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201 Cards in this Set
- Front
- Back
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Promotions Mix Components
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Advertising
Trade Promotions Sales Promotions Personal Selling |
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Trade Promotions
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Expenditures or incentives used by manufactures to help push product through to retailers
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Trade promotions aimed at...
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Retailers
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Difference b/t Sales/Trade Promotions
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Trade Promotions do not involved a sale to the end user.
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Trade Promotional Tools
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Allowances
Contests Incentives Programs Vendor Support Programs Trade Shows Specialty Advertising Point-of-purchase displays |
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Manufactures spend...
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More money of trade promotions than any other promotional tool.
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Trade Allowances Example
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Off invoice
Drop Ship Slotting fees Exit Fees |
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Trade Allowance
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Purpose is to offer financial incentives to other channel members to call them to buy more.
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Problems with Drop Ship Allowance
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Manufactures may not have enough space.
Manufactures now have to ship to several locations. Wholesaler may drop manufacturer |
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Drop Ship Allowance
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Paid to retailers who bypass wholesalers or brokers.
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Off-Invoice Allowance
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Per-case rebate
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Slotting Fees
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Money paid to retailers to stock a new product
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Exit fees
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Money paid to retailers to remove and item from inventory
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Slotting fees are...
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Unfair to small manufactures
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Disadvantages to Trade allowances
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Failing to pass along discounts to customers
Forward Buying Diversion |
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On-Deal
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passing along trade allowances
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Forward buying
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Retailers buy a lot of a product when it is on-deal
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Carrying charges
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Additional costs of holding inventory
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Diversion
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Retailer purchases a product on deal then ships it to a place where it is off-deal
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Trade Allowances Importance
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Very important
Manufactures must grant trade allowances to succeed |
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Spiff Money
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Rewards as contest prizes given to:
Brokers v Broker Wholesalers v wholesaler Retail v retail retail chain v retail chain individuals v others |
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Trade Incentives
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Purpose is to encourage either increase purchases by retailer of a brand or to push the brand
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Trade incentive differs from trade allowance because....
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Retailers must do something to receive allowance
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Cooperative Merchandising Agreement
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Annual incentive contract
Calendar Promotions |
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Corporate sales program
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A promotion across a company's entire portfolio
Ready to display pallets |
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Product Plant Allowance
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Incentive to retailer to purchase full or half truckloads of goods
Truck sales |
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Back haul Allowance
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Money paid to retailers that use own trucks to pick up goods
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Cross-dock/Pedal Runs
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Money paid to a Retailer for ordering a full truck to be distributed to other stores
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Premium/bonus pack
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Free cases of merchandise for placing an order
Packaging problems |
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Trade Incentives (Logistics)
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Producing Plant allowance
Back haul Allowance |
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Training program reason
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Having additional knowledge of a product will bias those people towards it
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Vendor Support Program
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Trade Promotion when manufacturer offers to help retailer or wholesaler problems
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Billback
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Manufacturer pays the retailer for special product displays, ads, or price cuts
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Advantages of billbacks
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Retailer is willing to perform function for the manufacturer
Manufacturer is billed only for the support program |
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Cooperative advertising program
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manufacturer agrees to reimburse retailer on a certain percentage of advertising costs
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Types of Vendor supports
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Billback
Co-op ad program |
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Horizontal Cooperation
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Several stores come together to promote a sale
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Vertical Cooperation
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Brand help pays ads for a certain store
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Top Category in advertising specialties
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Apparel
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Co-op % claimed
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only two-thirds
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Reasons why co-op isn't claimed
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Manufacturer rejects claims because of errors in filing
Purchases tracked inaccurately Retailers are unaware of co-op Restrictions placed by manufacturer are not followed |
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B2B marketing #3 expenditures
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Trade Shows
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Trade Show (manu)
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Opportunity to discover new customers
Sell new products Relationships of current customers can be strengthened See competition Strengthen brand name |
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Trade Show (retail)
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Compare merchandise
Make contact with vendors Negotiate deals |
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Prospecting
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Narrowing a large number of contacts to those most promising
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Specialty Trade Shows are better when:
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Establish a client base quickly
Establish a new brand Promote a product |
