Transcript VER

Chapter 17
Sales Promotion, Point-of-Purchase
Advertising, and Support Media
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© 2009 South-Western, a part of Cengage Learning
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Part Five: Integrated Brand
Promotion
 We have considered the Process, Planning,
Preparation, and Placement of advertising and
IBP in the first Four Parts of the book
 Now we take a detailed look at the full range of
IBP tools available to the advertiser
 Each of these IBP tools has a unique capability
to influence audience perception of a brand
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Sales Promotion--Defined
“Using incentives to create a
perception of greater brand value”
 Consumer Market sales promotion
– Induce household consumers to purchase a firm’s
brand
 Trade-Market sales promotion
– Motivate distributors, wholesalers, and retailers to stock
and feature a brand
 Business Market sales promotion
– Cultivate buyers in large corporations who make
purchase decisions
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Sales Promotion Examples
Coupons
Brand placements
Contests
Gift Cards
Allowances
Sweepstakes
Incentives
Sampling
Price-off deals
Premiums
Loyalty Programs
Trade Shows
Point of Purchase Displays
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Sales Promotion vs.
Advertising
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Short term demand vs. long term demand
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Encourages brand switching vs. brand loyalty
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Induces trial use vs. encourage repeat purchase
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Promotes price vs. image
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Immediate results vs. long term effects
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Measurable results vs. difficult to measure
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Importance of Sales
Promotion
 $300 billion in 2008
 Growth rate: 4-8 percent
 Reasons for growth:
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Demand for accountability
Short-term orientation
Consumer response to promotions
Proliferation of brands
Increased power of retailers
Media clutter
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Objectives for ConsumerMarket Sales Promotion
1. Stimulate trial purchase
2. Stimulate repeat purchases
3. Stimulate larger purchases
4. Introduce a new brand
5. Combat or disrupt competitors
6. Contribute to IBP
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Consumer-Market Sales
Promotion Techniques
1. Coupons
2. Price-off deals
3. Premiums
4. Contests/sweeps
5. Samples & trials
6. Phone gift cards
7. Brand placements 8. Rebates
9. Frequency programs
10.Event sponsorship
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Coupons
 Entitles a buyer to a price reduction
for a product or service
 Advantages
– Give a discount to price sensitive consumer while
selling product at full price to others
– Induce brand switching
– Timing and distribution can be controlled
– Stimulates repeat purchases
– Gets regular users to trade up within a brand
array
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Ad in Context Example
Coupons are
the most
widely used
form of
consumer
sales
promotion.
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Coupons
 Disadvantages
– Time of redemption cannot be
controlled
– No way to prevent current customers
from redeeming coupons
– Coupon programs require costly
administration
– Fraud is a serious, chronic problem
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Price-Off Deals
 Offers consumer reduced price at
point of purchase through specially
marked packages
 Advantages
– Controllable by manufacturer
– Can effect positive price comparisons
– Consumers believe it increases value
of a known brand
 Disadvantage
– Retailers believe it creates inventory
and pricing problems
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Premiums and Advertising
Specialties
 Premiums: free or at a reduced
price with another purchase
 Free premiums provide item at no
cost
 Self-liquidating premiums require
consumers to pay most of the
cost of the item
 Advertising specialties:
– A message placed on a free, useful
item
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Ad in Context Example
Premiums attract
attention to a brand and
offer the consumer
something for free.
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Contests and Sweepstakes
 Contests: consumers compete for prizes
based on skill or ability.
 Sweepstakes: winners picked by chance
 Both create excitement and interest
 But . . .
