Sales Promotion, Point-of-Purchase Advertising, and Support Media

1. 15 Sales Promotion, Point-of-Purchase Advertising, and Support Media

2. Coordination Challenge Directories Events Television Internet Billboards Magazines Branded Entertainment Transit Radio

3. Traditional Support Media • Purpose: To reinforce or extend a message being delivered through other media • Signs, billboards • Transit • Aerial • Specialty • Directory

4. Advantages Wide local exposure Captivating Around-the-clock exposure Address an immediate need or desire Disadvantages Message limits Location affects impact Relatively expensive Criticized by environmental groups Outdoor Signage and Billboards

5. Transit Ads • Transit Ads • Urban environments • Demographic segmentation • Timely to purchase • Build brand awareness

6. Aerial Ads • Aerial Ads • Blimps increasingly common • Common at sporting events • Networks are in control

7. What is Vehicle Wrapping? • Vehicle wrapping is a form of outdoor advertising • Digitally-generated graphics are printed on vinyl, and subsequently “wrapped” onto vehicles • Has become an international advertising medium

8. Outdoor Advertising - An Overview • U.S. advertisers spent $4.8 billion on outdoor media in 1999 • Outdoor ads represent 2% of all advertising media • Growing approximately 10% per year • Growth is faster than: • Total Advertising Expenditures • Gross Domestic Product (GDP)

9. The Power of the Personal Vehicle The Average Person: • Spends two hours per day in a car • Averages 48 miles per day on the weekends • Makes four or five trips each day • 125 million Americans commute to work daily • Daily trips have increased by 110% since 1970 • Total number of cars on the road is up over 174% • Motorists travel 3.4 trillion miles each year Source: Federal Highway Administration Outdoor Advertising Association of America (OAAA)

10. Wrapping for the Advertiser • Advertisers approach trucking companies, dealerships, etc. to “use” their vehicle(s) • Costs from $500 to $2500 to wrap an automobile • The use of vinyl technology has made the medium more cost effective • Aids in helping build awareness or maintain brand image

11. Continued . . . • Global Positioning System (GPS) • Satellite-based tracking system • Installed by plugging device into cigarette lighter • Provides 24-hr., three dimensional position, velocity and time information • Updates data everyfour minutes • Is key in determining OTS (opportunity to see)

12. Wrapping for the Consumer Companies such as Autowraps, Media Vehicles and Ads on Wheels are designed to accommodate people who would like to have their vehicle wrapped http://www.adsonwheels.com http://www.autowraps.com http://www.mediavehicles.com

13. Continued. . . Three Types of Vehicle Wrapping • Full Wrap • Covers entire exterior, including windows • Driver is paid $450 max per month • Decal Graphic • Requires only 50%exterior coverage, usually a large graphic or text image • Driver is paid $250 max per month • Window Wrap • Covers two rear windows and back windshield • Driver is paid $150 max per month

14. Takes 8 hrs for full wrap Takes 4 hrs for decal and/or window wrap Installation takes place within 30 mile radius of driver Driver is asked to provide proof of insurance, a DMV report, and sign agreements Required to drive approx. 1000 hours per month Meet with field monitor for a monthly inspection, and to switch out GPS system Maintenance

15. Businesses - Advantages • Can provide exposure in urban areas and on the interstate • Allows for outdoor advertising where no billboard space exists • Have the ability to entertain, educate and inform • Geographic and demographic flexibility • This form of advertising is less intrusive and annoying than other forms

16. Businesses - Disadvantages • Must maintain message control • Social Responsibility • I.e. “Make 7…Up Yours” • Cannot be used as the sole promotional tool • Component of an overall communications mix

17. Consumer - Advantages • Generate extra income • Low-end and high-end cars are used • Some companies are willing to donate their wrapped vehicles if motorists will drive them • Great for those with no mode of transportation • Some companies sell their wrapped vehicles at special discount rates

18. Consumer - Disadvantages • Too eye-catching for the open road • “Sophisticated Graffiti” • Could spark an onslaught of spray painting on buildings, cars and trucks • Difficult to break contracts

19. Airport Advertising: Dioramas The following airport advertising info is from Yong Jun Sung & Pumsoon Park - the first and most commonly utilized - located throughout the terminals in arrivals, departures, ticketing and baggage claim areas - Wall, shelter, and king-size dioramas

20. Wraps - The most widely used form of U.S. - Applied to flat surfaces (walls, windows, and floors) - Flexible in size and shape - For short or long term campaign

21. Cylinder Showcases - Highly visible units - Display products and services - Secure setting for products such as perfume, jewelry, fashions, and ceramics

22. SkyScreens (Plasma) - Provide digital advertising and information - At high-traffic passenger cluster areas - Catch the eyes of people

23. Baggage Cart Sponsorships - Deliver total audience coverage - Message frequency

24. Others Bus shelter Kiosks Leaflet dispensers

25. On average Passengers spend 93 minutes at the airport High recall rates for airport advertising Message Effectiveness Traveler arrive at airport 57 minutes Prior to departure On average

26. How We Measure? 1. Overall airport traffic Ex) World airport ranking by total passengers 1999 Atlanta – 78,092,940 (Rank #1) JFK, NY – 31,700,604 (Rank #20) Orlando – total passengers 29,203,755 (Rank #24) 2. The number of brochures or leaflets taken from displays

