1 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part Sales Promotion, Point-of-Purchase Advertising, and Support Media Sales Promotion, Point-of-Purchase Advertising, and Support Media 15 1 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

2 Sales Promotion Examples 15 4 Trade Shows Contests Loyalty Programs Brand Placements Gift Cards Coupons Allowances Incentives Sampling Price-off deals Premiums Sweepstakes Point-of-Purchase Displays Displays

3 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Sales Promotion vs. Advertising Short-term demand vs. long-term demand Encourages brand switching vs. brand loyalty Induces trial use vs. encourage repeat purchase Promotes price vs. image Immediate results vs. long-term effects Measurable results vs. difficult to measure 15 5

4 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Objectives for Consumer-Market Sales Promotion 1. Stimulate trial purchase 2. Stimulate repeat purchases 3. Stimulate larger purchases 4. Introduce a new brand 5. Combat or disrupt competitors 6. Contribute to IBP effort 15 7

©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 5 Consumer-Market Sales Promotion Techniques 1.Coupons 2.Price-off deals 3.Premiums 4.Contests/sweeps 5.Samples and trials 6. Phone gift cards 7. Rebates 8. Frequency programs 15 8

6 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Coupons Entitles a buyer to a price reduction for a product or service Advantages o Give discount to price sensitive consumers while selling brand at full price to others o Induce brand switching o Timing and distribution can be controlled o Stimulates repeat purchases o Gets regular users to trade up within a brand array 15 9

7 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Coupons Disadvantages Timing of redemption cannot be controlled No way to prevent current, brand loyal customers from redeeming coupons Coupon programs require costly administration Fraud is a serious, chronic problem 15 11

8 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Price-Off Deals Offers consumer reduced price at point of purchase through specially marked packages Advantages o Controllable by manufacturer o Can effect positive price comparisons o Consumers believe it increases value of a known brand Disadvantage o Retailers believe it creates inventory and pricing problems

9 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Premiums and Advertising Specialties Premiums: a free or reduced price item with purchase of another item Free premiums provide item at no cost to consumer Self-liquidating premiums require consumers to pay most of the cost of the item Advertising specialties: –A message placed on a free, useful item: pens, ball caps, coffee mugs 15 13

10 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Contests and Sweepstakes Contests: consumers compete for prizes based on skill or ability Sweepstakes: winners picked by chance Both create excitement and brand interest But... o Legal and regulatory requirements are complex o Consumers may focus on the game rather than the brand o Difficult to get an IBP brand feature message across in a game 15

11 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Samples and Trial Offers Sampling: Giving consumer an opportunity to use a brand on a trial basis with little or no risk Types of sampling - In-store (Costco) -Newspaper -Door-to-door -On-package -Mail - Mobile Trial offers - Used for more expensive items -Consumer tries a brand for a fixed time (week, month) 15 16

12 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Phone and Gift Cards Manufacturers offer either for free or for purchase debit cards o Cell phone time o iTune downloads o Preset spending limits Examples include offers from Starbucks, Barnes & Noble, and The Gap 15 17

13 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Rebates Money back offer often requiring the buyer to mail a request for money back from the manufacturer Can be used for large ticket items as well Often tied to multiple purchases Many consumers fail to bother sending in the rebate request form 15 18

14 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Frequency Programs Also known as “continuity” programs Offers customers discounts or free products for repeat patronage Common in airline, hotel, and restaurant businesses 15 19

15 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Risks of Sales Promotion Create a price orientation which contradicts brand image development Borrow from future sales Alienate loyal customers Significant time and expense Legal considerations 15 24

16 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Point of Purchase (P-O-P) Advertising Definition Materials used in the retail setting to attract shoppers’ attention to a brand, to convey primary product benefits, or highlight pricing information. Displays may feature “price-off” deals as well. Firms starting to use mobile device distribution Objectives for Point-of-Purchase Advertising Draw consumers’ attention to a brand in the retail setting. Maintain purchase loyalty among brand loyal users. Stimulate increased or varied usage of the brand. Stimulate trial use by users of competitive brands

©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 17 Outdoor Signage and Billboards Advantages Wide local exposure Can be captivating Around-the-clock exposure Can address an immediate need or desire New digital technology being used Disadvantages Message limits Location affects impact Relatively expensive Criticized by environmental groups 15 29

©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 18 Transit Ads Urban environments Reasonable demographic segmentation Good message repetition Timely to purchase locations Can subtlety build brand awareness 14 30

19 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Aerial Ads Blimps increasingly common Common at sporting events Digital technology offers more creativity Skies are getting crowded! Networks are in control 15 32

20 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Ari Cinema On-screen and off-screen in theaters Consumers say they are annoyed Research says reasonable acceptance of cinema ads 15 33

©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 21 Directory Advertising Advantages High acceptance High availability Final link to purchase Disadvantages Too many directories Long lead times for printed versions Limited creativity 15 34

22 ©2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Packaging Promotional Benefits of Packaging to the Advertiser: The package carries the brand name and logo The package can communicate “value” The package can communicate “image” and “quality” 15 35