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Specialty Advertising
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Giveaways
Gifts such a pens, mugs, keychains. |
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Reciprocation
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Human desire is to return favor when we get a gift
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Point of Purchase increase sales when they have
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Brand signs
Base wrap under display base of support an inflatable component tie in to a sport, movie, or charity |
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Three POP trends
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Integration with web site programs
Displays that routinely change messages Better tracking of POP results |
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Concerns about trade promotions
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Cost
Consistent with IMC Plan Over-reliance to push merchandise ofter short term results erosion of brand image impact on small manufacturers |
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Consumer Promotions
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Incentives aimed at a firm's customers
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Two categories of Consumer Promotions
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Consumer franchise building promotions
Consumer sales building promotions |
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Consumer Franchise building promotions
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Designed to increase the awareness of and loyalty of a brand
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Consumer Sales building promotions
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Focus on immediate sales
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Types of consumer promotions
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Coupons
Premiums Contests and Sweepstakes Refunds and Rebates Sampling Bonus Packs Price Offs |
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Coupon
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Price reduction offered to a consumer
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Free standing Inserts
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Sheets of coupons distributed in newspapers
#1 form of coupon |
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FSI chosen over print media because....
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Consumers clip coupons
create brand awareness Encourages purchase |
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Types of coupons
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Instant redemption coupons
Bounce back Scanner delivered coupons cross ruffing response offer coupons Electronically delivered coupons |
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Instant redemption coupons
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Highest % used
Distributed in store |
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Bounce back Coupons
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inside packaging
cannot redeem instantly |
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scanner delivered coupons
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Triggered by scanner
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Cross ruffing
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A coupon on a package of a product that is for another product
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Response offer coupons
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Issued following request by consumer
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Electronically delivered coupons
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Internet delivered
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Of all coupons...
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Less than 2% are redeemed
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Problems with coupons
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Reduced revenues
mass cutting counterfeiting misredemptions |
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#1 method of distributing coupons
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Print media
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Factors facing coupon effectiveness
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Face value of coupon
distribution method preferred brand or brand in evoked set |
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Influencing brand behavior
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Sampling is #1
Contests last |
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Premium
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Prizes, gifts or special offers a consumer receives when purchasing a product
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Types of premiums
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Free in the mail premiums
in or on packages premium store or manufacturer premium self liquidating premiums |
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Free in the mail premiums
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Gifts individuals receive by mail for buying a product
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in or on packaging premiums
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small gifts, like toys in cereal boxes
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Types of customers
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Promotional prone customers
brand loyal customers price sensitive customers |
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Store or manufacturer premium
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a gift given by a retail store or manufacturer to a customer for buying a product
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Self liquidating premium
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consumer must pay money to received gift
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Promotional prone customers
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Regularly respond to coupons, price offs and premiums
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Two problems with premiums
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short life span
Cost |
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Cost of premium
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Lower cost- less interest
Higher cost- more sales but more cost |
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Keys to successful premiums
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Match to target market
Carefully select premiums reinforce product and image integrate IMC tools Dont use increase profits |
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Brand loyal consumers
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does not substitute
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Contest
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Requires participation and may require purchase
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price sensitive consumer
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Price is primary criterion for purchase
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Sweepstakes
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Just fill out out, no purchase
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Successful contest or sweepstakes
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Know legal restrictions
The right combo of prizes Extrinsic and Intrinsic values special events or tie ins with other companies use internet coordinate with other marketing tools |
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Overlay
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combining two or more consumer promotions
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Extrinsic value
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Worth, value
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Intrinsic Value
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Fun, happiness, inside body
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Refund
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Offer to return cash to customer
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Intracompany tie in
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promotion of two different product within one company
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Problems with contests or sweepstakes
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Costs
Consumer indifference Clutter |
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Intercompany tie in
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two companies combine promotions
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Rebate
