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Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1 Sales Promotion, Events, and Sponsorships Part 5: Integration.

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Presentation on theme: "Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1 Sales Promotion, Events, and Sponsorships Part 5: Integration."— Presentation transcript:

1 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1 Sales Promotion, Events, and Sponsorships Part 5: Integration and Evaluation Chapter 16

2 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-2 Key Points Explain the principles that drive the use of sales promotion List and explain the use of various consumer promotions Summarize the types and purposes of trade promotions Describe the use of other types of promotions Explain the strategic use of promotions in marketing

3 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-3 price product place promotion Product designs, Branding, Maintenance, Packaging Cost, Profit, Value expectation Wholesaler, Retailer, Transporter, Intermediary Public relations, Sales promotion, Personal selling, Direct marketing, Packaging Advertising Marketing Mix Strategies

4 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-4 The Practice of Sales Promotion A marketing discipline that utilizes a variety of incentive techniques to structure sales-related programs that generate a specific, measurable action or response

5 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-5 Why Sales promotion? -Need for short-term profit - Easy to evaluate the impact (from sales volume) - High cost of Media -Market share: battle for market share instead of product growth -Consumer behavior: expect the short term price reduction -Pricing: reduce the risk of purchase -Parity products :increasing sales when products are largely undifferentiating e.g. mass product -Power of the retailer: dominant retailers demand incentives to offer shelf space Company SideConsumer Side

6 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-6 Result Sales promotion: cost less, produce immediate results (short-term sales) Consumer:RiskValue added (more for less)

7 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-7 Consumer Sales promotion is a promotion aim at ultimate consumers of products Trade Sales promotion is a value added program directed at trade members (reseller) Types of Sales promotion

8 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice8 Consumer Promotions

9 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-9 Price Deals - Cents-off: Reduce prices e.g. 20% discount, 50 % discount

10 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-10 Price–pack deals: offer additional quantities of the product being purchased or provide the consumer with something extra Ex: buy two get one free Price Deals

11 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-11 Price Deals Bonus pack: offer additional amount of the product being purchased but contain in the packaging Ex: 25%more in this bottle of ketchup”

12 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-12 Price Deals Banned pack: more units of a product sold at a lower price than if they were bought a the regular singular unit price e.g Mama, toothpaste, soap

13 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-13 Coupon Coupon: are small written contracts that grant holders a price reduction within time frame 1) Retailer-sponsored coupons: redeemable only at the specified outlet 2) Manufacturer-sponsored coupons: redeemable at any outlet (distributor)

14 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-14 Refund and Rebate Refund and rebate: Offer to return the certain amount of money to the consumer

15 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-15 Consumer Promotion Sampling: Allow the consumer to try the sample of the product

16 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-16 Consumer Promotion Contest: Engage consumers who compete for prizes based on skill or ability based on skills or talent

17 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-17 Consumer Promotions Sweepstakes: Award prizes to consumers. Based on luck or chance of selection

18 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-18 Consumer Promotions Specialties items: Give- away items as a reminder for the brand

19 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-19 Premium: an extra product or tangible reward for consumer’s particular behaviors usually purchase 1. Direct premium award given at the time of purchase -- Store premiums: given to customers at the retail site e.g premium at 7elevent, department store -- In-pack premiums are inserted in the package at the factory e.g toys inside the snack package -- On-pack premiums are placed outside the package e.g detergent with brush -- Container premiums in which the package is the premium e.g. S&P cookie box 2. Mail premium are sent to consumers after they meet certain requirement. --Self-liquidation programs is a payment be mailed in along with some proof of purchase before the customer receives the premium -- the customers save the coupons or special labels attached to the product that can be redeemed for merchandise Consumer Promotion

20 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-20 Premium

21 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-21 Other Types of Premium

22 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-22 Exercise: identify types of sales promotion Top Shop offers “Buy 2 Get 1 free” promotion for T-shirts Herbal Essence shampoo gives more 50% in quantity at the same price Berman toothpastes are sold in a pack of 3 at discount price Latest Ovaltincampaign requires the Ovaltin consumers to return the Ovaltin package with their names for lucky draw. It offers many valuable prizes. 7 Eleven offers ‘Kitty pillow’ for the purchase of more than 100 baht +pay more 20 baht.

