1. Sales Promotion, Events, and Sponsorships
Part 5: Integration and Evaluation
Chapter 16
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ADVERTISING Principles and Effective IMC Practice

2. ADVERTISING Principles and Effective IMC Practice
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
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ADVERTISING Principles and Effective IMC Practice

3. Marketing Mix Strategies
Product designs,
Branding,
Maintenance,
Packaging
product
price
Cost,
Profit,
Value expectation
place
Wholesaler,
Retailer,
Transporter,
Intermediary
promotion
Advertising
Public relations,
Sales promotion,
Personal selling,
Direct marketing,
Packaging
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ADVERTISING Principles and Effective IMC Practice

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
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ADVERTISING Principles and Effective IMC Practice

5. ADVERTISING Principles and Effective IMC Practice
Why Sales promotion?
Company Side
Consumer Side
-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
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
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ADVERTISING Principles and Effective IMC Practice

6. ADVERTISING Principles and Effective IMC Practice
Result
Sales promotion: cost less, produce immediate results (short-term sales)
Consumer:
Risk
Value added (more for less)
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ADVERTISING Principles and Effective IMC Practice

7. ADVERTISING Principles and Effective IMC Practice
Types of Sales promotion
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)
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ADVERTISING Principles and Effective IMC Practice

8. Consumer Promotions Wells, Moriarty, Burnett & Lwin - Xth Edition
ADVERTISING Principles and Effective IMC Practice

9. ADVERTISING Principles and Effective IMC Practice
Price Deals
- Cents-off: Reduce prices e.g. 20% discount, 50 % discount
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ADVERTISING Principles and Effective IMC Practice

10. ADVERTISING Principles and Effective IMC Practice
Price Deals
Price–pack deals: offer additional quantities of the product being purchased or provide the consumer with something extra
Ex: buy two get one free
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ADVERTISING Principles and Effective IMC Practice

11. ADVERTISING Principles and Effective IMC Practice
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”
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ADVERTISING Principles and Effective IMC Practice

12. ADVERTISING Principles and Effective IMC Practice
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
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ADVERTISING Principles and Effective IMC Practice

13. ADVERTISING Principles and Effective IMC Practice
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)
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ADVERTISING Principles and Effective IMC Practice

14. ADVERTISING Principles and Effective IMC Practice
Refund and Rebate
Refund and rebate: Offer to return the certain amount of money to the consumer
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ADVERTISING Principles and Effective IMC Practice

15. ADVERTISING Principles and Effective IMC Practice
Consumer Promotion
Sampling: Allow the consumer to try the sample of the product
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ADVERTISING Principles and Effective IMC Practice

16. ADVERTISING Principles and Effective IMC Practice
Consumer Promotion
Contest: Engage consumers who compete for prizes based on skill or ability based on skills or talent
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ADVERTISING Principles and Effective IMC Practice

17. ADVERTISING Principles and Effective IMC Practice
Consumer Promotions
Sweepstakes: Award prizes to consumers. Based on luck or chance of selection
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ADVERTISING Principles and Effective IMC Practice

18. ADVERTISING Principles and Effective IMC Practice
Consumer Promotions
Specialties items: Give- away items as a reminder for the brand
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ADVERTISING Principles and Effective IMC Practice

19. ADVERTISING Principles and Effective IMC Practice
Consumer Promotion
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
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ADVERTISING Principles and Effective IMC Practice

20. ADVERTISING Principles and Effective IMC Practice
Premium
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ADVERTISING Principles and Effective IMC Practice

21. ADVERTISING Principles and Effective IMC Practice
Other Types of Premium
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ADVERTISING Principles and Effective IMC Practice

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.
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ADVERTISING Principles and Effective IMC Practice

23. Consumer Sales Promotion Objective VS Types
Specialty Ad
Awareness
Trial
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
Use Advertising to support each objective
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ADVERTISING Principles and Effective IMC Practice

24. Trade Sales Promotion Wells, Moriarty, Burnett & Lwin - Xth Edition
ADVERTISING Principles and Effective IMC Practice

25. ADVERTISING Principles and Effective IMC Practice
Trade Sales promotion
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
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ADVERTISING Principles and Effective IMC Practice

26. 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)
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ADVERTISING Principles and Effective IMC Practice

27. ADVERTISING Principles and Effective IMC Practice
POP
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ADVERTISING Principles and Effective IMC Practice

28. Types of trade promotion (contd.)
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)
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ADVERTISING Principles and Effective IMC Practice

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
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ADVERTISING Principles and Effective IMC Practice

30. Promotions that Across the lines
Awareness+sales
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.
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 purchase
Greater benefits )
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ADVERTISING Principles and Effective IMC Practice

31. ADVERTISING Principles and Effective IMC Practice
SPONSORSHIPS
Pepsi was a sponsor for
Concert of Black Eyed Peas
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32. Mc Donald’s Aerial Advertising
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ADVERTISING Principles and Effective IMC Practice

33. Starbucks Gold Membership
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ADVERTISING Principles and Effective IMC Practice

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)
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ADVERTISING Principles and Effective IMC Practice

35. ADVERTISING Principles and Effective IMC Practice
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
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ADVERTISING Principles and Effective IMC Practice 35

36. ADVERTISING Principles and Effective IMC PracticeO U P N
CO-BRANDING
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
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ADVERTISING Principles and Effective IMC Practice 36

37. ADVERTISING Principles and Effective IMC Practice
A limited collection MAC Hello Kitty
by US. MAC Cosmetics and Japanese company Sanrio have teamed up to create MAC Hello Kitty
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ADVERTISING Principles and Effective IMC Practice

38. Marketing Mix Strategies (contd.)
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)
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ADVERTISING Principles and Effective IMC Practice

39. Push, Pull, and Combination Strategies
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ADVERTISING Principles and Effective IMC Practice

40. ADVERTISING Principles and Effective IMC Practice
Activity
Each pair gives one example of consumer sales promotion
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ADVERTISING Principles and Effective IMC Practice