Sales Promotion Tools in Retail Sector in HK BJ

AN MVA RESEARCH
Sales Promotion Tools in Retail Sector in Hong Kong and Beijing

2010 BMSR Group MVA Hong Kong Ltd
Address: 14th Floor West, Warwick House, TaiKoo Place, 979 King's Road, Island East, Hong Kong Tel: (852) 2529 7037 Fax: (852) 2527 8490 Email: bmsr@mvaasia.com Website: http://bmsr.mvaasia.com (MVA BMSR Group) http://www.mvaasia.com (MVA in Asia)
An MVA Research Sales Promotion Tools in Retail Sector in Hong Kong and Beijing
LIST OF CONTENTS Page
Executive Summary Study Objectives and Scope Research Design and Methodology Sales Promotion Tools Hong Kong in a Glance Findings in Hong Kong Beijing in a Glance Findings in Beijing MVA Perspectives
1 10 11 14 20 25 52 57 82
References Appendix A - Profile of Survey Respondents
85 86
Executive Summary
Consumer goods and services are getting more sophisticated these days. Different
varieties of products and services addressing varying consumer needs are presented in an increasingly competitive market place, going beyond the traditional efficacy claims of the lower spectra of the Maslows needs hierarchy.
Retailers, as well as some of their partnering manufacturers, try to vie for the share of voice in the market with heavy advertising and promotion to break through the clusters and eventually to gain more substantial share of the market. Sales promotion acts as a
competitive tool which provides consumers an extra incentive to purchase one brand over the others at one retailer over the others. Now, sales promotions has become an integral part of the marketing strategies of many retailers, and the successful deployment and implementation of sales promotion tactics at the right time can lead to substantive growth in sales transactions and sales revenues. Sales promotion consists of a diverse collection of
incentive tools to elicit a quicker or greater consumer purchases in a short period of time. Here are some examples: direct discount, coupon, bonus pack, buy-one-get-one-free offer, free premium, stamp redemption, contest, game and sweepstake, and free sample.
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MVA conducted a research study on sales promotion tools in the retail sector in 2010. Two leading Chinese metropolis - Hong Kong and Beijing were covered in this study. The
aim of this study was mainly to gather updated information on consumers preferences and behavioral responses towards various sales promotion tools in both Hong Kong and Beijing. It would be a useful reference for retailers to respond to changing market dynamics and develop strategic sales and marketing promotion plans for future growth.
Research methods involved in this study included extensive desk research, consumer surveys via questionnaires and in-depth interviews with retailers in Hong Kong and Beijing. The survey was carried out in March 2010. A total of 457 questionnaires (Hong Kong: 237;
Beijing: 220) were obtained from consumers who had experience in buying products with sales promotion tools in the past 3 months prior to the survey from one or more of the following six core retail categories in this study, vis--vis:
1. supermarkets;
2. convenience stores;
3. retail shops selling clothing, footwear and allied products;
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4. Jewelry and watches retail stores;
5. retail shops selling home appliances or personal electronics; and
6. health and beauty retail stores.
In addition, in-depth interviews were undertaken with shop managers and management staff in sales and marketing in April 2010. Combining the results obtained from the above research methods, findings are summarized as below.
The key findings for Hong Kong are listed as below:
In overall, the top 5 most preferred sales promotion tools were: (1) discount, (2) coupon, (3) buy-one-get-one-free offer, (4) bonus pack / discount for a package and (5) free sample. In contrast, contest, game and sweepstake were the least preferred by Hong Kong consumers.
Apart from the five popular tools above, patronage rewards from credit card was most sought-after by consumers of home appliances / personal electronics and jewelry and watches. Free premium, on the other hand, was also preferred when purchasing
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health and beauty products and home appliances / personal electronics.
For the six core types of retail categories, direct discount was the most frequently used sales promotion tool. Apart from it, the following tools were also popularly used by consumers for different retail categories: Retail categories Supermarkets Convenience stores Retail shops selling clothing, footwear and allied products Jewelry and watches retail stores Retail shops selling home appliances or personal electronics Health and beauty retail stores Frequently used sales promotion tools rather than direct discount bonus pack, buy-one-get-one-free offer bonus pack, buy-one-get-one-free offer bonus pack, patronage rewards from credit card patronage rewards from credit card, membership programme patronage rewards from credit card, free premium bonus pack, coupon
It appears that Hong Kong consumers generally respond to sales promotions with high level of sensibilities they tend to be less likely in general to purchase brands that they are not used to, nor products that they do not have the need for, even there would be a lucrative sales promotion going on. Nonetheless, they admit that sales promotions are more likely to encourage them to buy more of products / services.
Direct discount and coupon were the top two effective sales promotion tools, to lead consumers to purchase more in quantity, switch to other brands and purchase
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additional unplanned products.
Cash was the common payment method when purchasing at supermarkets (56.9%) and convenience stores (49.6%), while credit card was the prevalent payment method when purchasing jewelry and watches (77.8%), home appliances / personal electronics (76.7%), clothing, footwear and allied products (52.1%), and health and beauty products (37.8%). Note that Octopus was a significant payment means at convenience stores (50.4%).
Visa payWave, first launched in Hong Kong in February 2008, is a new payment feature that speeds up transactions of $500 or below without having to swipe or insert the card to any device, and provides users with clear monthly statements or record-tracking purposes. 35% of the respondents knew about this new mode of electronic payment, with higher proportion of male respondents (40%). Those aged
30-49 (aged 30-39: 44%; aged 40-49: 46%) were more likely to be aware of the new payment feature. In terms of understanding of how the new payment method
works, 20% among those who knew Visa payWave could correctly mention the maximum transaction amount with no signature required was HK$500. An average The
score of 4.1 out of 10 in interest level towards Visa payWave was obtained.
figures indicated that many Hong Kong consumers are yet to become more aware of and knowledgeable on this new payment method. The level of attractiveness was not high among Hong Kong consumers in general, despite higher interests among those who have started using it according to another study about Visa payWave.
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The key findings for Beijing are listed as below:
In overall, the top 5 most preferred sales promotion tools preferred by Beijing consumers were: (1) discount, (2) buy-one-get-one-free offer, (3) coupon, (4) bonus pack / discount for a package, and (5) free sample. In contrast, contest, game and sweepstake were the least preferred by consumers in the capital.
Apart from the five popular tools above, free premium was also preferred by Beijing consumers when purchasing at supermarkets, convenience store, retail stores of home appliances / personal electronics and health and beauty products.
Direct discount was again the most frequently used sales promotion tool among the listed tools for the six core retail categories in this study. Apart from discount, the following tools were also popularly adopted by consumers in Beijing: Retail categories Supermarkets Convenience stores Retail shops selling clothing, footwear and allied products Jewelry and watches retail stores Retail shops selling home appliances or personal electronics Health and beauty retail stores Frequently used sales promotion tools rather than direct discount bonus pack, free sample bonus pack, buy-one-get-one-free offer bonus pack, membership programme bonus pack, coupon coupon, free premium free premium, free sample
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Among the sales promotion tools, direct discount was the most effective sales promotion tools to induce Beijing consumers in the survey to purchase more in quantity, switch to other brands and purchase additional unplanned products. coupon, bonus pack, buy-one-get-one-free offer were effective. And
Among the six core retail categories in this study, shoppers of jewelry and watches in Beijing were obviously less motivated by sales promotion tools.
Credit card was the most prevalent payment method for Beijing consumers when they purchased jewelry and watches (77.8%), home appliances / personal electronics (62.5%), clothing, footwear and allied products (61.1%), and health and beauty products (51.6%). For convenience stores (84.6%) and supermarkets (48.9%), cash Electronic cash appears to be not as
was still the common payment mean. widely-used in Beijing as it is in Hong Kong. The following are our insights and perspectives:
Direct discount was found to be the sales promotion tool most preferred in general by consumers, most frequently used in reality and most effective in influencing consumers self-proclaimed purchasing behaviors. Yet, it should be noted that both brand values and brand equities, both of which are image-driven, may be sacrificed or compromised if frequent and perennial discounts are to be offered, either by the product brands or by the retail shops. In addition, consumers may expect discounts of some sort to come, and hence refrain from buying or hold back purchases which have undesirable impacts on turnover and sales revenues. As a result, perennial direct discount despite being popular among consumers, may actually cause detrimental efforts on the profit margins of both manufacturers and retailers profit
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margins, as the listed regular prices are somewhat compromised and become inefficient. important. In addition, consumers may focus more on price reduction and jet-so The above issues should be carefully considered when deploying rather than the product itself, rendering the product claims and functions less long-term, perennial discounts as sales promotion tool.
It is not surprising that contest, game and sweepstake were rated to be the least preferred tool, the least frequently used and the least effective in inducing purchase behavior. It requires greater consumers involvement than with other tools, and the chance of actually winning is generally perceived to be slim. Given such consumer skepticism, it is advisable that more creative and attractive design in deploying contest, game and sweepstake as sales promotion device, should be considered in order to encourage more active consumers participations.
Couponing was preferred and perceived to be effective by consumers in the survey in inducing consumption behaviors in Hong Kong. However, it was not among the top 3 frequently used tools in the six core retail categories in the survey. It would be an opportunity for FMCG (fast moving consumer goods) and personal services retailers to consider promoting their products more with coupons with the deployment of convenient and handy mechanism in application such as mobile SMS coupon, or on-demand coupons for consumers to request when they need them, saving the hassles of clipping and storing paper coupons in wallets or elsewhere.
Fewer sales promotion tools are deployed for luxury brands or products than mass brands or products generally in Hong Kong and Beijing. The types of sales promotion tools deployed by the luxury versus the mass ones are quite different too. Price-oriented tools such as discount, bonus pack / package price and free premium are commonly used for mass products, while valuable premium gifts, charity events and value-adding services are deployed for luxury brands or products. In certain
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occasions, special auctioning of limited-edition items of luxury brands or products for charity or some special causes would be held to promote the brands image, vis--vis the target consumers needs and social status.
Consumers from different cities have different habits and demands.
It is crucial to
retailers to have a thorough understanding on local consumers needs and market trends before deploying any sales promotion tools, tailoring and offering corresponding sales promotion tools so as to enhance effectiveness of the tools, generate higher sales revenues and minimize the business risk.
Consumers are always attracted by various sales promotion tools to try a new product and make an initial purchase. However, the effects induced by sales promotion tools need to be sustained by the actual performance of the products, which should be the ultimate focus to retain loyal consumers so as to generate stable sales revenues in a longer term.
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Study Objectives and Scope
In the intensely competitive retail market, consumers always have many brand choices to consider for when making purchase decisions of any products and services. According to
the 20th Annual Survey of Promotional Practices which was conducted by Cox Direct, coupon, price promotions and good value influence 75% to 80% of consumers brand choice decisions. Deployment of sales promotion tools is crucial for retailers to attract and
motivate customers to purchase their products, in order to enhance competitiveness and maintain market share.
In the second quarter of 2010, MVA conducted a research study on consumers usage and attitudes towards sales promotion tools in retail sector. The target cities covered in the
research were the two leading Chinese metropolis - Hong Kong and Beijing. The research aimed to study and gauge updated information on the following aspects in the retail sector of Hong Kong and Beijing: trends in adopting sales promotion tools among consumers; consumers attitude and preference towards sales promotion tools; consumers behavioral responses towards sales promotion tools; effectiveness of sales promotion tools; and retailers choice in deploying sales promotion tools.
The research findings would be useful for Hong Kong and Beijing retailers to respond to changing market dynamics and develop sales and marketing strategic plan for future growth, especially by the deployment of sales promotion tools.
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Research Design and Methodology

