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Consumer Promotions
Chapter Overview
Types of consumer promotions Planning for consumer promotions Business-to-business promotions International consumer promotions
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Discussion Slide
11
Coupons
How often do you use coupons? What products do you tend to use coupons to purchase? Will a coupon affect which brand you buy? Why do you think companies offer so many coupons to consumers?
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FIGURE
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Coupons Premiums Contests and sweepstakes Refunds and rebates Sampling Bonus packs Price-offs
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Source: The Second Annual Survey of Consumer Preferences for Product Sampling, Santella & Associates (Http://www.santella.com/marketing.htm).
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Disposable diapers Detergents Meal starters Dough products (refrigerated) Cereal Wrapping materials, bags Oral hygiene products Household cleaners
Source: AC Nielson Scantrack, Santella & Associates
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FIGURE
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Types of Coupons
Instant redemption Scannerdelivered Cross-ruffing Response offer U-pons
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Avg. Redemption Rate 39.3% 17.2% 17.1% 10.2% 7.8% 5.8% 4.7% 3.5% 3.1% 1.3%
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STOP
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Types of Premiums
Free-in-the-mail In- or on-package Store or manufacturer Self-liquidating
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Fisher Boy
Free, in-the-mail premium
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FIGURE
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Match the premium to the target market. Carefully select the premiums.
(Avoid fads, try for exclusivity)
Pick a premium that reinforces the firms product and image. Integrate the premium with other IMC tools.
(Especially advertising and POP displays)
STOP
Sweepstakes Builder
Http://www.sweepstakesbuil der.com
ADPAC Corporation
Http://www.adpaccorp.com
How can these firms assist in the development of a contest or sweepstake? What other promotional services can they provide? What are the advantages and disadvantages of using one firm for multiple or all of the consumer promotions?
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FIGURE
Types of Sampling
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In-store distribution Direct sampling Response sampling Cross-ruff sampling Media sampling Professional sampling Selective sampling
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Meat product A Meat product B Meat product C Bread product Biscuit product A Biscuit product B
Source: Michelle Lawson, Dalton McGuinness and Don Esslemont, The Effect of In-Store Sampling on the Sale of Food Products, Marketing Bulletin, 1990, Vol. 1, pp 1-6. 11-21
Product
Previous 4 week
Sampling week
Following 4 weeks
Source: Michelle Lawson, Dalton McGuinness and Don Esslemont, The Effect of InStore Sampling on the Sale of Food Products, Marketing Bulletin, 1990, Vol. 1, pp 16. 11-22
Discussion Slide
Sampling
How effective would sampling be for the goods and services listed on the right? How would you design a sampling program that would be effective, yet not too costly? What type of consumers would you target for the sampling?
Fitness center Ice cream Dental service Clothing manufacturer Auto repair service Office supply store B-to-B consulting service B-to-B supplier of raw materials such as sugar, flour, etc. to bakeries.
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FIGURE
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Increase usage of the product Match or pre-empt competitive actions Stockpiling of product Develop customer loyalty Attract new users Encourage brand switching
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Price-Offs
Temporary reduction in price. Excellent for boosting short-term sales. Excellent for generating customer traffic. Can be implemented easily. Must be careful not to increase customer price sensitivity. Can have detrimental impact on brand and corporate image.
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Source: Studies Indicate Coupons are an Effective Promotional Tool, Santella & Associates (http://www.santella.com/coupon.htm) 11-26
Promotion Combinations
Over-lay Intra-company tie-in Inter-company tie-in
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Types of Consumers
Promotion prone consumers Brand loyal consumers Price sensitive consumers
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STOP
What type of sales promotions are offered? What do you think are the objectives of the consumer promotions? Are the promotions offered on the Web site consistent with their advertising and promotions offered at retail outlets?
Quaker State Http://www.quakerstate.com Taco Bell Http://www.tacobell.com Kraft Foods Http://www.kraft.com Jockey Http://www.jockey.com Avon Http://www.avon.com Lee Jeans Http://www.leejeans.com
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Sources: "International Coupon Trends," Direct Marketing, Volume 56, Issue 4 (August 1993), pp. 47-49; "FSI Coupon Redemption Rate for Frozen Foods," Frozen Food Age, Volume 47, Issue 3 (October 1998), p. 70.
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