23 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-23 Consumer Sales Promotion Objective VS Types AwarenessTrial Maintain & Increase Market Share Brand Reminder - Special Event -Sponsorship -Point-of-purchase -Special Event -Sampling -Price deal e.g. Cent off -Coupon -coupon -premium -special event -contest -sweepstake -Price Deals Specialty items Specialt y Ad Use Advertising to support each objective

24 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice24 Trade Sales Promotion

25 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-25 Goal -Designed by manufacturer to get cooperation of people in distribution channel (trade member) -Encourage the promotion of product to the consumer -gauged from sales volume Target: Resellers (wholesaler, retailer) 2 Roles: -Trade support: to stimulate in-store merchandising, superior store location, shelf space -Excitement: to create the high level of attention from resellers about the product  sales Trade Sales promotion

26 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice26 Types of trade Sales promotion -Point-of-purchase (POP) display: Manufacturer-designed display distributed to retailers to get attention from the customers Example: Special rack, display carton, banner, sticker, signs, price card, etc. - Retailer (dealer) kits: Materials and information to help retailer sell ability such as price information, product specification, product display instruction, etc. - Contest and sweepstakes: can motivate resellers (increase relationship) - Trade shows and exhibition: provide opportunities to exchange information, demonstrate and sample products and sell merchandise (usu. same industry)

27 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-27 POP

28 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice28 -Trade incentive and deals: Reward for purchasing at the certain amount of product. -- Bonuses (push money, spiff): monetary bonus paid to store ’ s salesperson based on the units that salesperson sells over a period of time -- Dealer loaders are premiums (=consumer premium) a manufacturer gives to a retailer for buying a certain amount of product e.g. free trip, --allowances: is a price reducing and reward program for trade to purchase in a certain amount of product (discount) -- advertising allowance: the manufacturer pays the resellers a certain amount of money to advertise the manufacturer ’ s product (flat amount or percentage according to the gross purchase) -- Cooperative ads.: contractual arrangement between manufacturer and resellers, the manufacturer agrees to pay a part or all ad expenses incurred by the resellers. -- display allowances: direct payment of cash or goods is given to the resellers if the resellers agree to set up the point-of-purchase (POP) Types of trade promotion (contd.)

29 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-29 Consumer Sales Promotion Objective VS Types Attention Motivation Information & Trial -Point-of-purchase (trade and consumer) -Trade deals -contest -prize - Trade Show& Exhibition -Retailer (Dealer ) Kits

30 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-30 Sponsorship: Company supports an event either financially or by donating supplies and services e.g. Olympics, golf tournament Event marketing: Building product marketing’s program around a sponsored event. -Practice of linking a brand to an event that usually matches the brand to the target market’s lifestyle e.g. Nokia (Lamour) + Fashion Week Aerial advertising support: Balloon, Giant model, etc. Promotions that Across the lines Awareness +sales Loyalty Program (loyalty program or continuity program): is a promotion to increase customer retention In order to keep and reward the continued patronage e.g. member card, airline frequent flier program ( Higher purchaseGreater benefits )

31 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-31 SPONS ORSHIPS Pepsi was a sponsor for Concert of Black Eyed Peas

32 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-32 Mc Donald’s Aerial Advertising

33 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-33 Starbucks Gold Membership

34 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-34 Promotions that Across the lines Partnership programs: Co-marketing: Manufacturer and retailer develop a marketing communication program together e.g. P&G with Tesco Lotus Co-Branding: Two companies come togather to offer the product e.g. Credit card co. with restaurants, hotels, spa (both get brand equity) Licensing agreements (rents): A company’s legal permission for other manufacturers to use their company’s logos, symbols, trade characters, identities for or use on other product e.g. Waltz Disney products (the co. gets the money + extend the brand) Tie-ins: associate complementary brands linking two complementary products in a promotion e.g. McDonald & Walz Disney ( 2 products joined  bigger impact,  share the advertising cost)

35 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-35 MAR KETING CO-MAR KETING Drink Pepsi has a chance to win Yamaha Meo ZR when buy pepsi product up to 500 bath receive 1 coupon compete for the prize. Only at Makro

36 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-36 C O- BRANDING COUPONCOUPON DISCOUNT 10% For Zoo Park DISCOUNT 20% For Park DISCOUNT 10% For Fun Park DISCOUNT 50% For Alangran Theater DISCOUNT 20% For Mini Siam DISCOUNT 20 bath For Crocodile Farm DISCOUNT 10% For Fun Park

37 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-37 A limited collection MAC Hello Kitty by US. MAC Cosmetics and Japanese company Sanrio have teamed up to create MAC Hello Kitty

38 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-38 PLACE (DISTRIBUTION): -Have mechanism for delivering and servicing the product and receive payment -- Market Coverage Strategy: geographic distribution eg. BKK, nationwide --Push Strategy: direct marketing efforts at reseller (many channels) Pull Strategy: direct marketing efforts at consumer (create demand) Marketing Mix Strategies (contd.)

39 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-39 Push, Pull, and Combination Strategies

40 Wells, Moriarty, Burnett & Lwin - Xth EditionADVERTISING Principles and Effective IMC Practice1-40 Activity Each pair gives one example of consumer sales promotion


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