The research methods in the study involved both primary and secondary methods. Secondary research was an extensive desk research while primary research included both quantitative (i.e. surveys) and qualitative methods (i.e. in-depth interviews). Combining the
above research methods could help generation of more comprehensive and objective results for this study.
With desk research, information on socio-economic backdrop, figures pertaining to the retail markets, trends in consumers adopting sales promotion tools in Hong Kong and Beijing, and as well as relevant research findings from other research studies were collected.
The quantitative part of primary research involved a self-administered questionnaire survey. The aims of the survey were to understand consumers usage, attitude and
behavioral responses towards sales promotion tools in different types of retail stores in Hong Kong and Beijing. The target respondents were local consumers aged 18 to 69 who had
experience in purchasing products with sales promotion tools from any of the following six core retail categories in the past 3 months prior to the conduction of the survey: supermarkets; convenience stores; retail shops selling clothing, footwear & allied products; jewelry & watches stores; retail shops selling home appliances / personal electronics; and health and beauty retail stores.
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Regarding the content of the questionnaire, there are six key parts, where each part was designed for one of the six core retail categories. each part: consumers shopping habit (e.g. shopping frequency, spending amount, payment method); consumers experience in enjoying sales promotion; consumers preference towards sales promotion tools; and consumers behavioral responses to different sales promotion tools. The following aspects were included in
The sales promotion tools being studied, which were common tools in the current market, were listed below. direct price-off / discount; coupon (including printed coupon, e-coupon); bonus pack / discount for a package; buy-one-get-one-free offer; free premium / gift / advertising specialties; joint / tie-in promotion; stamp redemption; contest, game and sweepstake; membership program; patronage rewards from credit card patronage rewards from Octopus card (for Hong Kong only); and free sample.
Details for each tool was described in the Section Category of sales promotion tools under the next Chapter Sales Promotion Tools.
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The survey was carried out in Hong Kong and Beijing in March April 2010. The total number of completed questionnaires was 457 (Hong Kong: 237; Beijing: 220). To obtain a
more representative sample, quota sampling by gender and age was applied during data collection process. For the demographical profile of survey respondents, please refer to Appendix 1.
The qualitative part was in-depth interviews with shop managers or sales and marketing-related management staff in the retail sector in both Hong Kong and mainland China. It served as a supplementary part to understand the deployment of sales promotion tools and consumers response towards sales promotion tools from the perspective of retail operators. A semi-structured discussion guideline was designed. The major topics covered
in the guideline were factors of consideration in deploying sales promotion tools, effectiveness of sales promotion tools, observed consumers preference and responses towards sales promotion tools. The interviews were undertaken in April May 2010 and
the respondents included retailers representatives from both mass products and luxury products, with watch, clothing and other retail industries.
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Sales Promotion Tools

Definition of sales promotion tools
Haugh (1983) defined sales promotion as a direct inducement that offers an extra value or incentive for the product to the sales force, distributors, or the final consumer with the primary objective of creating an immediate sale. According to the article of Review of the
Literature about Sales Promotion and Brand Equity, the master of modern marketing, Philip
Kotler noted that sales promotions that mostly last for a short term were composed of a diverse collection of incentive tools that were utilized to motivate consumers to make large amounts of purchase, some of which could be trials, on the certain product in advance and with rapidity.
There are plenty more definitions on sales promotion tools, but they all share a common ultimate goal of directly inducing consumers to purchase in order to enhance immediate sales volume.
History of sales promotion tools
When we trace the origin of sales promotion tools in the modern retail sector, it may all start at middle of the 19th century. In 1853, a hat shop in America held a promotion activity, in which every customer who bought a certain brand of hat was to be offered a photo-taking service for free. As camera was not a common thing at that time, customers felt proud when
they showed the photo of wearing the hat to others. Therefore, the activity finally attracted many customers and even people who lived far away came to the shop and bought hats of
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that brand for its photo-taking promotion.
The shop, on the other hand, thus became
famous in wake of the successful promotion activity for one of the brands it carried.
Later on with creative minds and business savvy, various types of sales promotion tools were introduced in the retail market. In 1980s, the amount of budget used on sales The expenditure on sale promotion
promotion was just similar to that used on advertising.
has increased over the following 20-30 years and the amount of increment was phenomenal. By the end of the 20th century, according to Cox Directs 20th Annual Survey of Promotional Practices, many companies spent about three-quarters of the total promotional budget on sales promotion, with the remaining quarter on advertising. Retailers would say advertising
provides reasons for purchasing, while sales promotion tools simulate purchase. So, they would like to apply sales promotion tools to target customers for a quick booster of sales and they would like to have immediate outcomes.
Categories of sales promotion tools
According to the article of Review of the Literature about Sales Promotion and Brand
Equity, Philip Kotler outlined thirteen sale promotion tools which included:
1. sample 2. coupon 3. rebates 4. price packs 5. premium 6. frequency programs 7. prizes 8. patronage awards 9. free trials 10. product warranties 11. tie-in promotion 12. cross-promotion 13. point-of-purchase displays and demonstrations
In recent years, there are new sales promotion tools appeared in the market as well as
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new delivery platforms, such as patronage awards from credit cards and e-coupons via email, mobile phone and Point-Of-Sale (POS) interactive devices. Currently, the main popular sales promotion tools which are offered by different retail sectors in Hong Kong and Beijing are shown as below: Direct price-off / discount A price discount is a temporary reduction of the listed price of the product. Coupon (including printed coupon, e-coupon, and m-coupon) Printed coupon, which are available in magazines and newspapers or at the point-of-purchase, or electronic / mobile coupon, which may be downloaded from the internet or email, or via push or pull SMS, of price on certain products. Bonus pack / discount for a package Provide additional quantity of product at the regular price in an enhanced package or offer a separate package of product at a discounted price. Buy-one-get-one-free offer One more item is offered for free if the customer buys one item of a product at regular price. Buy-two-get-one-free and buy-three-get-one free are similar entitle the customer to a reduction
tools under the same deployment rationale. Free premium / gift / advertising specialties Gift / item offered free in return for the purchase of one or more products. Joint / tie-in promotion Another product is offered for free or at a discount upon purchasing of a particular product. Stamp redemption - Stamp accumulations from repeat purchasing for discount, collectible premium or
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gift. Contest, game and sweepstake Games, activities, competitions and lucky draws are offered upon purchase of a certain product or arriving at a certain amount of values. Membership program Discount or free product rewards are offered upon joining the membership program; members are later on entitled to certain privileges (such as additional discounts or priority services, etc). Patronage rewards from credit card Points accumulations on credit card for discount, gift redemption, or cash refunds. Patronage rewards from Octopus card (for Hong Kong only) Points accumulations on Octopus card for discount, gift redemption, or cash refunds. Free sample Provides consumers a free small portion of a product, usually new to the market, for trial.
Some researchers have attempted to classify sales promotion tools into several categories. Dommermuth (1989) suggested two types of sales promotion categories by the incentive types. One was from economic incentive, including discount, coupon and rebates, while another was from psychological incentives, including premium and sweepstake. Shimps
(1990) categorized sales promotion tools based on timing given by sale incentives, instant and postponed sales promotion tools. Discount, premium, and bonus pack were grouped
as instant sales promotion tools, while coupon, sweepstake, and rebates were grouped as postponed sales promotion tools. Campbell and Diamond (1990) grouped two varieties of
sales promotion, monetary sales promotion and nonmonetary sales promotion.

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Discount and rebates were the examples of the incentive for monetary sales promotion which enables influencing reference price. Premium and trial offers were the examples of incentive for nonmonetary sales promotion, which is regarded as an extra benefit and is not able to influence reference price.
Classifications Economic incentive Psychological incentive
Examples of sales promotion tools Discount, coupon and rebates Premium and sweepstake
Source: Dommermuth (1989)

Instant Postponed Discount, premium and bonus pack Coupon, sweepstake and rebates
Source: Shimp (1990)

Monetary Nonmonetary Discount and rebates Premium and trial offers
Source: Campbell and Diamond (1990)
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Purposes of sales promotion tools
In general, the purposes of retailers in deploying various sales promotion tools are as follow: simulate customers desire of immediate purchasing; generate short-term increase in sales on a certain product; increase flow of customers; encourage repurchases; stimulate consumers' desire to try out new product; attract new customers and encourage brand switching; enhance retailers competitiveness and secure market share; retain and reward existing loyal customers, in order to further customers loyalty; promote retailers / brands name and reputation; reinforce retailers / brands image; and match corporate plans through temporary incentives.
Discount was well-documented to be an effective sales promotion tool for increasing immediate sales volume. Bonus pack (Ong, 1999), specialty advertising (Lee, 2002) and continuity programs (Ong, 1999), were treated as useful tools to encourage large purchases or repeat purchases. In addition, sampling and trial offers, coupon and rebates motivated
consumers purchases of new products.
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Hong Kong in a Glance

Socio-economic overview
Hong Kong is a special administrative region (SAR) of China, geographically situated on the south coast of mainland China. It spreads out over 1,100 square km and the
population exceeds seven million people since mid-2009. Hong Kong is one of the world's leading business, trade and financial centre, with characteristics of free trade, low taxation and minimum government intervention. And it serves as a gateway for businessmen to gain
entrance to the mainland's massive market, as well as a global business platform.
With the onslaught of the global financial tsunami in 2008 and the ensuing global recession, Hong Kong economy contracted in the first quarter of 2009. Nevertheless, it staged a rebound from the second quarter and then improved further in the rest of the year. According to the statistical figures provided by Hong Kong Census and Statistics Department, Hong Kongs gross domestic product (GDP) in 2009 dropped to HK$1,634 billion, with a year-on-year contraction of 2.7% in real terms, registering the first annual recession for the SAR since 1998. The GDP per capita in 2009 also fell to HK$233,239, with a year-on-year decline of 3.0% in real terms.
According to the report of 2009 Economic Background and 2010 Prospects published by the Hong Kong Government, the Hong Kong economy outlook appears to be positive with an annual growth of 4 to 5% in 2010.
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Retail market overview

