6.04 Exemplify sales promotions

1. 6.04 Exemplify sales promotions

2. Sales promotion is… • All the communications or activities used to stimulate sales other than advertising, public relations or personal selling communications or activities • For example: “Try your key” contest to bring people in to look at a new car model

3. A trade promotion is… • Designed to create support from manufacturers, wholesalers, and retailers for a product • Promotional allowances • Slotting allowances • Sales force promotions • Trade shows and conventions

4. Trade promotions … • Promotional allowances: Discounts or cash payments given to wholesalers or retailers who stock large quantities and encourage sales of a product. • A cereal manufacturer may offer a retailer ten cents per case promotional allowance to put towards local promotions if they purchase a certain volume of the product. • Slotting allowances: Cash premiums paid to retailers to help with the cost of restocking a new product. These premiums are also used to secure the best location for the products on shelves. • An end-cap on a grocery aisle provides higher visibility to Doritos.

5. Trade promotions are… • Sales force promotions: Awards given to dealers and salespeople who meet or exceed their sales quota. • A company may give a salesperson a cash bonus if they meet sales goals. • Trade shows and conventions: Designed to showcase a manufacturer’s products. • Ued to introduce new products, encourage sales of existing products, and meet contacts.

6. A consumer promotion is… • Designed to increase sales of a product • Coupons • Premiums • Deals • Incentives • Product samples • Sponsorship • Promotional tie-ins • Product placement • Loyalty marketing programs • Point-of-purchase displays

7. Consumer Promotions • Coupons: Certificates that provide cash discounts, or money off, on a good or service. • Domino’s offers a coupon for “Buy one 1-topping pizza and get a second one for half off”. • Premiums: Inexpensive items given away at a discount or for free. Premiums are used to establish product loyalty and attract new customers. • Free gifts with purchase or an ongoing coupon plan.

8. Consumer Promotions • Deals: Packages that offer similar products together for a temporary price break. • A shampoo and conditioner set sold together for a slightly lower price than if purchased separately. • Incentives: Contests, games, sweepstakes, or rebates used to create increased sales and excitement about a product. • McDonald’s uses their monopoly game to encourage customers to purchase more product.

9. Consumer Promotions • Product samples: Free trial sizes of a product given out to potential customers. Product samples are very helpful in promoting new products as they encourage people to try a new product without the risk of buying it. • A package of Crest toothpaste includes a free sample Scope mouthwash.

10. Consumer promotion • Sponsorship: A company pays for the right to promote itself and its products at a location or event. • DuPont sponsors a NASCAR racing team. • Promotional tie-ins (also called cross-promotion and cross-selling campaigns): Activities between two companies who combine efforts and resources to create additional sales for each other. • An ice cream retailer offers discounts to customers who come in after a movie and present a ticket stub.

11. Consumer promotion • Product placement: Involves using a brand-name product in a TV show, movie, or commercial, etc. • Warner Brothers featured America Online in its movie “You’ve Got Mail.” • Loyalty marketing programs (also called frequent buyer programs): Designed to reward customers for continued patronage. • Many airlines offer frequent flyer miles to customers. • Point-of-purchase displays: Placed in high-traffic areas of stores and are designed to encourage impulse purchases. • Drink coolers at check-out lines in grocery stores