Effective sales promotion

1. Effective sales promotion Hoorcollege marketing communication blok 4 week 5

2. Learning goals • By the end of the college and you should: • Be in a position to define sales promotion • Be aware of the factors that have led to a growth in sales promotion as a tool • Understand what above the line and below the line communications are • Understand how sales promotion can be integrated into a communications campaign • Be aware of the traditional and interactive media tools available to develop sales promotions • Be able to use the appropriate tools to develop a sales promotion for a campaign (such as the eBay campaign)

3. Agenda • What is sales promotion? • Stages in developing a sales promotion • Objectives of sales promotion • Different targets for sales promotion activities • Tools of sales promotion • Interactive media and sales promotion

4. What is sales promotion? • Sales promotions are short-term incentives (above the basic product benefits) aimed at encouraging purchase or sales Source: Kotler, P., (2005) Principles of Marketing 4th European Edition, Harlow: Pearson Education Ltd, p. 785 • There are issues with this definition • Over emphasizes “incentives” • Sales promotions also include product literature, merchandising, point of sale (POS) materials • It is not clear who these incentives are aimed at?

5. Definition of sales promotion • All below the line communication activities designed to encourage • Sales staff to push and/or • Intermediaries to purchase and/or • End customers to purchase a product or service by affecting their perceived value of the product in a positive manner

6. Below the line?

7. The growth of sales promotion Estimates from Pickton, D. & Broderick, A. (2005). Integrated Marketing Communications 2nd edition, Harlow: Pearson Education Ltd, p. 636

8. Reasons for growth *Advertising when combined with sales promotion has 2 to 7 times the sales effect as advertising alone Source: Roberts, A. (1996), ‘What do we know about advertisings short-term effects?’, Admap, February, pp. 42-45

9. Stages in developing a sales promotion

10. Targets of sales promotion

11. Sales promotion objectives

12. End customer sales promotion objectives

13. Intermediary sales promotion objectives

14. Sales force promotion objectives

15. Tools of sales promotion

16. Customer sales promotion tools • Samples • Coupons • Cash-refunds / rebates (aka cash-back) • Price packs • Bulk discount / 12 halen, 11 betalen (BOGOF) • Premium items • Give aways • User gets user rewards • Usage rewards • Point of Purchase / Sale (POP / POS) actions & materials • Competitions / lotteries etc. • Brochures

17. Intermediary sales promotion tools • Discounts • Allowances • Reductions for damaged / old goods • Advertising costs • Free goods for bulk purchases • Push incentives • Sales force incentives • Advertising support • Support for retail environment • Support • POS materials / brochures • Preference on new product launches • Invoicing and logistics • Service support • Accredited dealer status

18. Sales force sales promotion tools • Bonus • Prizes • Promotions • POS materials / brochures • Creativity is key here

19. Interactive media and sales promotion • Interactive media is an interesting new channel for sales promotion • Customer focused • Coupons • Virtual trial • Competitions • Product information • Cash back administration • Intermediary focused • Product information • Virtual trial • Joint promotion activites

20. Fulfilment is the key to a successful sales promotion • A sales promotion that is not thought through is very risky • Can cost more than it brings in • Can leave unhappy customers / dealers / sales people • When developing a sales promotion you must always think how it be fulfilled

21. Summary • There is more to sales promotion than just give-aways • Sales promotion is strong at converting desire into action • A successful sales promotion must be thought through • Fulfilment is key