Hong Kong is a service based economy, where service sector accounts for about 90% of Hong Kong's GDP . The wholesale, retail and import / export trades, restaurants and hotels
sector is the largest service industry and contributes nearly three-tenths of Hong Kongs GDP. Over the years, Hong Kongs retail industry has taken a significant role in the development of the local economy. The retail industry in Hong Kong is mature and highly developed, with Tourists have made
such nicknames as Shoppers' Paradise and Gourmet Paradise.
significant contributions in sales volumes in Hong Kongs retail market, especially for luxury brands and products, such as jewelry and watches.
According to the statistical figures provided by Hong Kong Census and Statistics Department, the total retail sales value for the year 2009 amounted to HK$274.7 billion, with a slight annual increase by 0.6%, compared to an increase of 10.6% in 2008. And the retail
sales volume in 2009 declined annually by 0.8%, compared to an increment of 5.0% in 2008. According to the latest figures, in March and April 2010, there were 19% and 16% year-on-year growth in retail sales value and 17% and 12% year-on-year increase in retail sales volume, respectively. In addition, the Composite Consumer Price Index (CPI) in Hong
Kong in 2009 was slightly increased by 0.5%, compared to an increase of 4.3% in 2008. The CPI registered year-on-year increments of 2.0% and 2.4% in March and April 2010, respectively. Year 2007-2008 2008-2009 Retail sales value +10.6% +0.6% Retail sales volume +5.0% -0.8% CPI +4.3% +0.5%
Under the assumption that the global recovery that began in mid-2009 should continue
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in 2010, Hong Kongs economy should undertake a further rebound in 2010.
Also,
representatives from the retail sector during our in-depth interviews also have expressed that they hold positive attitude towards the economy and retail market trends in 2010. With
the economic recovery in Hong Kong, some price pressures and inflations are likely to return. Retailers are expected to deploy various marketing and promotion tactics to continue enhancing their competitiveness and move towards a higher value-adding market.
Deployment of sales promotion tools
In Hong Kongs mature retail industry, deployment of sales promotion tools is very common for almost all types of products and brands at various retail stores in the Shoppers Paradise. According to Tai and Tam (1996), sales promotion appeared to be more effective
than advertising in marketing campaigns in Hong Kong market, as Hong Kong consumers were less likely to be loyal to a particular brand and they were more likely to shop around for special offers. This is consistent with the result of a marketing research study undertaken by
the former AC Nielsen company in 2003, in which two-thirds of Hong Kong consumers were labeled as compulsive buyers who made purchase decisions at the point of sale. So they were presumably be more influenced by point-of-sale promotions. As such, sales
promotion tools play a crucial role in attracting consumers for purchase and helping many retailers to maintain sales volume. This is particularly evident with retailers of mass brands
and products that always deploy plenty of various types of sales promotion tools to boost sales, such as supermarkets (e.g. Park N Shop, Wellcome), convenience stores (e.g. Circle K, 7-11), and personal health and beauty shops (e.g. Mannings and Watsons). The main sales promotion tools deployed by these establishments mainly include direct price-off, coupon, bonus pack / discount for a package, buy-one-get-one-free offer, free premium and free
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sample.
In addition, endorsement from celebrities and stars is also very common.
However, according to results of a 2009 survey published by the Readers Digest (), only 4% of Asia consumers claimed that the celebrity endorsement can enhance their confidence towards the products.
Some new concepts on sales promotion tools have emerged in Hong Kongs retail market, such as patronage awards from credit cards and e-coupons. In addition,
redemption of collectible premiums has become one of very popular and effective sales promotion tools since the turn of the century.
McDonalds Snoopy Collection was one of the earlier pioneers with remarkable success in collectible redemption in Hong Kong. In 1998, McDonalds customers could pay
at a low price to get a Snoopy figure upon purchase of its extra value meals. There were totally 28 different Snoopy figures in a full set. Each Snoopy dressed in 28 different
countries national costumes. The sales promotion event raised the popularity of collecting a complete set of cartoon figures among Hong Kong people. Many Hong Kong people had a craze for the Snoopy collection and long queues always appeared at McDonalds during the promotion period.
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Similarly, 7-11 also launched a collectible redemption in Hong Kong in 2004. Consumers could get one Hello-Kitty badge for free when they spent $20 or more at 7-11. There were a total of about 30 badges in a full set of the collection. The promotion period
was 12 weeks in the original plan, and it was extended for 2 weeks due to its overwhelming popularity. At the end, twenty millions of free badges were offered over the sales promotion period of the 14 weeks.
Collectible redemptions have become popular among Hong Kong consumers in recent years and it is one of the more frequently deployed tools among retail operators, as it increases consumers interests in patronizing the specific retail establishments and also helps retail operators to enhance the retail sales values and patronage flow. Seeing the success of the tools, other supermarkets, convenience stores and fast food restaurants follow suit and launch similar schemes.
For luxury products and high end retail shops in Hong Kong, relatively fewer tools are deployed when compared to mass products. Discount and package price are rarely offered in luxury retailers with high-price segment products o brands, but free gifts of unique design Events of
or limited edition are sometimes offered, such as pen, red wine and watch box.
special interests are held for their existing or potential consumers, such as golf trips and wine-tasting sessions. Instead of deploying price-oriented promotion tools, more
value-adding or service-added tools / events, such as charity events, endorsement of spokesman and comprehensive after-sales service, are offered for luxury items in order to reinforce brand images.
Sales promotion tools are crucial tool for retailers to sustain the sales volume and speed
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up stock replenishment.
Existing stock volume is one of the important factors of
considerations when deciding which sales promotion tools to deploy. For example, if a retailer wants to clear the stock to make room for new inventory in a short period of time, it may consider deploying buy 3 get 1 free campaign or major discounts for every 5 items purchased.
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Findings in Hong Kong

(I) Interest level towards sales promotion tools in general
Respondents rated their interest level towards 12 sales promotion tools in general on a 5-point scale, with 1 represents not interested at all and 5 represents very interested. Among the 12 tools, Hong Kong consumers overwhelmingly showed their level of interest to direct discount from regular retail prices with average interest score of 4.5, followed distantly by coupon (3.7), buy-one-get-one-free offer (3.5), bonus pack / discount for a package (3.3) and free sample (3.3). In contrast, contest, game and sweepstake (2.3),
stamp redemption (2.6) and joint / tie-in promotion (2.7) were relatively less popular sales promotion means.
Fig. 1: Interest level towards sales promotion tools in general

Direct price-off / discounts Coupons Buy one get one free Bonus pack / discounts for a package Free samples Free premiums / gifts / advertising specialities Membership programme Earn and redeem rewards from Octopus cards Patronage rewards from credit cards Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes 0 1 2
4.5 3.7 3.5 3.3 3.3 3.1 3.0 3.0 2.9 2.7 2.6 2.3
3 4 5
S4: Please use a 5-point scale to show your interest level towards the sales promotion tools in general, where 1: not interested at all; 5: very interested Base: 237
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(II) Retail Purchasing Pattern 1. Frequency of purchase
Shoppers of groceries and daily goods at supermarkets and convenience stores made their purchases more often among the six core retail categories included in our questionnaire, with about 81% of supermarket consumers and 88% of convenience stores shoppers made purchases at least once per week. In the case of convenience stores, about 10% of the shoppers even made daily purchases. On a lesser note, 77% of shoppers of personal
wellness / care products at health and beauty retail stores and 62% of shoppers of clothing, footwear and allied products made purchases at least once per month. For those big-ticket purchases, about 72% of consumers of jewelry and watches made purchases within the past 6 months while 90% of consumers of home appliances / personal electronics made purchases in the past 12 months. Fig. 2: Retail purchasing pattern: Frequency of purchase at different core retail categories
A. Supermarkets
Everyday 4-6 times per week 2-3 times per week Once a week Once per 2-3 weeks Once per month Less than once per month 0% 4.6% 1.0% 10% 20% 30% 40% 50% 13.2% 22.3% 5.6% 17.3% 36.0%
B. Convenience stores
Everyday 4-6 times per week 2-3 times per week Once a week Once per 2-3 weeks Once per month Less than once per month 0% 5.3% 3.8% 3.1% 10% 20% 30% 40% 50% 19.1% 9.9% 20.6% 38.2%
A1. How frequent do you purchase at supermarkets? Base: 197
B1. How frequent do you purchase at convenience stores? Base: 131
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C. Retail shops selling clothing, footwear and allied products Once per half month or more frequent Once a month Once per 2 months Once per 3 months Once per 4 months or less frequent 0% 11.7% 6.4% 10% 20% 30% 40% 50% 20.2% 28.7% 33.0%
D. Jewelry and watches retail stores Once a month or more frequent Once per 2-3 months Once per 4-6 months Once per 7 months - 1 year Once per 2 years Once per 3 years or less frequent 0% 11.1% 5.6% 11.1% 10% 20% 30% 40% 50% 5.6% 27.8% 38.9%
C1. How frequent do you purchase at retail shops selling clothing, footwear and allied products? Base: 94
D1. How frequent do you purchase at jewelry and watches stores? Base: Less than 20
E. Retail stores of home appliances / personal electronics Once a month or more frequent Once per 2-3 months Once per 4-6 months Once per 7 months - 1 year Once per 2 years or less frequent 0% 9.3% 10% 20% 30% 40% 50%
F. Health and beauty retail stores Once a week or more frequent Once per 2-3 weeks 13.5% 36.5% 27.0% 13.5% 5.4% 4.1% 0% 10% 20% 30% 40% 50%
11.6% 20.9%
Once per 1 month
16.3% 41.9%
Once per 2 months Once per 3 months Once for more than 3 months
E1. How frequent do you purchase at retail stores of home appliances / personal electronics? Base: 43
F1. How frequent do you purchase at health and beauty retail stores? Base: 74
2. Spending
Regarding the average spending amount, consumers of supermarkets spent HK$90 for each visit while those of convenience stores spent HK$25 per transaction. Shoppers at health and beauty retail stores made an average monthly spending of HK$229 on personal wellness / personal care products. Those shopping for clothes, footwear and allied products spent an average of HK$1,198 in each quarter. For the consumers of home appliances / personal
electronics, and jewelry and watches, they spent an average of HK$2,640 and HK$7,473 at their most recent purchases, respectively.
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Fig. 3. Retail purchasing pattern: Average spending A. At supermarkets B. At convenience stores C. At shops of clothing, footwear and allied products D. At jewelry and watches stores E. At stores of home appliances / personal electronics F. At health and beauty stores HK$90 (per transaction) HK$25 (per transaction) HK$1,198 (per season) HK$7,473 (most recent purchase) HK$2,640 (most recent purchase) HK$229 (per month)
A2-F2. Average spending Base: 197 (A), 131 (B), 94 (C), less than 20 (D), 43 (E), 74 (F)
3. Payment method
Cash was popular payment method at supermarkets (56.9%), convenience stores (49.6%) and shops of clothing, footwear and allied products (37.2%). But in this modern city, Credit card was a
consumers also used electronic payment methods during shopping.
prevalent payment method, especially for high-priced products, such as jewelry and watches (77.8%) and home appliances / personal electronics (76.7%), as well as clothing, footwear and allied products (52.1%) and health and beauty products (37.8%). Also, Octopus played
a significant payment role at convenience stores (50.4%), supermarkets (27.4%) and health and beauty stores (27.0%).
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Fig. 4. Retail purchasing pattern: Payment method

A. Supermarkets Others, EPS, 5.1% 0.5% Credit card, 10.2%
Octopus 50.4% B. Convenience stores
Octopus, 27.4%
Cash, 56.9%
Cash 49.6%
A3. Which payment method do you use most frequently at supermarkets? Base: 197
B3. Which payment method do you use most frequently at convenience stores? Base: 131
C. Retail shops selling clothing, footwear and allied products EPS, 9.6% Cash, 37.2%
D. Jewelry and watches retail stores EPS, 11.1% Cash, 11.1%
Credit card, 52.1%
Octopus, 1.1%
Credit card, 77.8%

F3. Which payment method do you use most frequently D3.Which payment method do you use most frequently at health and beauty retail stores? at jewelry and watches retail stores? Base: 74 than 20 Less
E3. Which payment method C3. Which payment method do you use most frequently at retail stores selling clothing footwear and allied products? shops of home appliances / personal electronics? 43 Base: 94
E. Retail stores of home appliances / personal electronics EPS, 7.0% Cash, 16.3%
F. Health and beauty retail stores

EPS, 5.4% Cash, 29.7% Credit card, 37.8% Octopus, 27.0%
F3. Which payment method do you use most frequently at health and beauty and retail stores? Base: 74
Credit card, 76.7%

E3. Which payment method do you use most frequently at retail stores of home appliances / personal electronics? Base: 43
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(III) Usage of and Perception towards Sales Promotion Tools
1. Frequency of enjoying sales promotion
Direct discount was the most frequently used sales promotion tool.
Among the six
categories of retail stores, direct discount was more common at supermarkets, shops of clothing, footwear and allied products, shops of home appliances / personal electronics and health and beauty stores. Apart from direct discount, other popular sales promotion tools
for each type of retail stores were listed below.
Bonus pack / discount for a package, earn and redeem rewards from credit card, and buy-one-get-one-free offer were also popular promotion tools that consumers can enjoy at supermarkets. For convenience stores, buy-one-get-one-free offer, bonus pack / discount for a package, and coupon were frequently adopted. Shoppers of retail shops
selling clothing, footwear and allied products were more frequently enjoyed bonus pack / discount for a package, patronage rewards from credit card and coupon. As for jewelry
and watches shops, patronage rewards from credit card was a popular tool used by consumers, next come to membership programme. Patronage rewards from credit card, free premium and coupon were popular to home appliances / personal electronics purchases. For health and beauty stores, bonus pack / discount for a package, coupon
and free sample were comparatively frequently used by consumers.
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Fig. 5. Frequency of enjoying sales promotion at different core retail categories

