How should sales promotion decisions be made?
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Transcript of How should sales promotion decisions be made?
How Should Sales Promotion Decisions Be Made?
Kotler Chapter 17Aayushi Aggarwal IIT Kanpur
Sales Promotion Consists of a collection of incentive tools ,mostly short term, designed to stimulate quicker or greater purchase
How Should Sales Promotion Decisions Be Made?
6. Implementing and evaluating the program
5. Developing the program
4. Selecting business and sales force
promotion tools
3. Selecting trade promotion tools
2. Selecting Consumer promotion tools
1. Establishing objectives
1. Establishing objectivesFor Consumers Segments
For Retailers
•Building trail among non users•Attracting switchers away from competitor
•Encourage off-season buying•Building brand loyalty•Gaining entry to new retail outlets
2. Selecting Consumer Promotion Tools
SamplesOffer a free amount of a product or service building trail among non users
Free sample of MyTide bleach with Tide
CouponsCertificates entitling the bearer to a stated saving on the purchase of a specific product
In newspapers
RebatesProvide a price reduction after purchase than at the retail shop.
Consumer sends a proof of purchase to the manufacturer who refund part of the purchase by mail
Price Packs
Reduced price pack is a single pack sold at a reduced price
Banded pack : 2 related products banned together Eg. Toothpaste and Toothbrush
Premiums(Gifts)
Are items that are given free with the purchase of the product
Frequency ProgramsPrograms providing rewards related to consumer’s frequency and intensity in purchase
PrizesOffers of the chance to win cash,trips, or merchendise as a result of purchasing the product or service.
Patronage Awards
Values in cash or in other forms that are proportional to patronage of a certain vendor
Free TrailsInviting prospective customers to try the product without cost in hope that they will buy.
Product WarrantiesExplicit or implicit promises by sellers that the product will perform or the seller will fix it or refund the customers money within the specified time.
Tie-In promotionsTwo or more brand or companies team up on coupons,refunds and contests to increase pulling power
Wolverine movie and Red Robin tied in promotions together
Cross-PromotionsUsing one brand to advertise another noncompeting brand
Point-of-purchase Displays and demonstrations
P-O-P displays and demonstrations take place at the point of purchase or sale. Eg. Beds and cars (Test drive for cars)
3. Selecting Trade Promotion Tools
Trade
Price off Allowances Free Goods
Price off
A straight discount off the list price during a stated time period
Allowance
An advertising allowance is a dividend paid by a marketer to a reseller for advertising its product.
Free goodsOffers of extra cases of merchandise to intermediaries who buy a certain quantity
4. Selecting Business And
Sales Force Promotion Tool
Business and Sales force
promotion Tools
Trade Shows And Conventions Sales Contests Specialty
Advertising
Trade Shows And Conventions
An exhibition for companies in a specific industry to showcase and demonstrate their new products and services.
Trade Fair in Delhi
Sales Contests
Aims at inducing the sakes force or dealers to increase their sales results over a period of time with prizes going to those who succeed.
Specialty Advertising
It consists of useful, low cost items bearing the company’s name. e.g key chains, ballpoint pens etc.
Developing The Program
Size
Duration
Incentives
Distribution Vehicle
Timing of the promotion
Total Sales Promotion
budget
5. Developing the programDetermine the size of incentive. A certain minimum is required for the promotion to succeed.
Incentives might be offered to everyone or to select groups
Decide duration of the promotion
A prize-off coupon can be distributed in a product package, in stores, online or by mail
6. Implementing and Evaluating the program
Implementation
Lead timeTime necessary to prepare
the program prior to launching it
Sell-in timeBegins with
promotional launch and ends when
almost 95% of the deal merchandise is
in hands of consumers
Evaluation
Sales Data
Consumers Survey
Experiments