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Sales Promotion

The wonders and the wounds

Promotion Mix / Communication Mix (PR)


   

Sales Promotion PR Selling Advertising


 

Below the line Above the line

Two Types of Sales Promotion


 

Consumer Promotion Trade Promotion

What do we want the consumers and trade to do?


 

Buy More Buy Now

A sales promotion should be




Temporary if not the consumers would not believe it the next time Great Value Added they should find reason to buy now and more

Trends on Sales Promotion


 

of the marketing budget is allocated to sales promotion In 1995, 51% of total adspend represents trade promotions. 24% on media spending 22% on consumer promotion Growth in the coupon segment is tremendous in aspirational markets


Americans redeem more than 7 billion coupons annually.

Why the Growth???


   

Instant results Faster implementation Measurable Relatively easy and inexpensive

The Downside of Sales Promotion


   

Brand Erosion Profitability increase is relatively low Implementation cost and problems Orients marketing managers towards short term results

What a sales promotion should be.


  

Lets go back to the basics Should hit the consumer at a particular behavioral stage Are marketing communication activities that change the price/value relationship of a product / service perceived by the target
 

Generating immediate sales Altering long term brand value

Planning Sales Promotion


   

Who is our target set of consumers? What is the reason for that behavior What is the goal of the program Is there a meaningful economics attached to sales promotion

Types of Buyers


Loyals


Buy a particular brand on a more or less consistent basis People who are loyal to the competing brand Purchase of various brands in one category

Competitive loyals


  

Switchers


Price buyers Non Users

Results that are needed .




Loyals
  

Reinforce behavior Increase consumption Change buying timing Break loyalty Encourage brand switching Persuade to buy the right brand more often Value added to make price less important Create awareness, create category worth

Competitive loyals
 

  

Switchers


Price


Non users


Types of Sales Promotions


            

Coupon Bonus Packs In pack, On pack, and Near Pack Specialty container Continuity program Refund Sweepstakes Contest Through the mail Premium Sampling Price off Trade deal Cause related promotion

Coupons


  

Clip and bring to the store to exchange Now it is phone based Induce loyalty Repeat purchase Keeps the consumers locked

Bonus Packs


Like bundle pricing but this is temporary Adds value

In Pack, On Pack Promotion




It is used to introduce new products / service Dispose of excess inventory Use excess overhead

Specialty Container


Increases products perceived value Uy tignan mo ito meron libreng pitchel

Continuity Program /Loyalty Cards

Refund / Rebate Promotion




If the product does not perform, then its money back Or consume X number of products and get Y FREE Increases consumer confidence Loyalty program

Sweepstakes


Chance game where the consumer has the chance to win something big through purchases The more purchases, the more tickets Creates loyalty

Sampling


Used when the consumer is unaware of the brand or product Product buying is prone to retail channel based trial Use when the product can be broken down into smaller dimensions

Price off promotion




 

Use for slow moving items Excess inventory Off season Dislodge competitors

Choose the right promotion for the right situation

Example
Problem
New product Consumers not loyal Competitors are attacking the market with ads Excess inventory Shelf life is critical

Solution
Sampling, on pack promo Rebates, sweepstakes, loyalty cards Price off, free goods, premiums, rebates, etc

Consumer Promotion


  

To induce immediate off take from the shelf To induce trial To buy more of your products To buy immediately

Trade Promotion
 

Encourages your trade channel to load up Move inventory from the company to the warehouse of the trade


Distributor or Key Accounts

Deals with promotional tools for staff and sales people who are involved with the trade.

Sell in (PUSH STRATEGY)




Trade Promotion based on




Volume buy a certain volume to attain a high discount Prompt Payment pay on time and get a discount Free goods using new products or slow moving products as promotional items

Volume Promotion
 

It motivates the dealer to buy more Example




 

10+1 promotion buy 10 boxes get one free Volume discounts Bundle promotion feature a new product as freebie

Advertising Promotion


Cooperative advertising
 

Coke and Julies Bakeshop Lock in to the outlet to exclusively sell your brand

Cooperative Promotion
 

CoCo-branding Using another brand to penetrate the market Good if the equity of the other brand is high or parallel

Co-branding
   

Can be a strategy or a promotion It increases margin Synergizes strength of two brands Increases profitability due to the higher value perception

Free Goods


Better profitability Moves higher volume Economies of scale

Trade Advertising


Advertisements used as a basis for booking sales Rationale is consumers will look for a brand that has ad support

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Massive advertising always leads to higher trade acceptance Trade will only stock items that will sell

Personal Selling
Direct Selling Distribution Selling Outlet Selling

Direct Sales


 

One of the recent trends in consumer marketing Direct hit to consumers Smaller ad spending

Direct sales
 

  

Uses human capital as resource Offering high earnings to those who do not have businesses Home based People get people strategy Very sound business model

How do they profit?


   

Gross Margin 40% 1st level Commission 10% 2nd level commission 8% 3rd Level commission 5% AT this point, the company still earns and yet the number of networks grow.

Direct Sales
  

Meaningful to sales people The consumer saves money Answer to the crisis of power of retail channels

Distribution Selling


Sales efforts to cover geographic region Cover relevant distribution channels Example:


Bonheur Marketing

Bonheur Marketing
 

Former exclusive distributor of Marlboro and Philip Morris Covers outlets such as
    

Supermarkets Sari sari stores Sub distriutors Dealers Luzon wide

BiC became better when




Distribution was assigned to FilStar an affiliate of National Bookstore Thats why BiC enjoys great retail presence in NBS

Public Relations

Advertising

Key things to remember


     

Creative brief Copy strategy Execution methods Media Media Planning Success tracking

Creative Brief
     

Brand elements Target segment Reason to buy Current behavior Current perception Desired impression

Copy Strategy
      

Tagline Plot Mood and Tone Reason to believe Execution Media Media Plan

Media Plan


Medium
 

Above the line Below the line Front Back Seasonal Flat

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Media
   

TVC Print Radio Internet


       

CPM (clicks per million) Ad click Ad impressions Banner or button advertisement Click through Cost per click Spam URL

Media
    

Billboard of course they will stay Mall panels Comfort ads Transit ads Non traditional


Corporate gifts

Leaflets

Media Plan


Using each medium optimally to achieve brand objectives It is all about making the right mix or right allocation of budgets Hitting consumers where it matters most

Executions
     

Humor MTV Slice of life Celebrity endorser Testimonial Image model can be a competent looking person Performance test

Just make sure they do not




Laugh and forget which brand is being advertised Remember the story in the ad and then forget about the brand Remember the song and then ano nga palang brand yun?!

Things you should remember




Matrix or charts or altering SWOT with TOWS analysis (which by the way is not a marketing tool but a central management tool) DONT BUY THE IDEA The basics still work and it will sans a few alterations IMC is integrating all communication materials under one big idea

Remember
   

 

Life is a journey of learning The moment you get cocky is the time you die Mistakes are best teachers Do not believe all teachers too some of them have issues as well pick good mentors Dont label anything good or bad Know thy Dharma know what you are here for

Remember
 

Detachment is a great tool Make yourself competent goal is not to be employed but employable Dont make yourself stagnant even if your family or husband is rich Have FAITH

Remember


PR competence is as important as knowledge Be the best you can ever be (not Alipin Sagigigilid all your life)

Thank you for such a wonderful semester really