A. Supermarkets
Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption
73.6% 18.3% 35.5% 32.0% 15.7% 7.6% 13.2% 19.3% 31.0% 21.8% 34.5% 14.7%
0% 10% 20%
21.8% 52.3% 42.1% 44.7% 22.3% 23.4% 46.2% 62.9% 57.9% 76.1% 53.8% 63.5%
4.6%
29.4%
38.1% 29.4% 28.9%
Contests, games and sweepstakes 4.6% Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples
15.2% 14.7%
21.8% 30.5%
30% 40% 50% 60%
43.7% 54.8%
70% 80% 90% 100%
Always / Everytimes
Sometimes
Never / Seldom
A4. How often do you enjoy sales promotion at supermarket? Base: 197
Direct price-off / discounts Coupons Bonus pack / discount for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes
55.7% 22.9% 26.0% 26.0% 15.3% 9.2% 13.0% 7.6% 21.4% 18.3% 20.6% 29.0% 29.0% 20.6% 33.6% 32.8%
29.0% 56.5% 40.5% 41.2% 55.7% 70.2% 58.0% 71.0% 74.8% 80.2%
15.3%
Membership programme 6.9%
Patronage rewards from credit cards 6.1% 13.7% Earn and redeem rewards from Octopus cards Free samples
16.8% 13.7%
0% 10%
19.1% 19.1%
20% 30% 40% 50%
64.1% 67.2%
60% 70% 80% 90% 100%
Always / Everytimes
Sometimes
Never / Seldom
B4. How often do you enjoy sales promotion at convenience stores? Base: 131
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C. Retail shops selling clothing, footwear and allied products

Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption
79.8% 28.7% 33.0% 27.7% 13.8% 16.0% 11.7% 22.3% 24.5% 14.9% 30.9% 23.4% 78.7% 78.7% 44.7% 46.8% 29.8% 63.8% 59.6% 73.4% 18.1% 39.4% 53.2%
18.1% 2.1% 27.7% 42.6%
Contests, games and sweepstakes 5.3% 16.0% Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples
24.5% 29.8% 9.6% 11.7% N/A

0% 10% 20% 30%
40%
50%
60%
70%
80%
90% 100%
Always / Everytimes
Sometimes
Never / Seldom
C4. How often do you enjoy sales promotion at retail shops selling clothing, footwear and allied products? Base: 94
D. Jewelry and watches retail stores

Direct price-off / discounts Coupons
44.4% 11.1% 11.1% 11.1% 11.1% 5.6% 11.1% 5.6% 16.7% 27.8% N/A N/A 0% 10% 20% 30% 40% 50% 60% 22.2% 38.9% 27.8% 88.9% 16.7% 27.8% 77.8% 83.3% 83.3%
50.0% 61.1% 72.2% 61.1%
5.6%
5.6% Bonus pack / discounts for a package 5.6%

Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples
11.1% 11.1%
61.1% 33.3%
70%
80%
90%
100%
Always / Everytimes
Sometimes
Never / Seldom
D4. How often do you enjoy sales promotion at jewelry and watches retail stores? Base: less than 20
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E. Retail stores of home appliances / personal electronics

Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion 7.0% Stamp redemption 4.7% 25.6% 11.6% 16.3% 25.6% 30.2% 20.9% 16.3% 14.0% 46.5% 62.8% 74.4% 76.7% 23.3% 41.9% 14.0% N/A 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 9.3% 30.2% 76.7% 62.8% 27.9% 72.1% 37.2% 72.1% 69.8% 27.9% 20.9% 37.2% 7.0%
Contests, games and sweepstakes 4.7% 18.6% Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples 14.0%
Always / Everytimes
Sometimes
Never / Seldom
E4. How often do you enjoy sales promotion at retail stores of home appliances / personal electronics? Base: 43

Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption 35.1% 36.5% 31.1% 24.3% 13.5% 16.2% 17.6% 23.0% 23.0% 24.3% 32.4% 28.4% 27.0% 13.5% 31.1% 33.8% 24.3% 77.0% 48.6% 50.0% 62.2% 36.5% 73.0% 32.4% 37.8% 40.5% 39.2% 23.0% 32.4% 25.7% 28.4% 36.5% 52.7% 59.5% 4.1%
Contests, games and sweepstakes 5.4% Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Always / Everytimes
Sometimes
Never / Seldom
F4. How often do you enjoy sales promotion at health and beauty retail stores? Base: 74
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2. Interest level towards sales promotion tools

Direct discount was the sales promotion tool mostly liked by consumers of the six core retail categories, with an average score in interest level of 4.3 to 4.8. It was most sought
after by shoppers of clothing, footwear and allied products (4.8), and home appliances / personal electronics (4.7). The second most popular tool was coupon for the six retail
store types, with higher average scores at home appliances / personal electronics stores (3.9) and health and beauty stores (3.8).
Apart from discount and coupon, bonus pack / discount for a package (2.8 to 3.5) and buy-one-get-one-free offer (2.8 to 3.4) were also tools which were favored by shoppers of supermarkets, convenience stores, shops of clothing, footwear and allied products, jewelry and watches stores, and health and beauty stores. Shoppers of home
appliances / personal electronics stores (3.4) and jewelry and watches stores (3.1) showed interests in patronage rewards from credit card. In addition, free premium was popular among shoppers of health and beauty stores (3.4) and home appliances / personal electronics stores (3.3). stores (3.5). And free sample was quite popular among shoppers of health and beauty
On the other hand, contest, game and sweepstake were relatively less favored by consumers, with average scores ranged from 2.0 to 2.4.
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Fig. 6. Interest level towards sales promotion tools

A. Supermarkets
Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples 0 1 2 3 2.4 2.8 2.7 2.9 3.1 4 5 2.6 2.6 3.1 3.3 3.4 3.6 4.5
A5: Please use a 5-point scale to show your interest level towards the sales promotion tools at supermarkets. (1 represents totally disagree and 5 represents totally agree) Base: 197
Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples 2.5 2.5 2.3 2.2 2.2 2.7 2.8 2.9 3.1 3.2 3.4 4.4
B5: Please use a 5-point scale to show your interest level towards the sales promotion tools at convenience stores. (1 represents totally disagree and 5 represents totally agree) Base: 131
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Direct price-off / discounts Coupons Bonus pack / discount for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples 0 N/A 1 2 3 4 5 2.4 2.0 3.2 3.0 2.7 2.5 2.9 3.3 3.6 3.5 4.8
C5: Please use a 5-point scale to show your interest level towards the sales promotion tools at retail shops selling clothing, footwear and allied products. (1 represents totally disagree and 5 represents totally agree) Base: 94

Direct price-off / discounts for a package Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programe Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples 0 N/A N/A 1 2 3 4 5 2.1 2.1 2.0 2.6 3.1 2.8 2.8 2.8 3.2 4.3
D5: Please use a 5-point scale to show your interest level towards the sales promotion tools at jewelry and watches retail stores. (1 represents totally disagree and 5 represents totally agree) Base: less than 20
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Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples 0
4.7 3.9 2.7 2.8 3.3 2.5 2.2 2.0 2.7 3.4 2.4 N/A
1 2 3 4 5
E5: Please use a 5-point scale to show your interest level towards the sales promotion tools at retail stores of home appliances / personal electronics.. (1 represents totally disagree and 5 represents totally agree) Base: 43

Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples 0 1 2 3 2.1 2.9 2.8 2.7 3.5 4 5 2.7 2.6 3.5 3.4 3.4 3.8 4.6
F5: Please use a 5-point scale to show your interest level towards the sales promotion tools at health and beauty retail stores.. (1 represents totally disagree and 5 represents totally agree) Base: 74
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(IV) Behavioral Responses towards Sales Promotion Tools
1. Increase the quantity of usually-purchased products
In terms of behavioral responses towards different sales promotion tools, direct price-off was the most effective tool in the six core retail categories in the study to induce consumers purchasing more quantity of products which they usually buy, with average Likert1 scores of 4.0 to 4.5. Apart from direct price-off, couponing was also an effective tool (3.1 to 3.6).
Buy-one-get-one-free offer (3.1 to 3.6) and bonus pack / discount for a package (3.1 to 3.6) were also seen to be effective to motivate shoppers at supermarkets, convenience stores, shops of clothing, footwear and allied products, and health and beauty stores to purchase more in quantity. Among consumers of home appliances / personal electronics
stores (3.2) and jewelry and watches stores (3.1), patronage rewards from credit card was effective to induce captioned behavioral response. In addition, free sample (3.4) and
free premium (3.1) were also effective in leading consumers to buy more in quantity at health and beauty stores and home appliances / personal electronics stores, respectively.
A Likert Scale is a psychometric bi-polar scale commonly used in questionnaire to illustrate the psycho-driven behaviours of respondents via a typical 5-point Likert item: (5) Strongly / totally agree (4) (Somewhat) agree (3) Neither agree nor disagree (2) (Somewhat) disagree (1) Strongly / totally disagree.
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Fig. 7. Increase the quantity of usually-purchased products under influence of sales promotion tools
A. Supermarkets
Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programe Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples
4.4 3.6 3.5 3.6 3.2 2.8 2.7 2.4 2.8 2.6 2.9 3.1 0 1 2 3 4 5
A6: What is your level of agreement on the sales promotion tool induce you to increase the quantity of usually-purchase product at supermarkets? (1 represents totally disagree and 5 represents totally agree) Base: 197
Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples
4.0 3.3 3.1 3.1 2.8 2.5 2.5 2.4 2.3 2.3 2.6 2.8 0 1 2 3 4 5
B6: What is your level of agreement on the sales promotion tool induce you to increase the quantity of usually-purchase product at convenience stores? (1 represents totally disagree and 5 represents totally agree) Base: 131
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4.5 3.6 3.6 3.4 2.9 2.8 2.5 2.2 3.0 2.9 2.5 N/A 0 1 2 3 4 5
C6: What is your level of agreement on the sales promotion tool induce you to increase the quantity of usually-purchase product at retail shops selling clothing, footwear and allied products? (1 represents totally disagree and 5 represents totally agree) Base: 94

Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples N/A N/A 2.2 2.7 3.1 2.3 2.4 2.8 2.7 2.9 3.1 4.1
D6: What is your level of agreement on the sales promotion tool induce you to increase the quantity of usually-purchase product at jewelry and watches retail stores? (1 represents totally disagree and 5 represents totally agree) Base: less than 20
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4.0 3.3 2.8 2.7 3.1 2.6 2.3 2.2 2.7 3.2 2.6 N/A 0 1 2 3 4 5
E6: What is your level of agreement on the sales promotion tool induce you to increase the quantity of usually-purchase product at retail stores of home appliances / personal electronics? (1 represents totally disagree and 5 represents totally agree) Base: 43

Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples 2.2 2.9 2.8 2.8 3.4 2.7 2.6 3.2 3.6 3.6 3.6 4.4
F6: What is your level of agreement on the sales promotion tool induce you to increase the quantity of usually-purchase product at health and beauty retail stores? (1 represents totally disagree and 5 represents totally agree) Base: 74
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2. Switch to other brands which consumers do not regularly buy
The average score on level of agreement on that the sales promotion tools would lead consumers to switch to other brands which they do not regularly buy was slightly lower in general than that of behavioral responses mentioned in previous section. It was indicated
that Hong Kong consumers were comparatively less likely to switch to other brands which they do not regularly buy under the influence of sales promotion tools when compared to their likelihood of purchase more quantity of usually-purchased products.
Direct price-off was the most effective tool in leading consumers of the six core retail categories to buy other brands which consumers do not regularly buy (3.9 to 4.4), followed by coupon (2.9 to 3.6). Also, bonus pack / discount for a package (2.8 to 3.4) and buy-one-get-one-free offer (2.8 to 3.2) were effective, except at home appliances / personal electronics stores. For home appliances / personal electronics stores, free
premium (3.1) and patronage rewards from credit card (3.1) were effective tools following direct price-off and coupon. In addition, free sample and free premium were
effective to lead consumers to switch brands at health and beauty stores (free sample: 3.2; free premium: 3.1) and at supermarkets (free sample: 3.1; free premium: 3.1). And
patronage from credit card was effective for shoppers of jewelry and watches stores (2.9).
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Fig. 8. Switch to other brands which consumers do not regularly buy under influence of sales promotion tools
A. Supermarkets
Direct price-off / discounts Coupons Bonus pack ./ disocunts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples
4.1 3.4 3.1 3.2 3.1 2.8 2.5 2.3 2.6 2.5 2.8 3.1 0 1 2 3 4 5
A7: What is your level of agreement on the sales promotion tool induce you to switch to other brands which do not regularly buy at supermarkets? (1 represents totally disagree and 5 represents totally agree) Base: 197
4.0 3.4 3.0 3.1 2.8 2.5 2.4 2.3 2.3 2.2 2.6 2.8 0 1 2 3 4 5
B7: What is your level of agreement on the sales promotion tool induce you to switch to other brands which do not regularly buy at convenience stores? (1 represents totally disagree and 5 represents totally agree) Base: 131
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4.4 3.6 3.4 3.2 2.9 2.8 2.4 2.2 2.9 2.9 2.4 N/A 0 1 2 3 4 5
C7: What is your level of agreement on the sales promotion tool induce you to switch to other brands which do not regularly buy at retail shops selling clothing, footwear and allied products? (1 represents totally disagree and 5 represents totally agree) Base: 94

