SALES PROMOTION How have you been induced to buy merchandise?

Sales Promotion  Is short-term incentive to encourage buying  Its purpose is to increase demand and sales  It can be either trade- or consumer-oriented

Trade Promotions  Slotting Allowance  Buying Allowance  Trade Show/Conventions  Sales Incentives

Slotting Allowance  Paid by manufacturer to retailer  Essentially buying shelving space in a store

Buying Allowance  Price Discount  Usually for buying in large quantities or bulk

Trade Shows/Conventions  Introduces new products  Promotes good will with company

Sales Incentives  Awards given to employees for sales of a certain product  Can be in the form of contests  Insurance Sales  Direct TV  Can be cash, trip or other prizes

Consumer Sales Promotions  Premiums – coupons, factory packs, traffic builders and coupon plans  Incentives – Contests, Sweepstakes and rebates  Product Samples  Promotional Tie-Ins  Product Placement  Visual Merchandising and Displays  Loyalty Marketing

Premiums  Low cost items given to consumers at a discount or for free  Designed to build product loyalty or attract new customers  Plan for low cost items  Provide an added value  Negate the price issue  Differentiate products from the competition  Create an immediate need

Coupons  Use coupons to introduct new products  Enhance sales of existing products  Place on or inside packages  Sent through regular mail  Featured on web site  Printed in newspapers or magazines

Factory Packs  Free gives in other products  Often used in cereals  Prize in Cracker Jack

Traffic Builders  Giveaways at Grand Openings  Visiting a new store or special event  First 100 customers...

Coupon Plans  Ongoing  Promote brand loyalty  Send UPCs and get a free cookbook

Incentives  Usually higher priced  Contests  Sweepstakes  Rebates

Contests  Games or activities that require skill  Examples –Name a new product –Come up with an Advertising Slogan –Brittney’s project  Prizes awarded to winners

Sweepstakes  No purchase necessary  Game of chance  Hope to increase your traffic flow and sales

Rebates  Discounts by manufacturers  Within a given time period

Product Samples  Way to promote new products with no risk to the consumer  By mail, door-to-door or at stores  Drug samples to doctors

Promotional Tie-Ins  Arrangement between manufacturers  For example: –McDonald’s Happy Meal toys and –Disney movies

Product Placement  Exposure  Product recognition through special events, television or movies  James Bond – Rolex Watch and BMW  Coke vs. Pepsi  In movies ($$)

Visual Merchandising and Displays  Window, floor or counter displays  In-store advertising

Loyalty Marketing  Frequent Flyer Programs  Promotes loyalty  Offers consumers incentives not to buy from the corporation.

Activity: Promotional Calendar Prepare a promotional plan/calendar for a year for a product/service of your choice. Incorporate all four types of sales promotions!