Sales Promotion, Events, and Sponsorships

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

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 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 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 ADVERTISING Principles and Effective IMC Practice

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

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

7. 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) ADVERTISING Principles and Effective IMC Practice

8. Consumer Promotions ADVERTISING Principles and Effective IMC Practice

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

10. 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 ADVERTISING Principles and Effective IMC Practice

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” ADVERTISING Principles and Effective IMC Practice

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 ADVERTISING Principles and Effective IMC Practice

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) ADVERTISING Principles and Effective IMC Practice

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

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

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

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

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

19. 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 ADVERTISING Principles and Effective IMC Practice

20. Premium ADVERTISING Principles and Effective IMC Practice

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

22. Exercise: identify types of sales promotion • Top Shop offers “Buy 2 Get 1free” 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. 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 ADVERTISING Principles and Effective IMC Practice

24. Trade Sales Promotion ADVERTISING Principles and Effective IMC Practice

25. 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 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) ADVERTISING Principles and Effective IMC Practice

27. POP 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) 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 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) ADVERTISING Principles and Effective IMC Practice

31. SPONSORSHIPS Pepsi was a sponsor for Concert of Black Eyed Peas ADVERTISING Principles and Effective IMC Practice

32. Mc Donald’s Aerial Advertising ADVERTISING Principles and Effective IMC Practice

33. Starbucks Gold Membership ADVERTISING Principles and Effective IMC Practice

34. Promotions that Across the lines Partnership programs: Co-marketing:Manufacturer and retailerdevelop a marketing communication program together e.g. P&G with Tesco Lotus Co-Branding:Two companies come togather tooffer 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 promotione.g. McDonald & Walz Disney ( 2 products joined  bigger impact ,  share the advertising cost) ADVERTISING Principles and Effective IMC Practice

35. CO-MARKETING 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 ADVERTISING Principles and Effective IMC Practice

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

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

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

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