Direct price-off / discounts Coupons Bonus pack / discount for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples
3.9 2.9 2.8 2.8 2.4 2.2 2.3 2.3 2.7 2.9 N/A N/A 0 1 2 3 4 5
D7: What is your level of agreement on the sales promotion tool induce you to switch to other brands which do not regularly buy at jewelry and watches retail stores? (1 represents totally disagree and 5 represents totally agree) Base: less than 20
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4.1 3.6 2.6 2.7 3.1 2.6 2.3 2.0 2.7 3.1 2.5 N/A 0 1 2 3 4 5
E7: What is your level of agreement on the sales promotion tool induce you to switch to other brands which do not regularly buy at retail stores of home appliances / personal electronics? (1 represents totally disagree and 5 represents totally agree) Base: 43

4.1 3.5 3.1 3.2 3.1 2.6 2.5 2.2 2.6 2.7 2.6 3.2 5
0 1 2 3 4 F7: What is your level of agreement on the sales promotion tool induce you to switch to other brands which do not regularly buy at health and beauty retail stores? (1 represents totally disagree and 5 represents totally agree) Base: 74
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3. Purchase additional products which consumers have not planned to buy originally
The level of agreement on that the sales promotion tools would lead consumers to purchase additional products not planned originally was even lower in overall when compared to the previous two statements. It was indicated that consumers were less likely to purchase unplanned products under the influence of sales promotion tools when compared to their likelihood of purchase more quantity of usually-purchased products and brand switches.
Again, direct price-off (3.7 to 4.1) and coupon (3.0 to 3.4) were the most effective and the second most effective tools respectively, to lead consumers of the six core retail categories to buy additional products. Next, bonus pack / discount for a package (2.5 to 3.2) and buy-one-get-one-free offer (2.6 to 3.1) were also effective tools. In addition, free sample were effective at health and beauty stores (3.1) and supermarkets (3.0). And
patronage rewards from credit card were effective to motivate consumers of home appliances / personal electronics (3.0) and jewelry and watches (2.9) to make unplanned purchases.
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Fig. 9. Purchase additional products which consumers have not planned to buy originally under influence of sales promotion tools
A. Supermarkets
Direct price-off / discounts Coupons Bonus pack / disocunt for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples
4.0 3.2 3.0 3.0 3.0 2.7 2.5 2.3 2.5 2.4 2.7 3.0 5
0 1 2 3 4 A8: What is your level of agreement on the sales promotion tool induce you to purchase some additional products which are not planned to buy originally at supermarkets? (1 represents totally disagree and 5 represents totally agree) Base: 197
3.8 3.1 2.7 2.9 2.7 2.4 2.4 2.2 2.2 2.2 2.5 2.7 0 1 2 3 4 5
B8: What is your level of agreement on the sales promotion tool induce you to purchase some additional products which are not planned to buy originally at convenience stores? (1 represents totally disagree and 5 represents totally agree) Base: 131
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4.1 3.4 3.2 3.1 2.8 2.6 2.4 2.2 2.7 2.8 2.4 N/A 0 1 2 3 4 5
C8: What is your level of agreement on the sales promotion tool induce you to purchase some additional products which are not planned to buy originally at retail shops selling clothing, footwear and allied products? (1 represents totally disagree and 5 represents totally agree) Base: 94

Direct price-off / discounts Coupons Bonus pack / discount for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Earn and redeem rewards from Octopus cards Free samples
3.8 3.0 2.7 2.7 2.4 2.3 2.1 2.2 2.7 2.9 N/A N/A
0 1 2 3 4 5 D8: What is your level of agreement on the sales promotion tool induce you to purchase some additional products which are not planned to buy originally at jewelry and watches retail stores? (1 represents totally disagree and 5 represents totally agree) Base: less than 20
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3.7 3.1 2.5 2.6 2.6 2.5 2.3 2.0 2.6 3.0 2.5 N/A 0 1 2 3 4 5
E8: What is your level of agreement on the sales promotion tool induce you to purchase some additional products which are not planned to buy originally y at retail stores of home appliances / personal electronics? (1 represents totally disagree and 5 represents totally agree) Base: 43

3.9 3.3 3.2 3.1 3.0 2.7 2.4 2.2 2.7 2.7 2.6 3.1 0 1 2 3 4 5
F8: What is your level of agreement on the sales promotion tool induce you to purchase some additional products which are not planned to buy originally at health and beauty retail stores? (1 represents totally disagree and 5 represents totally agree) Base: 74
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(V) About Visa payWave

Visa payWave is a new mode of retail electronic payment. The first Visa payWave card in Hong Kong was launched in February 2008. Visa payWave is a new payment feature that
speeds up transactions up to HK$500 since consumers dont need to fumble for cash and physically insert the card into payment machine. With Visa payWave, Hong Kong
cardholders can pay transactions up to HK$500 with no signature was required. Cardholders can simply wave their card in front of the card reader and then the transaction is completed within seconds. Similar to other credit cards, the cardholders can have clear monthly statements for record-tracking purposes and also enjoy the same patronage rewards as regular Visa card. Now, there are more and more retail stores in Hong Kong which accept
Visa payWave payments, including supermarkets, convenience stores and fast food chains.
From the survey, it showed that 35% of the shoppers knew about this new mode of electronic payment. On a gender basis, there are higher proportion of male consumers
(40%) were aware of the Visa payWave payment than their females counterparts (31%). And consumers aged 30-49 (aged 30-39: 44%; aged 40-49: 46%) was the age group to have the highest proportion of knowing the new payment feature, while only 25% of those aged 50-59 and 11% of those aged 60-69 claimed that they knew Visa payWave. In terms of understanding of how the new payments method works, 20% among those who knew the Visa payWave could correctly mention the maximum transaction amount with no signature required was HK$500.
Regarding their interest towards this new payment method, an average score of 4.1 was obtained, using a rating scale of 1-10, where 1 indicating no interest at all and 10 indicating
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very interested. When compared to Octopus, only an average score of 2.9 was obtained for Visa payWave, which was much smaller than the average score of Octopus (7.1). The above
survey findings revealed that many Hong Kong consumers are yet to become more aware of and knowledgeable on this new payment method. among Hong Kong shoppers in general. The level of attractiveness was not high
It may partly due to the lack of promotion and However, according to another study about
knowledge on its functionality and advantages.
Visa payWave, higher interests among those who have started using it was found. Fig. 10. Awareness of Visa payWave Know the maxi amount for transaction without signature
Aware of Visa payWave
No 64.6%
Yes 35.4%
Yes 20.2% No 79.8%
G1. Do you aware of the new payment mode Visa payWave with some HK credit cards? Base: 237
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Beijing in a Glance
Socio-economic overview
Beijing, the capital of China, is the countrys economic, cultural and political centre. It is geographically situated in the north of the North China Plain and covers an area of 16,800 square km, which is the second largest city in size in China. Presently, Beijing has a total population of 17.6 million, with high volume of domestic and foreign tourists. The 2008 Summer Olympic Games ushered in hundred of thousands of tourists to the city.
In the past five years, both GDP and GDP per capita continue to grow consistently. Beijings total GDP in 2009 reached RMB 1,187 billion, with about 10% in real annual growth. Meanwhile, Beijings GDP per capita in 2009 amounted to RMB 67,612, with about 4% of annual growth in real terms.
According to the forecast given by The International Monetary Funds World Economic Outlook Update and The Economist Intelligence Unit, GDP for China is expected to register a real annual growth of about 10% in 2010. expected for Beijing as well. Considerable growth of GDP in 2010 is
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Market overview
The total retail sales value for 2009 amounted RMB 5,310 billion, with a year-on-year increase of 16% and double-digit annual growth in retail sales value was also recorded over the past 5 years.
The Consumer Price Index (CPI) and Retail Price Index (RPI) in Beijing in 2009 dropped by 1.6% and 2.2% year-on-year respectively, after constant growths from 2005 to 2008. It revealed that Beijings retail market in 2009 was affected by the global financial tsunami in 2008 after the Summer Olympic Games. During the period of economic downturn, most
retailers have suspended expansion plans and even shut down selected outlets with poor sales performances.
Fortunately, signs of stabilization had emerged in China and the worlds major economies in late 2009 and early 2010, which signaled that the global recession coming to the end and economy recovery in sight. With clearer and more positive economic outlook,
many retailers resumed their original expansion plans and some retailers are seizing the opportunities to regain the market shares. In addition, Beijing has started to focus more on expanding domestic demand and maintaining growth as advocated by the National Development and Reform Commission (). This is expected to
stimulate more retail activities and encourage retail operators to deploy more various types of marketing strategies and sales promotion tools to increase sales volumes, maintain and increase market shares, and strengthen market positioning.
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Deployment of sales promotion tools
Diverse sales promotion tools are often deployed in Beijings retail market, in which direct discount, coupon (both printed and electronic versions), free premium, stamp redemption and free sample, as well as spokesman endorsement, are popular tools. In the
past decade, credit card usage for retail purchases in Beijing has become more widespread. Co-branded Card (/) is a new tool in the recent years. That is a credit card issued by banks in conjunction with airlines, telecommunication companies, hotel booking agencies and shopping malls. Consumers can get freebies and enjoy privileges from both the banks and the co-branded partners. In addition, magazines or books with coupons and magazines with free gifts such as trial-size perfume and cosmetic, coin purse and cosmetic bag attached are prevalent, especially among youngsters.
Here is one of the typical cases of deployment of successful sales promotion tools in Beijing. In 2002, one of P&Gs leading hair care brand, Rejoice, launched a new type of shampoo with a series of marketing tactics and sales promotion tools. One of them was an on-site trial campaign held at selected hypermarkets. consumers needed to buy the new shampoo. To take part in the on-site trial,
Professional hair stylists helped the
participants wash their hair with the new shampoo and then created a natural hair style. The participants then needed to imitate the demonstrated advertisement in front of the video camera. The committee of judges would then select the winner from the participants, according to their hair quality and the hair style, to get the grand prize. All the participants
would get a trial package of hair conditioner and a copy of the edited activity video as souvenirs. People participated in the campaign because of the unique blend of fun,
experience and the prize. During the promotion period, stream of people were appeared
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in many hypermarkets. The overall sales volume exceeded prior expectation, and some hypermarkets even temporarily encountered out of stock problem with the Rejoice shampoo products. According to overall statistical figures obtained from all participated
hypermarkets in 10 selected cities (including Beijing) in mainland China, sales volume per day of Rejoice shampoo products during the promotion period was triple of the same period in the past and the market share experienced a significant increase.
Similar to Hong Kong, there are relatively more sales promotion tools for mass products, such as goods in supermarkets, than for luxury products or high-end brands, such as jewelry, in Beijing. The competition among the mass products is more intense as the difference in quality and price between the mass products are generally narrower. As such, sales
promotion tools, such as discount and gift, always play a significant role to consumers of mass products in making a purchase decision. In some shopping malls in Beijing, discount is
offered throughout the whole year. Also, in some supermarkets, convenience stores and health and beauty retail stores, deployment of sales promotion tools depends on the sales price and promotion tools deployed by the corresponding products in their competitors. Compared to Hong Kong, the wordings on presentation of offering discount in Beijing are always exaggerated to draw consumers attention, such as spend $100, get $1000. But slogans as such as sometimes misleading in which the $1000 may be in form of $10 coupons, each only to be redeemed with purchase of $100 or more. As such, a consumer would have to spend $10,000 more in order to fully redeem the $1,000 value. Also, many
consumers in Beijing realized that retail prices were always marked up substantially before price discounts were given. Comparatively, the goods in Hong Kong are relatively in rock bottom price and the discounts are more realistic and trust worthy. For luxury products or
high-end brands in Beijing, discount is rarely offered while free premium usually limited
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edition is relatively more common.
Rather than price-oriented tools, pro-bono marketing
and those creating unique or distinctive meaning, such as sponsorship to a well-wishing organization or event, holding a charity event, and endorsement of an honorable dignitary to be spokesperson, are more commonly used for luxury products. The effects of such
promotion tools are not just instant but would remain for a longer term supporting the brand building efforts.
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Findings in Beijing
(I) Interest level towards sales promotion tools in general
Similar to Hong Kong consumers, Beijing consumers showed their highest interest level towards direct price-off, with average interest score of 4.6. Apart from direct price-off,
buy-one-get-one-free offer (3.5), coupon (3.4), bonus pack / discount for a package (3.4) and free sample (3.4) were preferred by Beijing consumers. In contrast, contest,
game and sweepstake (2.1), stamp redemption (2.2) and patronage rewards from credit card (2.6) were less chosen tools by Hong Kong consumers among the listed tools. Fig. 11: Interest level towards sales promotion tools in general
Direct price-off / discounts Buy one get one free Coupons Bonus pack / dicsounts for a package Free samples Free premiums / gifts / advertising specialities Membership programme Joint / tie-in promotion Patronage rewards from credit cards Stamp redemption Contests, games and sweepstakes 0 1 2
4.6 3.5 3.4 3.4 3.4 3.2 3.0 2.9 2.6 2.2 2.1
3 4 5
S4: Please use a 5-point scale to show your interest level towards the sales promotion tools in general, where 1: not interested at all; 5: very interested Base: 220
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(II) Retail Purchasing Pattern 1. Frequency of purchase

