G.V.

BHARATHI
Sales Promotion

McGraw-Hill/Irwin Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved.
 Sales Promotion

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An extra A tool to
incentive to buy speed up sales

Targeted to
different parties
 Sales Promotion Techniques

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Samples Contests, incentives

Coupons Trade allowances

Premiums Point-of-purchase displays

Contests/sweepstakes Training programs

Refunds/rebates Trade shows

Bonus Packs Cooperative advertising

Loyalty programs
 Long-Term Budget Allocations

100%
90%
Consumer Promotions
80%
70%
60% Media Advertising
50%
40%
30%
20% Trade Promotions
10%
0%
µ94 µ95 µ96 µ97 '98 µ99 µ00 µ01 µ02 µ03 µ04 µ05

% of Total Promotional Dollars, 3-yr Moving Average

 Sales Promotion Increases

Ú 

Declining brand loyalty

Short-term focus

Advertising clutter problem

 s 

Pros:
Involves giving
Excellent way to
consumers
induce trial. Cons:
some quantity
Allows consumers Costs can be
of a product
to experience high
free of charge
product without
to induce trial.
risk.
 Methods for Distributing Samples

Door-to-door


  Direct mail
In-store
On package

Event
Newspaper/magazine insert
Internet sites
Distributing Samples With Newspapers
Armor All Uses On-Package Samples
 Coupons

The Price
oldest and reduction
most widely used to consumer when
sales promotion tool they redeem coupon

85% of
consumers
use coupons;
21% use them regularly
Coupons are Most Often Used With«

Disposable Laundry
Cereal
Diapers Soap
Methods of Distributing Coupons

Other
Magazines
In / On Pack
Direct Mail
On line sites
Newspapers
Freestanding
Inserts
The Most Popular Coupons are FSIs
Coupons are Available Electronically
 Pros and Cons of Coupons

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Trains consumers to wait
Appeals to price sensitive
for coupon offer before
consumer
buying

Effective way to induce Often used by loyal

trial of new products consumers who may
purchase anyway
 Premiums

An offer of an item, merchandise, or

service, free or at a low cost, that is
an extra incentive for customers

m 
@


Õ

   

:
Consumers most Can have high cost.
preferred type of sales Consumer may not
promotion. value premium
High impulse value. offered.
 More Consumer-Oriented Promotions

Contests ± a promotion where consumers compete for prizes or

money on the basis of skills or ability.

Sweepstakes ± a promotion where winners are determined

purely by chance.

Rebates ± offers to return some portion of the product purchase

price after supplying proof of purchase.

Loyalty programs ± programs that reward customers for

continuing to purchase the same brand of product or service
over time

Bonus Packs ± offer the consumer an extra amount of a product

at the regular price by providing larger containers or extra units
Contests Can Build Brand Equity
Media Often Delivers a Promotion Message
 Trade Oriented Promotions

Obtain distribution for new

products


Build retail inventories

Encourage display of
products
 Types of Trade Oriented Promotions

Contests and incentives

Co-op Advertising

Trade allowances

POP displays
Buying

Sales training Promotional

Trade shows
Slotting
Coordinating Sales, Advertising, IMC Tools

Budget
allocation

Coordination of
themes
Media support
and timing