27. Orlando International Airport JFK International Airport (NY) 29,203,755 Annual Passenger 31,700.604 2,433,644 Monthly Passenger 2,641,717 Orlando Airport Size JFK Airport (NY) Popular Vehicles $ 3,300 Diorama 43” x 62” $ 4,000 $ 9,500 Spectacular 7’ x 11’ $ 12,000 $ 8,000 Exhibition Area $ 24,000 $ 1,500 Interactive Courtesy Phone Center 16” x 10” $ 2,000 $ 25,000 SkyScreen 6’ x 4’ $ 35,000 * per month & unit Rate examples

28. Disadvantages Too many directories Long lead times Limited creativity Advantages High acceptance High availability Final link to purchase Directory Advertising:CD-ROM and Web-based Directories

29. Power Struggles and Sales Promotion • Sales promotion plays a key strategic role in the channel of distribution • Big name brands must be supported with sales promotion and POP to get the support of retailers through self space allocation. • The top 10 retailers control 43% of all packaged goods sales so they can dictate which brands get how much shelf space. • Brand marketers spend $30 billion a year on sales promotion and POP to gain favored retailer treatment and to provide incentives to household consumers and business buyers.

30. Sales Promotion • Using incentives to create a perception of greater brand value • Consumer Market • Induce household consumers to purchase a firm’s brand • Trade-Market • Motivate distributors, wholesalers, and retailers to stock and feature a brand • Business Buyer • Cultivate buyers in large corporations who make purchase decisions

31. Coupons Sales Promotion Examples Trade shows Contests Gift Cards Allowances Sweepstakes Incentives Sampling Price-off deals Premiums Brand placements Loyalty programs

32. Sales Promotion vs. Advertising • Short term demand vs. long term demand • Encourage brand switching vs. brand loyalty • Induce trial use vs. encourage repeat purchase • Promote price vs. promote image • Immediate results vs. long term effects • Measurable results vs. difficult to measure

33. Importance of Sales Promotion • $100 plus billion industry • Growth rate: 4-8 percent • Reasons for growth: • Demand for accountability • Short-term orientation • Consumer response to promotions • Proliferation of brands • Increased power of retailers • Media clutter

34. Objectives for Consumer-Market Sales Promotion 1. Stimulate trial purchase 2. Stimulate repeat purchases 3. Stimulate larger purchases 4. Introduce a new brand 5. Combat or disrupt competitors 6. Contribute to IMC

35. Coupons Price-off deals Premiums Contests/sweeps Samples and trials Phone gift cards Brand placements Rebates Frequency programs Event sponsorship Consumer-Market Sales Promotion Techniques

37. Coupons • Entitles a buyer to a price reduction for a product or service • Advantages • Give a discount to price sensitive consumer while selling product at full price to others • Induce brand switching • Timing and distribution can be controlled • Stimulates repeat purchases • Gets regular users to trade up within a brand array

38. Coupons (cont’d) • Disadvantages • Time of redemption cannot be controlled • No way to prevent current customers from redeeming coupons • Coupon programs require costly administration • Fraud is a serious, chronic problem

39. Price-Off Deals • Offering consumers a reduced price at point of purchase through specially marked packages • Advantages • Is controllable by manufacturer. • Affects positive price comparisons. • Increases consumers’ belief in the value of a known brand. • Disadvantage • Retailers believe it creates inventory and pricing problems.

40. Premiums and Advertising Specialties • Premiums • Free or reduced price for an item with the purchase of another item. • Free premiums provide item at no cost. • Self-liquidating premiums require consumers to pay most of the cost of the item • Advertising specialties: • A message placed on a free, useful item

41. Contests and Sweepstakes • Contests: consumers compete for prizes based on skill or ability. • Sweepstakes: winners picked by chance • Both create excitement and interest • But… • Legal and regulatory requirements are complex. • Consumers may focus on the game rather than the brand. • Difficult to get an IBP message across in a game.

42. Nordstrom Launches 'Twilight' Line, Gives Away Tickets to 'New Moon' Premiere

43. Samples and Trial Offers • Sampling • Giving a consumer an opportunity to use a brand on a trial basis with little or no risk • Types of sampling • In-store – Newspaper • Door-to-door – On-package • Mail – Mobile • Trial offers • Used for more expensive items • Try product for a fixed time • Trader Joes Example

44. Gift Cards • Manufacturers offer either for free or for purchase debit cards. • With phone time • Or with preset spending limits • Examples • Offers from Sephora, and The Gap.

45. Rebates • Money back offer requiring the buyer to mail a request for money back from the manufacturer. • Often tied to multiple purchases. • Many consumers fail to bother sending the request. • Canon example

46. Frequency Programs • Also known as “continuity programs” • Offer customers discounts or free products for repeat patronage • Common in the airline, travel, and restaurant businesses

47. Objectives for Promotions in the Trade Market • Objectives: Use a “push” strategy • Push a product into the distribution channel towards the consumer • Obtain initial distribution • Increase order size • Encourage cooperation with consumer market sales promotions • Increase store traffic

48. Trade-Market Sales Promotion Techniques • Incentives: Push money • Allowances: Merchandise allowances, slotting fees, bill-back allowances, off-invoice allowances • Sales Training Programs • Cooperative (Co-Op) Advertising

49. Business Market Sales Promotion Techniques • Trade Shows • Business gifts • Premiums and advertising specialties • Trial offers • Frequency programs

50. Trial offers are very effective in the business market. Why?  Click Bar To Start Video  Rewind Video Next Slide