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Sales Promotion

Sales Promotion. Promotion Mix / Communication Mix (PR). Sales Promotion PR Selling Advertising Below the line Above the line. Two Types of Sales Promotion. Consumer Promotion Trade Promotion. What do we want the consumers and trade to do?. Buy More Buy Now.

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Sales Promotion

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  1. Sales Promotion WWW.PPTMART.COM

  2. Promotion Mix / Communication Mix (PR) • Sales Promotion • PR • Selling • Advertising • Below the line • Above the line WWW.PPTMART.COM

  3. Two Types of Sales Promotion • Consumer Promotion • Trade Promotion WWW.PPTMART.COM

  4. What do we want the consumers and trade to do? • Buy More • Buy Now WWW.PPTMART.COM

  5. A sales promotion should be • Temporary – if not the consumers would not believe it the next time • Great Value Added – they should find reason to buy now and more WWW.PPTMART.COM

  6. Trends on Sales Promotion • ¾ of the marketing budget is allocated to sales promotion • In 1995, 51% of total adspend represents trade promotions. 24% on media spending 22% on consumer promotion • Growth in the coupon segment is tremendous in aspirational markets • Americans redeem more than 7 billion coupons annually. WWW.PPTMART.COM

  7. Why the Growth??? • Instant results • Faster implementation • Measurable • Relatively easy and inexpensive WWW.PPTMART.COM

  8. The Downside of Sales Promotion • Brand Erosion • Profitability increase is relatively low • Implementation cost and problems • Orients marketing managers towards short term results WWW.PPTMART.COM

  9. What a sales promotion should be…. • Lets go back to the basics • Should hit the consumer at a particular behavioral stage • Are marketing communication activities that change the price/value relationship of a product / service perceived by the target • Generating immediate sales • Altering long term brand value WWW.PPTMART.COM

  10. Planning Sales Promotion • Who is our target set of consumers? • What is the reason for that behavior • What is the goal of the program • Is there a meaningful economics attached to sales promotion WWW.PPTMART.COM

  11. Types of Buyers • Loyals • Buy a particular brand on a more or less consistent basis • Competitive loyals • People who are loyal to the competing brand • Switchers • Purchase of various brands in one category • Price buyers • Non Users WWW.PPTMART.COM

  12. Results that are needed …. • Loyals • Reinforce behavior • Increase consumption • Change buying timing • Competitive loyals • Break loyalty • Encourage brand switching • Switchers • Persuade to buy the “right” brand more often • Price • Value added to make price less important • Non users • Create awareness, create category worth WWW.PPTMART.COM

  13. Types of Sales Promotions • Coupon • Bonus Packs • In pack, On pack, and Near Pack • Specialty container • Continuity program • Refund • Sweepstakes • Contest • Through the mail Premium • Sampling • Price off • Trade deal • Cause related promotion WWW.PPTMART.COM

  14. Coupons • Clip and bring to the store to exchange • Now it is phone based • Induce loyalty • Repeat purchase • Keeps the consumers “locked” WWW.PPTMART.COM

  15. Bonus Packs • Like bundle pricing but this is temporary • Adds value WWW.PPTMART.COM

  16. In Pack, On Pack Promotion • It is used to introduce new products / service • Dispose of excess inventory • Use excess overhead WWW.PPTMART.COM

  17. Specialty Container • Increases product’s perceived value • Uy tignan mo ito meron libreng pitchel WWW.PPTMART.COM

  18. Continuity Program /Loyalty Cards WWW.PPTMART.COM

  19. Refund / Rebate Promotion • If the product does not perform, then its money back • Or consume X number of products and get Y FREE • Increases consumer confidence • Loyalty program WWW.PPTMART.COM

  20. Sweepstakes • Chance game where the consumer has the chance to win something big through purchases • The more purchases, the more tickets • Creates loyalty WWW.PPTMART.COM

  21. Sampling • Used when the consumer is unaware of the brand or product • Product buying is prone to retail channel based trial • Use when the product can be broken down into smaller dimensions WWW.PPTMART.COM

  22. Price off promotion • Use for slow moving items • Excess inventory • Off season • Dislodge competitors WWW.PPTMART.COM