82% of shoppers at convenience stores and 79% of shoppers at supermarkets stated that they made purchases at least once per week. 55% of shoppers at health and beauty retail For retail shops selling clothing, footwear 78%
stores made purchases at least once per month.
and allied products, two-thirds of shoppers made purchases at least once per month.
of consumers of home appliances / personal electronics made purchase at least once per year, while half of shoppers at jewelry and watches stores made purchase once per 2 or more years. Fig. 12: Retail purchasing pattern: Frequency of purchase at different core retail categories
A. Supermarkets
Everyday 4-6 times per week 2-3 times per week Once a week Once per 2-3 weeks Once per month Less than once per month 3.3% 0.5% 0% 10% 20% 30% 40% 50% 17.4% 0.5% 7.1% 26.6% 44.6%
Everyday 4-6 times per week 2-3 times per week Once a week Once per 2-3 weeks Once per month Less than once per month 0% 3.1% 3.1% 10% 20% 30% 40% 50% 15.4% 12.3% 12.3% 12.3% 41.5%
A1. How frequent do you purchase at supermarkets? Base: 184
B1. How frequent do you purchase at convenience stores? Base: 65
C. Retail shops selling clothing, footwear and allied products Once per half month or more frequent Once a month Once per 2 months Once per 3 months Once per 4 months or less frequent 0% 7.4% 9.3% 10% 20% 30% 40% 50% 16.7% 27.8% 38.9%

Once a month or more frequent 0.0% Once per 2-3 months 5.6%
Once per 4-6 months 0.0% Once per 7 months - 1 year Once per 2 years Once per 3 years or less frequent 0% 10% 20% 22.2% 27.8% 30% 40% 50% 44.4%
C1. How frequent do you purchase at retail shops selling clothing, footwear and allied products? Base: 54
D1. How frequent do you purchase at jewelry and watches retail stores? Base: less than 20
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E. Retail stores of home appliances / personal electronics Once a month or more frequent Once per 2-3 months Once per 4-6 months Once per 7 months - 1 year Once per 2 years or less frequent 0% 10% 20% 21.9% 30% 40% 50% 0.0% 18.8% 18.8% 40.6%

Once a week or more frequent Once per 2-3 weeks Once per 1 month Once per 2 months Once per 3 months Once for more than 3 months 0% 6.5% 10% 20% 30% 40% 50% 19.4% 19.4% 6.5% 16.1% 32.3%
E1. How frequent do you purchase at retail stores of home appliances / personal electronics?
F1. How frequent do you purchase at health and beauty retail stores? Base: 31
2. Spending
Consumers of convenience stores and supermarkets spent an average of RMB 25 and RMB 104 for each visit, respectively. Shoppers at health and beauty stores made an average expenditure of RMB 185 per month. At shops of clothing, footwear and allied products, Shoppers of stores of home
consumers spent an average of RMB 869 in each quarter.
appliances / personal electronics, and jewelry and watches spent an average of RMB 2,954 and RMB 4,598 respectively, at their most recent purchases.
Fig. 13. Retail purchasing pattern: Average spending A. At supermarkets B. At convenience stores C. At shops of clothing, footwear and allied products D. At jewelry and watches stores E. At stores of home appliances / personal electronics F. At health and beauty stores RMB 4,598 (most recent purchase) RMB 2,954 (most recent purchase) RMB 185 (per month) RMB 104 (per transaction) RMB 25 (per transaction) RMB 869 (per season)
A2-F2. Average spending Base: 184 (A), 65 (B), 54 (C), less than 20 (D), 32 (E), 31 (F)
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3. Payment method
Credit card was a very prevalent payment method in Beijing recently.
It became the
most widely used payment method at shops of jewelry and watches (77.8%), home appliances / personal electronics (62.5%) and clothing, footwear and allied products (61.1%). Even at health and beauty stores, over half of consumers (51.6%) made payment by credit card. For convenience stores (84.6%) and supermarkets (48.9%), cash still was the most
common payment method. Besides, more than one-tenth of shoppers of home appliances / personal electronics (12.5%), and jewelry and watches (11.1%) made purchases via debit card. Fig. 14. Retail purchasing pattern: Payment method
A. Supermarkets
Shopping Debit card, card, 9.2% 4.9%
Transportati on card 6.2% Credit card 9.2%
Cash, 48.9%
Credit card, 37.0%

A3. Which payment method do you use most frequently at supermarkets? Base: 184
Cash 84.6%
B3. Which payment method do you use most frequently at convenience stores? Base: 65

Shopping Debit card, card, 5.6% 9.3% Cash, 24.1% Transportati on card, 0.0%

Cash, 11.1%
Debit card, 11.1%
Credit card, 61.1% C3. Which payment method do you use most frequently at retail shops selling clothing, footwear and allied products? Base: 54
Credit card, 77.8%

D3. Which payment method do you use most frequently at jewelry and watches retail stores? Base: less than 20
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E. Retail stores of home appliances / personal electronics Debit card, 12.5% Cash, 25.0%

Debit card, 6.5% Cash, 41.9% Credit card, 51.6%
F3. Which payment method do you use most frequently at health and beauty retail stores? Base: 31
Credit card, 62.5%
E3. Which payment method do you use most frequently at retail stores of home appliances / personal electronics? Base: 32
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(III) Usage of and Perception towards Sales Promotion Tools
1. Frequency of enjoying sales promotion
Direct discount was the most frequently used sales promotion tool by consumers in the six core retail categories. It was especially popular at supermarkets, shops of clothing, footwear and allied products, shops of home appliances / personal electronics and health and beauty stores.
Apart
from
direct
discount,
bonus
pack
discount
for
package,
buy-one-get-one-free offer and free sample were also popular tools that consumers make use of at supermarkets and convenience stores. For shops of clothing, footwear and allied products, bonus pack / discount for a package and membership programme were commonly used by shoppers. Shoppers of jewelry and watches relatively more frequently
used coupon and bonus pack / discount for a package. Shoppers were more likely to use coupon, patronage rewards from credit card and free premium at stores of home appliances / personal electronics. As for health and beauty stores, free premium, bonus
pack / discount for a package and free sample were frequently enjoyed by consumers.
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Fig. 15. Frequency of enjoying sales promotion at different core retail categories
A. Supermarkets
Direct price-off / discounts Coupons Bonus pack . discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Free samples
74.5% 21.2% 39.7% 32.1% 27.7% 19.0% 6.5% 15.2% 7.1% 9.2% 29.9% 21.2% 34.2%
0% 10% 20% 30% 40%
19.0% 51.1% 34.8% 36.4% 42.4% 25.5% 31.5% 29.9% 44.6% 78.3% 83.7%
6.5%
27.7%
36.4%
25.5% 22.3% 30.4%

50% 60% 70%
44.6% 56.5% 35.3%

80% 90% 100%
Always / Everytime
Sometimes
Never / Seldom
A4. How often do you enjoy sales promotion at supermarket? Base: 184
Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Free samples
50.8% 21.5% 30.8% 29.2% 21.5% 15.4% 6.2% 15.4% 6.2%7.7% 16.9% 10.8% 12.3% 15.4% 27.7%
20% 30% 40% 50%
29.2% 63.1% 24.6% 41.5% 33.8% 44.6%
20.0%
15.4%
29.2% 44.6% 55.4% 78.5%
29.2%
86.2% 70.8% 73.8% 49.2%

60% 70% 80% 90% 100%
23.1%
0% 10%
Always / Everytime
Sometimes
Never / Seldom
B4. How often do you enjoy sales promotion at convenience stores? Base: 65
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Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion
74.1% 18.5% 27.8% 13.0% 5.6% 14.8% 9.3% 22.2% 94.4% 31.5% 27.8% 31.5% 79.6% 68.5% 85.2% 24.1% 24.1% 57.4% 48.1% 55.6%
22.2%
3.7%
Stamp redemption 1.9%13.0% Contests, games and sweepstakes 3.7% 1.9% Membership programme Patronage rewards from credit cards Free samples
24.1% 16.7% N/A

0% 10% 20% 30%
44.4% 55.6%
40%
50%
60%
70%
80%
90%
100%
Always / Everytime
Sometimes
Never / Seldom
C4. How often do you enjoy sales promotion at retail shops selling clothing, footwear and allied products? Base: 54

Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free
50.0% 27.8% 22.2% 16.7% 22.2% 22.2% 11.1% 22.2% 16.7%
27.8% 61.1% 55.6% 66.7% 72.2% 77.8% 83.3% 88.9% 77.8% 72.2%
22.2%
Free premiums / gifts / advertising specialities 5.6% Joint / tie-in promotion
Stamp redemption 5.6% 11.1%
5.6% Contests, games and sweepstakes 5.6%

Membership programme Patronage rewards from credit cards Free samples
11.1% 11.1% 16.7% N/A

0% 10% 20% 30% 40% 50%
11.1%
60%
70%
80%
90%
100%
Always / Everytime
Sometimes
Never / Seldom
D4. How often do you enjoy sales promotion at jewelry and watches retail stores? Base: less than 20
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Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities
75.0% 37.5% 18.8% 18.8% 25.0% 12.5% 21.9% 25.0% N/A

0% 10% 20% 30% 40% 50% 60% 70%
6.3% 50.0% 62.5% 68.8%
18.8%
12.5% 18.8%
12.5% 31.3% 84.4%
43.8% 81.3% 84.4%
Joint / tie-in promotion 6.3% 9.4% Stamp redemption 6.3%
Contests, games and sweepstakes 3.1% 12.5% Membership programme Patronage rewards from credit cards Free samples
9.4% 9.4%
68.8% 65.6%
80%
90%
100%
Always / Everytime
Sometimes
Never / Seldom
E4. How often do you enjoy sales promotion at retail stores of home appliances / personal electronics? Base: 32

Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption3.2% Contests, games and sweepstakes Membership programme Patronage rewards from credit cards3.2% Free samples
64.5% 22.6% 38.7% 38.7% 45.2% 22.6% 38.7% 22.6% 25.8% 32.3% 38.7%
0% 10% 20% 30% 40% 50%
19.4% 38.7% 38.7% 41.9% 32.3% 41.9% 58.1% 77.4% 32.3% 64.5% 41.9%
60% 70% 80%
16.1% 22.6% 19.4% 22.6%
38.7%
35.5%
41.9% 19.4%
90% 100%
Always / Everytime
Sometimes
Never / Seldom
F4. How often do you enjoy sales promotion at health and beauty retail stores? Base: 31
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2. Interest level towards sales promotion tools

For the six core retail categories, direct discount was the sales promotion tool most preferred by consumers, with an average score of 4.2 to 4.7. It was popular, especially among shoppers of supermarkets (4.7), shops selling clothing, footwear and allied products (4.7), and home appliances / personal electronics stores (4.6).
At supermarkets, convenience stores, shops of clothing, footwear and allied products, and health and beauty stores, coupon (3.2 to 3.8), buy-one-get-one-free offer (3.3 to 3.8) and bonus pack / discount for a package (3.2 to 3.6) were popular tools, just follow direct price-off. In addition, free premium was also a popular tool among shoppers of
supermarkets (3.4) and convenience stores (3.3). On the other hand, shoppers at jewelry and watches stores liked coupon (3.2), buy-one-get-one-free offer (2.7) and patronage rewards from credit card (2.7). At stores of home appliances / personal electronics,
coupon (3.3) and free premium (3.3) were welcomed by shoppers.
As similar to Hong Kong, Beijing consumers less preferred contest, game and sweepstake in six core retail categories, with average scores ranged from 1.6 to 2.2.
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Fig. 16. Interest level towards sales promotion tools

A. Supermarkets
Direct price-off / discounts Coupons Bonus pack . discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Free samples
0 1 2 3
4.7 3.5 3.4 3.5 3.4 3.0 2.2 2.1 2.9 2.6 3.5
4 5
A5: Please use a 5-point scale to show your interest level towards the sales promotion tools at supermarkets. (1 represents totally disagree and 5 represents totally agree) Base: 184
0 1 2 3 2.3 2.2 2.8 2.7 3.2 4 5 2.9 3.3 3.5 3.5 3.7 4.5
B5: Please use a 5-point scale to show your interest level towards the sales promotion tools at convenience stores.. (1 represents totally disagree and 5 represents totally agree) Base: 65
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0
4.7 3.5 3.2 3.3 2.7 2.5 1.9 1.7 2.9 2.8 N/A
1 2 3 4 5
C5: Please use a 5-point scale to show your interest level towards the sales promotion tools at retail shops selling clothing, footwear and allied products.. (1 represents totally disagree and 5 represents totally agree) Base: 54

Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Free samples 0 1.8 1.6 2.1 2.7 2.2 2.6 2.7 2.6 3.2 4.2
N/A
1 2 3 4 5
D5: Please use a 5-point scale to show your interest level towards the sales promotion tools at jewelry and watches retail stores.. (1 represents totally disagree and 5 represents totally agree) Base: less than 20
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0
4.6 3.3 2.7 2.9 3.3 2.5 1.9 2.0 2.5 2.8 N/A
1 2 3 4 5
E5: Please use a 5-point scale to show your interest level towards the sales promotion tools at retail stores of home appliances / personal electronics.. (1 represents totally disagree and 5 represents totally agree) Base: 32

Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Free samples 0 1 2 3 2.4 3.3 4 5 2.1 2.8 2.4 3.0 3.3 3.8 3.6 3.8 4.3
F5: Please use a 5-point scale to show your interest level towards the sales promotion tools at health and beauty retail stores.. (1 represents totally disagree and 5 represents totally agree) Base: 31
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(IV) Behavioral Responses towards Sales Promotion Tools
1. Increase the quantity of usually-purchased products
For the six core retail categories, direct price-off was the most effective tool to make consumers purchasing more quantities of products which they usually buy (3.4 to 4.4).
Overall speaking, coupon (2.3 to 3.5), bonus pack / discount for a package (2.4 to 3.5) and buy-one-get-one-free offer (2.3 to 3.7) were also effective tools to motivate consumers of the six core retail categories to purchase more in quantity. In addition, free premium was also an effective tool among shoppers of jewelry and watches stores (2.6) and home appliances / personal electronics stores (2.9).
Obviously, the scores on sales promotion tools given by shoppers of jewelry and watches were comparatively smaller. This revealed that Beijing shoppers of jewelry and watches
stores were least influenced by sales promotion tools among the six core retail categories to purchase more in quantity.
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Fig. 17. Increase the quantity of usually-purchased products under influence of sales promotion tools
A. Supermarkets
Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Free samples 0 1 2 3
2.6 3.4 2.3 2.1 3.0 2.9 3.5 3.4 3.4 3.4 4.4
A6: What is your level of agreement on the sales promotion tool induce you to increase the quantity of usually-purchase product at supermarkets? (1 represents totally disagree and 5 represents totally agree) Base: 184
Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Free samples 2.3 2.1 2.7 2.6 3.2 3.1 2.9 3.2 3.4 3.6 3.9
B6: What is your level of agreement on the sales promotion tool induce you to increase the quantity of usually-purchase product at convenience stores? (1 represents totally disagree and 5 represents totally agree) Base: 65
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Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Free samples N/A 2.1 1.9 2.9 2.8 2.6 2.9 3.4 3.5 3.3 4.4
C6: What is your level of agreement on the sales promotion tool induce you to increase the quantity of usually-purchase product at retail shops selling clothing, footwear and allied products? (1 represents totally disagree and 5 represents totally agree) Base: 54

D6: What is your level of agreement on the sales promotion tool induce you to increase the quantity of usually-purchase product at jewelry and watches retail stores? (1 represents totally disagree and 5 represents totally agree) Base: less than 20
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Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Free samples 0 N/A 1 2 3 4 5 1.8 2.5 2.8 2.1 2.4 2.8 2.9 2.9 3.1 3.9
E6: What is your level of agreement on the sales promotion tool induce you to increase the quantity of usually-purchase product at retail stores of home appliances / personal electronics? (1 represents totally disagree and 5 represents totally agree) Base: 32

Direct price-off / discounts Coupons Bonus pack / dicsounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Free samples 2.3 3.0 2.3 2.1 2.7 2.7 3.4 3.5 3.5 3.7 4.1
F6: What is your level of agreement on the sales promotion tool induce you to increase the quantity of usually-purchase product at health and beauty retail stores? (1 represents totally disagree and 5 represents totally agree) Base: 31
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2. Switch to other brands which consumers do not regularly buy
Again, direct price-off from retail price was the most effective tool to induce consumers of the six core retail categories to buy other brands which they do not regularly buy (3.9 to 4.3).
As similar to the cases of behavioral responses of purchasing more in quantity, coupon (3.1 to 3.4), bonus pack / discount for a package (2.7 to 3.3) and buy-one-get-one-free offer (2.7 to 3.4) were also effective tools leading consumers to brand switching. In
addition, free premium (2.9 to 3.2) was effective among shoppers of supermarkets (3.2), convenience store (3.2) and home appliances / personal electronics stores (2.9). And free
sample could somewhat make consumers to switch brands when shopping at supermarkets (3.3) and convenience stores (3.2).
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Fig. 18. Switch to other brands which consumers do not regularly buy under influence of sales promotion tools
A. Supermarkets
A7: What is your level of agreement on the sales promotion tool induce you to switch to other brands which do not regularly buy at supermarkets? (1 represents totally disagree and 5 represents totally agree) Base: 184
B7: What is your level of agreement on the sales promotion tool induce you to switch to other brands which do not regularly buy at convenience stores? (1 represents totally disagree and 5 represents totally agree) Base: 65
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C7: What is your level of agreement on the sales promotion tool induce you to switch to other brands which do not regularly buy at retail shops selling clothing, footwear and allied products? (1 represents totally disagree and 5 represents totally agree) Base: 54

D7: What is your level of agreement on the sales promotion tool induce you to switch to other brands which do not regularly buy at jewelry and watches retail stores? (1 represents totally disagree and 5 represents totally agree) Base: less than 20
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E7: What is your level of agreement on the sales promotion tool induce you to switch to other brands which do not regularly buy at retail stores of home appliances / personal electronics? (1 represents totally disagree and 5 represents totally agree) Base: 32

F7: What is your level of agreement on the sales promotion tool induce you to switch to other brands which do not regularly buy at health and beauty retail stores? (1 represents totally disagree and 5 represents totally agree) Base: 31
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3. Purchase additional products which consumers have not planned to buy originally
From the perspective of leading consumers to buy additional products which do not include in original plan, direct price-off (mean=3.5 to 4.3) was again the most effective tool for the six core retail categories.
Following direct price-off, coupon (mean=2.5 to 3.4), buy-one-get-one-free offer (mean=2.4 to 3.5) and bonus pack / discount for a package (mean=2.3 to 3.4) were effective to encourage consumers to buy additional products. In addition, free sample
were effective among shoppers of supermarkets (mean=3.2) and convenience stores (mean=3.1). For home appliances / personal electronics stores, free premium was also
effective to motivate consumers to purchase additional products (mean=2.7).
As similar to the case of the influence on purchasing more quantities of usually-buy products, the scores given by consumers of jewelry and watches were obviously smaller in overall. This revealed that consumers of jewelry and watches in Beijing were least
influenced by sales promotion tools to make unplanned purchases.
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Fig. 19. Purchase additional products which consumers have not planned to buy originally under influence of sales promotion tools
A. Supermarkets
Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Free samples 0 1 2 3 2.5 3.2 4 5 2.1 2.8 2.3 2.7 3.2 3.1 3.2 3.0 4.2
A8: What is your level of agreement on the sales promotion tool induce you to purchase some additional products which are not planned to buy originally at supermarkets? (1 represents totally disagree and 5 represents totally agree) Base: 184
Direct price-off / discounts Coupons Bonus pack / discounts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Free samples 0 1 2 3 2.3 2.2 2.6 2.4 3.1 4 5 2.7 3.0 3.2 3.1 3.4 4.1
B8: What is your level of agreement on the sales promotion tool induce you to purchase some additional products which are not planned to buy originally at convenience stores? (1 represents totally disagree and 5 represents totally agree) Base: 65
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C8. Clothing, footwear and allied products

C8: What is your level of agreement on the sales promotion tool induce you to purchase some additional products which are not planned to buy originally at retail shops selling clothing, footwear and allied products? (1 represents totally disagree and 5 represents totally agree) Base: 54
D8. Jewelry and watches

D8: What is your level of agreement on the sales promotion tool induce you to purchase some additional products which are not planned to buy originally at jewelry and watches retail stores? (1 represents totally disagree and 5 represents totally agree) Base: less than 20
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E8. Home appliances / personal electronics

Direct price-off / discounts Coupons Bonus pack / disocunts for a package Buy one get one free Free premiums / gifts / advertising specialities Joint / tie-in promotion Stamp redemption Contests, games and sweepstakes Membership programme Patronage rewards from credit cards Free samples N/A 2.0 1.9 2.3 2.4 2.3 2.6 2.7 2.7 3.0 3.8
E8: What is your level of agreement on the sales promotion tool induce you to purchase some additional products which are not planned to buy originally y at retail stores of home appliances / personal electronics? (1 represents totally disagree and 5 represents totally agree) Base: 32
F8. Personal wellness / personal care products

