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Chapter 17

Chapter 17. Sales Promotion, Point-of-Purchase Advertising, and Support Media. PPT 17- 1. © 2009 South-Western, a part of Cengage Learning. Part Five: Integrated Brand Promotion.

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Chapter 17

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  1. Chapter 17 Sales Promotion, Point-of-Purchase Advertising, and Support Media PPT 17-1 © 2009 South-Western, a part of Cengage Learning

  2. 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 PPT 17-2

  3. 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 PPT 17- 3

  4. Sales Promotion Examples Coupons Brand placements Contests Gift Cards Allowances Sweepstakes Point of Purchase Displays Incentives Sampling Price-off deals Premiums Loyalty Programs Trade Shows PPT 17- 4

  5. Sales Promotion vs. Advertising • Short term demand vs. long term demand • Encourages brand switching vs. brand loyalty • Induces trial use vs. encourage repeat purchase • Promotes price vs. image • Immediate results vs. long term effects • Measurable results vs. difficult to measure PPT 17- 5

  6. Importance of Sales Promotion • $300 billion in 2008 • Growth rate: 4-8 percent • Reasons for growth: • Demand for accountability • Short-term orientation • Consumer response to promotions • Proliferation of brands • Increased power of retailers • Media clutter PPT 17- 6

  7. Objectives for Consumer-Market 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 PPT 17- 7

  8. Consumer-Market Sales Promotion Techniques • 1. Coupons 2. Price-off deals • 3. Premiums 4. Contests/sweeps • 5. Samples & trials 6. Phone gift cards • Brand placements 8. Rebates • Frequency programs • Event sponsorship PPT 17- 8

  9. 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 PPT 17- 9

  10. Ad in Context Example Coupons are the most widely used form of consumer sales promotion. PPT 17-10

  11. 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 PPT 17- 11

  12. 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 PPT 17- 12

  13. 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 PPT 17- 13

  14. Ad in Context Example Premiums attract attention to a brand and offer the consumer something for free. PPT 17- 14

  15. 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 PPT 17- 15

  16. 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) – Newspaper • Door-to-door – On-package • Mail – Mobile (on-site) • Trial offers • Used for more expensive items • Consumer tries product for a fixed time PPT 17- 16

  17. 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 PPT 17- 17

  18. 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 PPT 17- 18

  19. Frequency Programs • Also known as continuity programs • Offers customers discounts or free products for repeat patronage • Common in airline, hotel, and restaurant businesses PPT 17- 19

  20. 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 PPT 17- 20

  21. Trade-Market Sales Promotion Techniques • Incentives: Push money • Allowances: Merchandise allowances, slotting fees, bill- back allowances, off-invoice allowances • Sales Training Programs • Cooperative (Co-Op) Advertising PPT 17- 21

  22. Business Market Sales Promotion Techniques • Trade Shows • Business gifts • Premiums and advertising specialties • Trial offers • Frequency programs PPT 17- 22

  23. Ad in Context Example Trial offers are very effective in the business market. Why? PPT 17- 23

  24. Risks of Sales Promotion • Create a price orientation • Borrow from future sales • Alienate loyal customers • Time and expense • Legal considerations PPT 17- 24

  25. 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 • 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. PPT 17- 25

  26. 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. PPT 17- 26

  27. Support Media • Purpose: To reinforce or extend a message being delivered through other media • Signs, billboards, posters • Transit • Aerial • Specialty • Directory PPT 17-27

  28. Outdoor Signage and Billboards • Advantages • Wide local exposure • Captivating • Around-the-clock exposure • Address an immediate need or desire • Disadvantages • Message limits • Location affects impact • Relatively expensive • Criticized by environmental groups PPT 17-28

  29. Transit Ads • Transit Ads • Urban environments • Demographic segmentation • Timely to purchase • Build brand awareness PPT 17-29

  30. Ad in Context Example Transit ads can reach a target audience in well defined geographic areas. PPT 17-30

  31. Aerial Ads • Aerial Ads • Blimps increasingly common • Common at sporting events • Skies are getting crowded! • Networks are in control PPT 17-31

  32. Directory Advertising • Advantages • High acceptance • High availability • Final link to purchase • Disadvantages • Too many directories • Long lead times • Limited creativity • New: CD-ROM and Web-based directories PPT 17-32

  33. Ad in Context Example Web based directories offer convenience and speed. PPT 17-33

  34. 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” PPT 17-34

  35. Ad in Context Example Packaging highlights the brand name, quality and image. PPT 17-35

  36. 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 PPT 17-36

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