  23. Choose the right promotion for the right situation WWW.PPTMART.COM

  24. Example WWW.PPTMART.COM

  25. Consumer Promotion • To induce immediate off take from the shelf • To induce trial • To buy more of your products • To buy immediately WWW.PPTMART.COM

  26. WWW.PPTMART.COM

  27. Trade Promotion • Encourages your trade channel to load up • Move inventory from the company to the warehouse of the trade • Distributor or Key Accounts • Deals with promotional tools for staff and sales people who are involved with the trade. WWW.PPTMART.COM

  28. Sell in (PUSH STRATEGY) • Trade Promotion based on • Volume – buy a certain volume to attain a high discount • Prompt Payment – pay on time and get a discount • Free goods – using new products or slow moving products as promotional items WWW.PPTMART.COM

  29. Volume Promotion • It motivates the dealer to buy more • Example • 10+1 promotion – buy 10 boxes get one free • Volume discounts • Bundle promotion – feature a new product as freebie WWW.PPTMART.COM

  30. Advertising Promotion • Cooperative advertising • Coke and Julie’s Bakeshop • Lock in to the outlet to exclusively sell your brand WWW.PPTMART.COM

  31. Cooperative Promotion • Co-branding • Using another brand to penetrate the market • Good if the equity of the other brand is high or parallel WWW.PPTMART.COM

  32. Co-branding • Can be a strategy or a promotion • It increases margin • Synergizes strength of two brands • Increases profitability due to the higher value perception WWW.PPTMART.COM

  33. Free Goods • Better profitability • Moves higher volume • Economies of scale WWW.PPTMART.COM

  34. Trade Advertising • Advertisements used as a basis for booking sales • Rationale is consumers will look for a brand that has ad support WWW.PPTMART.COM

  35. Direct Selling Distribution Selling Outlet Selling Personal Selling WWW.PPTMART.COM

  36. Direct Sales • One of the recent trends in consumer marketing • Direct hit to consumers • Smaller ad spending WWW.PPTMART.COM

  37. Direct sales • Uses human capital as resource • Offering high earnings to those who do not have businesses • Home based • People get people strategy • Very sound business model WWW.PPTMART.COM

  38. How do they profit? • Gross Margin 40% • 1st level Commission – 10% • 2nd level commission – 8% • 3rd Level commission – 5% • AT this point, the company still earns and yet the number of networks grow…. WWW.PPTMART.COM

  39. Direct Sales • Meaningful to sales people • The consumer saves money • Answer to the crisis of power of retail channels WWW.PPTMART.COM

  40. Distribution Selling • Sales efforts to cover geographic region • Cover relevant distribution channels • Example: • Bonheur Marketing WWW.PPTMART.COM

  41. Bonheur Marketing • Former exclusive distributor of Marlboro and Philip Morris • Covers outlets such as • Supermarkets • Sari sari stores • Sub distriutors • Dealers • Luzon wide WWW.PPTMART.COM

  42. BiC became better when… • Distribution was assigned to FilStar – an affiliate of National Bookstore • That’s why BiC enjoys great retail presence in NBS WWW.PPTMART.COM

  43. Advertising WWW.PPTMART.COM

  44. Key things to remember • Creative brief • Copy strategy • Execution methods • Media • Media Planning • Success tracking WWW.PPTMART.COM

  45. Creative Brief • Brand elements • Target segment • Reason to buy • Current behavior • Current perception • Desired impression WWW.PPTMART.COM

  46. Copy Strategy • Tagline • Plot • Mood and Tone • Reason to believe • Execution • Media • Media Plan WWW.PPTMART.COM

  47. Media Plan • Medium • Above the line • Below the line • Loading • Front • Back • Seasonal • Flat WWW.PPTMART.COM

  48. Media • TVC • Print • Radio • Internet • CPM (clicks per million) • Ad click • Ad impressions • Banner or button advertisement • Click through • Cost per click • Spam • URL WWW.PPTMART.COM

  49. Media • Billboard – of course they will stay • Mall panels • Comfort ads • Transit ads • Non traditional • Corporate gifts • Leaflets WWW.PPTMART.COM

  50. Media Plan • Using each medium optimally to achieve brand objectives • It is all about making the right mix or right allocation of budgets • Hitting consumers where it matters most WWW.PPTMART.COM

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