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Consumer Promotions

Consumer Promotions. Chapter 10. Consumer Promotions Defined. An incentive or an enticement that encourages a consumer to either select or purchase a product. . Types of Consumer Promotions. Coupons Premiums Contests and sweepstakes Refunds and rebates Sampling Bonus packs Price-offs.

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Consumer Promotions

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  1. Consumer Promotions Chapter 10

  2. Consumer Promotions Defined • An incentive or an enticement that encourages a consumer to either select or purchase a product.

  3. Types of Consumer Promotions • Coupons • Premiums • Contests and sweepstakes • Refunds and rebates • Sampling • Bonus packs • Price-offs

  4. Consumers and Sales Promotions Targeted consumers are classified three ways: • Promotion prone consumers • Brand loyal consumers • Price sensitive consumers Take a look at question 8, on page 330. discuss with classmates seated close to you.

  5. F I G U R E 1 0 . 5 Types of Sampling • In-store distribution • Direct sampling • Response sampling • Cross-ruff sampling • Media sampling • Professional sampling • Selective sampling

  6. What’s Happening? http://www.eggs.ca/ContestsPromos/Default.aspx http://www.youtube.com/watch?v=5OfMb90v4qg http://money.cnn.com/2009/02/03/news/companies/dennys_breakfast.fortune/index.htm?postversion=2009020411 http://ca.youtube.com/watch?v=RYgKQ3_hWA4 http://ca.youtube.com/watch?v=uYIBAswqMEM http://ca.youtube.com/watch?v=CALvpp4nuJg

  7. Sampling • How effective would sampling be for the goods and services listed on the right? • How would you design a sampling program that would be effective, yet not too costly? • What type of consumers would you target for the sampling? • Fitness center • Ice cream • Dental service • Clothing manufacturer • Auto repair service • Office supply store

  8. Sampling • Most effective when used to introduce a new product or a new version of a product. • Primary purpose is to encourage trial use by a customer. • Sampling is a very effective IMC tool when used correctly. • The two key drawbacks to sampling programs are: • Cost • Customers discarding the sample without trying it.

  9. Types of Coupons • Instant redemption • Scanner-delivered • Cross-ruffing/Co-branding • Response offer • E-coupons • Bounce-back/return coupon

  10. A coupon accompanies this informational Gold Bond advertisement

  11. Types of Premiums • Free-in-the-mail • In- or on-package • Store or manufacturer • Self-liquidating

  12. Fast-food chains are well known for their in-store premiums.

  13. F I G U R E 1 0 . 4 Keys to Successful Premiums • Match the premium to the target market. • Carefully select the premiums (Avoid fads, try for exclusivity). • Pick a premium that reinforces the firm’s product and image. • Integrate the premium with other IMC tools (Especially advertising and POP displays). • Don’t use premiums to increase profits. Source: Based on Don Jagoda, “The Seven Habits of Highly Successful Premiums,” Incentive, (August 1999), Vol. 173, Issue 8, pp. 104-105.

  14. Creating Successful Contests and Sweepstakes • Know the legal restrictions. • Must overcome clutter. • Find the right combination of prizes. • Must consider extrinsic and intrinsic value. • Look for tie-in opportunities with special events or other companies. • Must be coordinated with POP Displays and other marketing tools.

  15. Successful Rebate/Refund Programs • Visibility. • Encourages customers to act. • Not be too complicated. • Avoid becoming a permanent component of the purchase decision (automobile rebates) • Profitable for retailers to handle.

  16. F I G U R E 10 . 6 Reasons for Using Bonus Packs • Increase usage of the product • Match or pre-empt competitive actions. • Stockpiling of product. • Develop customer loyalty. • Attract new users. • Encourage brand switching.

  17. Price-Offs • Temporary reduction in price. • Excellent for boosting short-term sales. • Excellent for generating customer traffic. • Can be implemented easily. • Must be careful not to increase customer price sensitivity. • Can have detrimental impact on brand and corporate image.

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