1. Consumer Promotions Chapter 10

2. Consumer Promotions Defined An incentive or an enticement that encourages a consumer to either select or purchase a product.

3. Types of Consumer Promotions Coupons Premiums Contests and sweepstakes Refunds and rebates Sampling Bonus packs Price-offs

4. Consumers and Sales Promotions Targeted consumers are classified three ways: Promotion prone consumers Brand loyal consumers Price sensitive consumers Take a look at question 8, on page 330. discuss with classmates seated close to you.

5. In-store distribution Direct sampling Response sampling Cross-ruff sampling Media sampling Professional sampling Selective sampling F I G U R E 1 0. 5 Types of Sampling

6. What’s Happening? http://www.eggs.ca/ContestsPromos/Default.aspx http://www.youtube.com/watch?v=5OfMb90v4qg http://money.cnn.com/2009/02/03/news/companies/dennys_breakfast.for tune/index.htm?postversion=2009020411 http://ca.youtube.com/watch?v=RYgKQ3_hWA4 http://ca.youtube.com/watch?v=uYIBAswqMEM http://ca.youtube.com/watch?v=CALvpp4nuJg

7. 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? n Fitness center n Ice cream n Dental service n Clothing manufacturer n Auto repair service n Office supply store

8. Sampling Most effective when used to introduce a new product or a new version of a product. Primary purpose is to encourage trial use by a customer. Sampling is a very effective IMC tool when used correctly. The two key drawbacks to sampling programs are: Cost Customers discarding the sample without trying it.

9. Types of Coupons Instant redemption Scanner-delivered Cross-ruffing/Co- branding Response offer E-coupons Bounce-back/return coupon

10. A coupon accompanies this informational Gold Bond advertisement

11. Types of Premiums Free-in-the-mail In- or on-package Store or manufacturer Self-liquidating

12. Fast-food chains are well known for their in-store premiums.

13. Match the premium to the target market. Carefully select the premiums (Avoid fads, try for exclusivity). Pick a premium that reinforces the firm’s product and image. Integrate the premium with other IMC tools (Especially advertising and POP displays). Don’t use premiums to increase profits. Source: Based on Don Jagoda, “The Seven Habits of Highly Successful Premiums,” Incentive, (August 1999), Vol. 173, Issue 8, pp. 104-105. F I G U R E 1 0. 4 Keys to Successful Premiums

14. Creating Successful Contests and Sweepstakes Know the legal restrictions. Must overcome clutter. Find the right combination of prizes. Must consider extrinsic and intrinsic value. Look for tie-in opportunities with special events or other companies. Must be coordinated with POP Displays and other marketing tools.

15. Successful Rebate/Refund Programs Visibility. Encourages customers to act. Not be too complicated. Avoid becoming a permanent component of the purchase decision (automobile rebates) Profitable for retailers to handle.

16. Increase usage of the product Match or pre-empt competitive actions. Stockpiling of product. Develop customer loyalty. Attract new users. Encourage brand switching. F I G U R E 10. 6 Reasons for Using Bonus Packs

17. 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.