Promotional Mix Sales Promotion: Represents all marketing activities used to promote sales outside of personal selling, advertising, and PR. Increase sales Acquire customers Create a positive business or corporate image

Sales Promotions v. Advertising Advertising positions a product or service so that it looks better to a consumer compared to its competition Sales Promotions include a variety of strategies designed to offer purchasers an extra incentive to buy. Why use sales promotions? To increase sales in a short time. To introduce a new product on the market

Sales Promotions Sales promotions are Incentives that encourage customers to buy products or services Broken down into Trade Promotions & Consumer Promotions Trade promotions are sales promotion activities designed to get support for a product from a manufacturer, wholesaler, & retailer. Trade promotions focus on businesses selling to other businesses A lot of money is spent on promoting your product to other businesses versus the actually consumer

Trade Promotions Types of Trade Promotions that exist include: Promotional Allowances Cooperative Advertising Slotting Allowances Sales Force Promotions Trade Shows & Conventions Dealer Loaders

Trade Promotions: Promotional Allowance Promotional Allowance: Funds given by a manufacturer to a middleman or retailer for promoting its product. For example, a household products company gives a grocery chain a promotional allowance for placing their new detergent in a special display at the end of the aisle.

Trade Promotions Dealer Loaders-Gift offered to a retailer by a manufacturer as a bonus for purchasing the manufacturer's merchandise. Usually something the retailer gets to keep after promotion ends

Cooperative Advertising: A manufacturer supports the retailer by helping to pay for the cost of advertising a product locally. Example Walgreens receives money from companies like Pepsi in order for their circular to be placed in the local newspapers like the Charlotte Observer

Trade Promotions: Slotting Allowances Slotting Allowance: A one-time payment by a manufacturer or vendor to a retailer in order to ensure shelf space in the retailer's store(s) or in its warehouses. Endcap sales 500% greater Front Counter Sales 1000% greater

Sales Promotions Sales Force Allowance: Awards given to dealers and employees who successfully meet or exceed a sales quota. Awards range from cash prizes, to merchandise, or travel awards.

Allow companies to showcase a particular line of product. Sales Promotions Trade Shows & Conventions: Allow companies to showcase a particular line of product. Introduce new products Encourage increased sales of existing products Gain support Many companies invest millions of dollars in their display booths.

Sales Promotions: Consumer promotions Consumer Promotions: Sales strategies that encourage customers and prospects to buy a product or service. Support advertising, personal selling, & PR efforts. Include promotional tactics such as distributing coupons, premiums, product samples, loyalty programs, & product placement.

Sales Promotions: Consumer Coupons: Certificates that entitle customers to cash discounts on goods and services. Stores that accept coupons send them to the manufacturers’ headquarters or to a clearinghouse to be sorted and passed along to redemption centers. The centers in turn reimburse the stores for the face value of each coupon plus a handling charge of about $.08. The redemption center then bills the manufacturer for the amount they pay.

Consumer Promotions Rebates-like coupons, offer value to purchasers typically by lowering product price. Rebates often request the purchaser to submit personal data in order to obtain rebate.

Consumer Promotions Free Standing Inserts: Advertising brochure, card, or leaflet inserted in a newspaper or magazine, usually to serve as a reply coupon or discount voucher.

Consumer Promotion Promotional Pricing: A reduction on the selling price of a product

Consumer sales promotions Trade-In allow consumers to obtain lower prices by exchanging something the customer possess, such as an older product that the new purchase will replace.

Consumer Promotions Demonstrations-promotional technique whereby the use of a product is demonstrated in a retail outlet. The in-store demonstration is used most often in large department stores, supermarkets, or mass- merchandise outlets that exhibits a heavy consumer-traffic pattern. Often, manufacturers will offer product discounts to dealers who will do in-store demonstrations.

Consumer Promotions Premiums: Low cost items given to consumers at a discount or for free. Designed to increase sales by building product loyalty, & attracting new customers. Should create an immediate need for the customer to buy The 3 most common types of consumer premiums are factory packs, traffic builders, & coupon plans.

Consumer sales Promotions A traffic builder is a low cost premium that a company gives away to customers for attending an event Coupon Plans are ongoing programs that offer a variety of premiums in exchange for labels or coupons. Factory packs are free gifts placed in product packages.

Consumer Sales Promotions Sponsorships: Companies pay a fee for the right to promote itself & its products or services at or on a set location. The locations can be a physical site (stadium), an event (concert), a group (car racing team), or a person (golfer).

Sponsorship Examples

Consumer Sales Promotions Loyalty Marketing Programs Frequent Buyer Program Reward customers for patronizing company Airlines: Frequent Flyer Programs T.G.I. Fridays: Gold Points Card Hotel: Stay 2 Nights, Get 3rd Free

Examples of Loyalty Programs

Consumer Sales Promotion Product Placement A consumer promotion that involves using a brand-name product in a movie, television show, sporting event, or music video.

Consumer Sales Promotions Incentive High priced items earned through giveaways, sweepstakes, & contests Prizes are usually cash prizes, cars, or vacations Contests: Consumers usually have to do something to win Sweepstakes: Game of chance to win

Consumer sales Promotions Product Sample: Free sample of the product Can be sent through the mail or given in person

Consumer Promotions Personal Appearance: Someone of interest to the target market is paid to make an appearance supporting a product Author Sports figure Celebrity Generates foot traffic to store or mall

Consumer Sales Promotions Point-of-Purchase Displays Displays designed primarily by manufacturers to hold and display their products Promote impulse purchases

Assignment Create five types of sales or consumer promotions for any product or service you wish All promotions must be original No copy & paste You can draw out your designs or use a computer Examples: Create a coupon for a product that interests you Draw a FactoryPack Create a flyer of a concert or event that is being sponsored Do a video or take a picture where product placement is being used

Example of a Coupon

Example of a Concert Flyer with Sponsorship Twitter