F8: What is your level of agreement on the sales promotion tool induce you to purchase some additional products which are not planned to buy originally at health and beauty retail stores? (1 represents totally disagree and 5 represents totally agree) Base: 31
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MVA Perspectives
1.
From the survey results in Hong Kong and Beijing, as well as other research findings, direct discount is well-documented to be the sales promotion tool most preferred in general by consumers, most frequently used in reality and most effective in influencing consumers self-proclaimed purchasing behaviors. Yet, it should be noted that both brand values and brand equities, both of which are image-driven, may be sacrificed or comprised if frequent and perennial discounts are to be offered either by the product brands or by the retail shops. In addition, consumers may expect discounts of some sort As a result, perennial direct discount despite to come, and hence refrain from buying or hold back purchases which have undesirable impacts on turnover and sales revenues. being popular among consumers, may actually cause detrimental effects on the profit margins of both manufacturers and retailers, as the listed regular prices are somewhat compromised and become inefficient. discount. Furthermore, some respondents in both Hong Kong and Beijing point out that certain retailers may mark up the retail price first and then They feel unlike for this kind of behavior. On the other hand, consumers The above issues should be carefully may focus more on price reduction and jet-so rather than the product itself, rendering the product claims and functions less important. considered when deploying long-term, perennial discounts as sales promotion tool.
2.
It is not surprising that contest, game and sweepstake were rated by Hong Kong and Beijing consumers to be the tool the least preferred, the least frequently used and the least effective in inducing purchase behaviors. They are used to add fun and excitement to the shopping experience, but the degree of consumers involvement is much larger than with other tools, and the chance of actually winning is generally perceived to be slim. Given such consumer skepticism, it is advisable that more creative and attractive design in deploying contest, game and sweepstake as sales promotion device, should be considered in order to encourage more active consumers participations.
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3.
According to the survey findings in Hong Kong, couponing was preferred and perceived to be effective by consumers in inducing consumption behaviors in Hong Kong. However, it was not among the top 3 frequently used tools in the six core retail categories in the survey. Especially at supermarkets and jewelry and watches stores, coupon was not commonly used. It would be an opportunity for retailers particularly those selling fast moving consumer goods (FMCG) and personal services to consider promoting their products more with coupons with the deployment of convenient and handy mechanism in application such as mobile SMS coupon, or on-demand coupons for consumers to request when they need them, saving the hassles of clipping and storing paper coupons in wallets or elsewhere.
4.
For the retail markets in both Hong Kong and Beijing, fewer sales promotion tools are deployed for luxury brands or products than mass brands or products in general. The types of sales promotion tools deployed by the luxury versus the mass ones are quite different too. The perceived differences in quality and price among the mass products Also, consumers of As such, price-oriented are relatively slimmer, rendering keener competition among them. mass brands or mass products are usually more price-oriented. free sample are commonly used tools for mass products. products.
tools such as discount, bonus pack / package price, free premium, stamp redemption and In contrast, valuable premium gifts, charity events and value-adding services are usually deployed for luxury brands or In certain occasions, special auctioning of limited-edition items of luxury brands or products for charity or some special causes would be held to promote the brands image, vis--vis the target consumers needs and social status. From the survey findings, it has shown that there are differences in usage habit, demand, preference and behavioral responses towards different sale promotion tools in different core retail categories even in the two leading Chinese metropolis. Actually, consumers from different cities have different habits and demands. It is crucial for retailers to have a thorough understanding on local consumers needs and market trends before deploying any sales promotion tools, tailoring and offering corresponding right sales promotion tools,
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5.
in order to enhance effectiveness of the tools, generate higher sales revenues and minimize the business risk.
6.
Sales promotion plays an important role for producing quick and short-term increases in sales. Consumers are always attracted by various sales promotion tools to try a new product and make an initial purchase. However, the effects induced by sales promotion tools need to be sustained by the actual performance of the products, which should be the ultimate focus to retain loyal consumers so as to generate stable sales revenues in a longer term.
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References
Campbell, L., & Diamond, W, D. (1990). Framing and sales promotion: The characteristics of a good deal. Journal of Customer Marketing, 7(4), 25-31. Dommermuth, W, P (1989). Promotion: Analysis, creativity and strategy. Boston: PWS-Kent . Publishing Company. Haugh, L.J. (1983), Defining and redefining, Advertising Age, February 14: p. 44. Lee, C. W. (2002). Sales promotions as strategic communication: The case of Singapore. The
Journal of Product and Brand management, 11(2/3), 103-114.

Ong, S.B. (1999), Determinants of Purchase Intentions and Stock-piling Tendency of Bonus Packs, American Business Review, January, 57-64. Shimp, T, A. (1993). Promotion management and marketing communications. Chicago: Dryden Press. Tai, Susan H C, Tam, Jackie L M. (1996), A Comparative Study of Chinese Consumers in Asian Markets: A Lifestyle Analysis, Journal of International Consumer Marketing, 9 (1), 25. (2006) (Review of the Literature about Sales Promotion and Brand Equity)
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Appendix A Profile of respondents

Hong Kong respondents:
Gender
Percentage Male Female 46.0% 54.0%
Age
Percentage 18-29 30-39 40-49 50-59 60-69 22.4% 21.1% 24.1% 20.7% 11.8%
Living status
Percentage Single, live with family members Single, live with friends Single, live alone Married, without child Married, with child Others 40.1% 2.1% 5.1% 9.3% 43.5% 0.0%
Education level
Percentage Primary or below Secondary (F.5 or below) Matriculation (F.6-7) Tertiary (non-degree course) Tertiary (degree course)
* 0.4% of respondents refused to answer.
10.5% 34.6% 10.5% 13.1% 30.8%
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Occupation
Percentage Managers and administrators Professionals Associate professionals Clerks Service workers and shop sales workers Skilled agricultural and fishery workers Craft and related workers Plant and machine operators and assemblers Elementary occupations Students Homemakers Retired persons Unemployed / job-seeking persons Others
8.0% 13.9% 5.9% 14.3% 7.6% 0.4% 1.3% 3.0% 5.5% 8.0% 16.9% 9.3% 5.5% 0.0%
Average monthly personal income

Percentage No income Below HK$5,000 HK$5,000-9,999 HK$10,000-14,999 HK$15,000-19,999 HK$20,000-24,999 HK$25,000-29,999 HK$30,000-39,999 HK$40,000-49,999 HK$50,000-59,999 HK$60,0000 or above Mean
22.8% 14.3% 13.9% 15.6% 12.7% 7.6% 1.7% 4.6% 1.3% 0.4% 0.8% HK$10,881
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Average monthly household income

Percentage No income Below HK$5,000 HK$5,000-9,999 HK$10,000-14,999 HK$15,000-19,999 HK$20,000-24,999 HK$25,000-29,999 HK$30,000-39,999 HK$40,000-49,999 HK$50,000-59,999 HK$60,0000 or above Mean
0.0% 0.4% 6.3% 9.7% 19.0% 13.1% 10.1% 12.2% 7.6% 3.0% 11.4% HK$25,306
No. of household members

Percentage 1 2 3 4 5 6 7 8 Mean 5.1% 15.2% 22.8% 36.7% 13.5% 5.9% 0.4% 0.4% 3.6
Domestic helper and her role

Percentage Yes No 9.7% 90.3%
Percentage Obey order Decide herself 65.2% 34.8%
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Buy products with sales promotion tools in the past 3 months

Percentage a. Supermarket b. Convenience store c. Clothing, footwear and allied products d. Jewellery and watches e. Home appliances / personal electronics f. Health and beauty products 83.1% 55.3% 39.7% 7.6% 18.1% 31.2%
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Beijing respondents:
Gender
Percentage Male Female 50.5% 49.5%
Age
Percentage 18-29 30-39 40-49 50-59 60-69 28.6% 21.8% 21.4% 18.6% 9.5%
Living status
Percentage Single, live with family members Single, live with friends Single, live alone Married, without child Married, with child 18.2% 10.9% 7.3% 11.8% 51.8%
Education level
Percentage Primary or below Middle school High school Junior college (non-degree course) University (degree course) 5.0% 11.8% 17.3% 27.3% 38.6%
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Occupation
Percentage Managers and administrators Professionals Associate professionals Clerks Service workers and shop sales workers Skilled agricultural and fishery workers Craft and related workers Plant and machine operators and assemblers Elementary occupations Students Homemakers Retired persons Unemployed / job-seeking persons 11.4% 22.7% 5.9% 12.3% 5.5% 0.0% 1.8% 1.8% 9.1% 5.9% 0.9% 21.8% 0.9%
Average monthly personal income

Percentage No income Below RMB$2,000 RMB $2,000-3,999 RMB $4,000-5,999 RMB $6,000-7,999 RMB $8,000-9,999 RMB $10,000-14,999 RMB $15,000-19,999 RMB $20,0000 or above Mean 7.7% 13.2% 37.7% 24.1% 9.5% 4.5% 1.7% 1.4% 0.0% RMB $3,823
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Average monthly household income

Percentage No income Below RMB$2,000 RMB $2,000-3,999 RMB $4,000-5,999 RMB $6,000-7,999 RMB $8,000-9,999 RMB $10,000-14,999 RMB $15,000-19,999 RMB $20,0000 or above Mean 0.0% 5.0% 8.2% 21.4% 22.7% 20.9% 12.3% 6.8% 2.7% RMB $7,795
No. of household members

Percentage 1 2 3 4 5 6 Mean 8.6% 24.1% 51.8% 8.6% 5.9% 0.9% 3.60
Domestic helper and her role

Percentage Yes No 4.1% 95.9%
Percentage Obey order Decide herself 66.7% 33.3%
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Buy products with sales promotion tools in the past 3 months

Percentage a. Supermarket b. Convenience store c. Clothing, footwear and allied products d. Jewellery and watches e. Home appliances / personal electronics f. Health and beauty products 83.6% 29.5% 24.5% 8.2% 14.5% 14.1%
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Sales Promotion Tools in Retail Sector in HK BJ

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Sales Promotion Tools in Retail Sector in Hong Kong and Beijing

LIST OF CONTENTS Page

References Appendix A - Profile of Survey Respondents

3. retail shops selling clothing, footwear and allied products;

4. Jewelry and watches retail stores;

5. retail shops selling home appliances or personal electronics; and

6. health and beauty retail stores.

The key findings for Hong Kong are listed as below:

health and beauty products and home appliances / personal electronics.

additional unplanned products.

The key findings for Beijing are listed as below:

Consumers from different cities have different habits and demands.

Study Objectives and Scope

Research Design and Methodology

Sales Promotion Tools

History of sales promotion tools

that brand for its photo-taking promotion.

The shop, on the other hand, thus became

promotion was just similar to that used on advertising.

Categories of sales promotion tools

sales promotion, monetary sales promotion and nonmonetary sales promotion.

Classifications Economic incentive Psychological incentive

Source: Dommermuth (1989)

Source: Shimp (1990)

Source: Campbell and Diamond (1990)

Purposes of sales promotion tools

consumers purchases of new products.

Hong Kong in a Glance

entrance to the mainland's massive market, as well as a global business platform.

Retail market overview

such nicknames as Shoppers' Paradise and Gourmet Paradise.

in 2010, Hong Kongs economy should undertake a further rebound in 2010.

Deployment of sales promotion tools

In addition, endorsement from celebrities and stars is also very common.

Existing stock volume is one of the important factors of

Findings in Hong Kong

Fig. 1: Interest level towards sales promotion tools in general

(II) Retail Purchasing Pattern 1. Frequency of purchase

A1. How frequent do you purchase at supermarkets? Base: 197

B1. How frequent do you purchase at convenience stores? Base: 131

Once per 1 month

consumers also used electronic payment methods during shopping.

Fig. 4. Retail purchasing pattern: Payment method

D. Jewelry and watches retail stores EPS, 11.1% Cash, 11.1%

Credit card, 52.1%

Credit card, 77.8%

F. Health and beauty retail stores

Credit card, 76.7%

(III) Usage of and Perception towards Sales Promotion Tools

1. Frequency of enjoying sales promotion

Among the six

for each type of retail stores were listed below.

and free sample were comparatively frequently used by consumers.

Fig. 5. Frequency of enjoying sales promotion at different core retail categories

38.1% 29.4% 28.9%

Membership programme 6.9%

C. Retail shops selling clothing, footwear and allied products

18.1% 2.1% 27.7% 42.6%

24.5% 29.8% 9.6% 11.7% N/A

D. Jewelry and watches retail stores

50.0% 61.1% 72.2% 61.1%

5.6% Bonus pack / discounts for a package 5.6%