types of Trade Oriented PromotionsBuyingPromotionalSlottingPOP displaysSales trainingTrade showsContests and incentivesTrade allowancesCo-op AdvertisingTypesTypes of Cooperative AdvertisingHorizontal cooperative advertisingSponsored by a group of retailers providing products or services to the marketIngredient-sponsored cooperative advertisingSupported by raw materials manufacturersEstablishes end products that include the company’s materials and/or ingredientsVertical cooperative advertisingManufacturer pays for a portion of the advertising a retailer runs to promote the manufacturer’s product17Figure 16.8 - The Sales Promotion Trap18