– Legal and regulatory requirements are
complex
– Consumers may focus on the game rather
than the brand
– Difficult to get an IBP message across in a
game
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Samples and Trial Offers
 Sampling: Giving consumer an
opportunity to use a brand on a trial basis
with little or no risk
 Types of sampling
– In-store (Costco)
– Door-to-door
– Mail
– Newspaper
– On-package
– Mobile (on-site)
 Trial offers
– Used for more expensive items
– Consumer tries product for a fixed time
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Phone and Gift Cards
 Manufacturers offer either for free
or for purchase debit cards
– with phone time
– or preset spending limits
 Examples include offers from
Starbucks, Barnes & Noble, and
The Gap
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Rebates
 Money back offer requiring the buyer to
mail a request for money back from the
manufacturer
 Often tied to multiple purchases
 Many consumers fail to bother sending
in the rebate request form
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Frequency Programs
 Also known as continuity
programs
 Offers customers discounts or
free products for repeat
patronage
 Common in airline, hotel, and
restaurant businesses
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Objectives for Promotions in
the Trade Market
 Objectives: Uses a “push” strategy:
Push the product into the
distribution channel to the
consumer:
– Obtain initial distribution
– Increase order size
– Encourage cooperation with
consumer market sales promotions
– Increase store traffic
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Trade-Market Sales
Promotion Techniques
 Incentives: Push money
 Allowances: Merchandise allowances, slotting fees, billback allowances, off-invoice allowances
 Sales Training Programs
 Cooperative (Co-Op) Advertising
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Business Market Sales
Promotion Techniques
 Trade Shows
 Business gifts
 Premiums and advertising specialties
 Trial offers
 Frequency programs
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Ad in Context Example
Trial offers are very
effective in the business
market. Why?
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Risks of Sales Promotion
 Create a price orientation
 Borrow from future sales
 Alienate loyal customers
 Time and expense
 Legal considerations
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Point of Purchase (P-O-P)
Advertising
 Definition
– Materials used in the retail setting to attract shoppers’
attention to a brand, to convey primary product benefits, or
highlight pricing information.
– Displays may feature “price-off” deals as well.
 Objectives for Point-of-Purchase Advertising
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Draw consumers’ attention to a brand in the retail setting.
Maintain purchase loyalty among brand loyal users.
Stimulate increased or varied usage of the brand.
Stimulate trial use by users of competitive brands.
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P-O-P Advertising and the
Trade and Business Markets
 Product displays and information sheets encourage
retailers to support one distributor or manufacturer’s
brand over another.
 P-O-P promotions can help win precious shelf space
and exposure in a retail setting.
 A P-O-P display should be designed to draw attention
to a brand, increase turnover, and possibly distribute
coupons or sweepstakes entry forms.
 To combat losing business to online shopping,
retailers are trying to enliven the retail environment,
and point-of-purchase displays are one strategy.
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Support Media
 Purpose: To reinforce or extend a message
being delivered through other media
– Signs, billboards, posters
– Transit
– Aerial
– Specialty
– Directory
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Outdoor Signage and
Billboards
 Advantages
 Disadvantages
– Wide local
exposure
– Captivating
– Around-the-clock
exposure
– Address an
immediate need or
desire
– Message limits
– Location affects
impact
– Relatively expensive
– Criticized by
environmental
groups
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Transit Ads
 Transit Ads
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Urban environments
Demographic segmentation
Timely to purchase
Build brand awareness
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Ad in Context Example
Transit ads
can reach a
target
audience in
well defined
geographic
areas.
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Aerial Ads
 Aerial Ads
– Blimps increasingly
common
– Common at sporting
events
– Skies are getting
crowded!
– Networks are in
control
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Directory Advertising
 Advantages
– High acceptance
– High availability
– Final link to
purchase
 Disadvantages
– Too many
directories
– Long lead times
– Limited creativity
 New: CD-ROM and Webbased directories
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Ad in Context Example
Web based
directories
offer
convenience
and speed.
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Packaging
 Promotional Benefits of Packaging to the
Advertiser:
– The package carries the brand name and logo
– The package can communicate “value”
– The package can communicate “image” and
“quality”
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Ad in Context Example
Packaging
highlights
the brand
name,
quality
and image.
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When Support Media are
More than Support Media
 Guerrilla Marketing—”Stunt” promotions
 Viral campaigns—Using influencers
(Chapter 20)
 Special Events—Creating visibility and
“affinity” for a brand among a highly select
target group
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