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Typically larger than refund, consumer also receives cash
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Slippage
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Consumers forget about mail in rebates
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Types of sampling
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In store distribution-Sams
Direct Sampling- door to door Response sampling- request sample Cross ruff sampling- sample for another product Media sampling- w/ managers professional sampling- dentist/toothbrush Selective sampling- pinpoint target audience Internet based sampling |
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% of B2B marketing spent on sales promotions
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18.7%
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Creating effective rebate
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Visibility
Perceived newness an impact |
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Disadvantage of sampling
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high cost
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International consumer promotions
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Difficult to centralize consumer promotion programs
laws across countries difference in distribution rate Requires an experience international sales coordinator |
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Bonus packs
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additional number of items added in a package
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B2B consumer promotions
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Coupons
premiums sweepstakes/contests sampling bonus packs price-offs |
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Reasons for bonus packs
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Increase usage
match or pre-empt competitive actions Stockpiling develop loyalty attract new users encourage brand switching |
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Problems with bonus packs
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When small, consumers believe price has not changed
When large, consumers believe that price went up may slow cash flows |
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What Bonus packs do
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Maintain loyalty and increase brand switching
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Price-off
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temporary reduction in price
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Characteristics of a price off
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Boost short term sales
generate customer traffic easily implemented avoid increasing consumer price sensitivity avoid detrimental impact on image |
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Impact of a price off
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51% unaware of the price off
40% would have purchased it anyway 9% bought because of sales price |
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Public relations department
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unit of the firm that manages items such as publicity and other communications with all groups
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Problems with price off
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decrease in profits
increase in consumer price sensitivity |
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Hit
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the mention of a company's name in a news story
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Price offs are successful because
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appeal to money savings
rewards are immediate |
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Public relations
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achieve effective relationships in order to manage image and reputation of the organization
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Sponsorships
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Company contributes to the expense of a cause or event to increase the perceived value of a sponsor's brand
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Public relations functions
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Monitor internal and external publics
assess corporate social responsibility audit corporate social responsibility create positive image building activities prevent or reduce damage |
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Advertising equivalence
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How many hits or how much time=how much money it would have cost to advertise that much
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Stakeholder
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person with a vested interest in the organization's well being
either internal or external |
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Organizations need...
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Ethical guidelines
codes of ethics ethical hotline |
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Altruistic Activities
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Largely internal
Designed to build goodwill with both internal and external publics |
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Cause related marketing
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when a firm ties a marketing program in with some kind of charity work
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Benefits of cause marketing
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Additional customers
increased profits consumer goodwill for the future better relations with government agencies reduced chances of facing lawsuits |
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Cause consumers prefer the most...
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Improve public schools
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Green marketing
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development and promotions of products that are environmentally friendly
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Crisis management
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Accepting the blame and offering an apology, or refuting charges in a forceful manner
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crisis steps
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advance preparation for any crisis
recognize the crisis contain the crisis resolve the crisis build and advantage from the crisis |
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Apology strategy
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used when the investigation reveals the firm is at fault
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Apology steps
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Expression of guilt
recognize appropriate behavior reject inappropriate behavior approval of the appropriate offer compensation |
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Proactive strategies
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Entitling
Enhancements |
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Entitling
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Attempts to claim responsibility fo positive outcomes of events
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Enhancement
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Increase the desirable outcomes of an event in the eyes of the public
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Reactive strategies
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Internet interventions
crisis management apology strategies impression management |
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Internet interventions
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Combating negative mouth-to-mouth communication by entering chat rooms
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Impressions management
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control projected images
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Remedial tactics
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Expression of innocence
Excuses justifications other explanations |
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Expression of innocence
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provide information to convince others that not associated with the event that caused the predicament
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Excuses
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designed to convince the public that the firm was not responsible
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justifications
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logic to reduce the degree of negativity associated with the predicament
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Other explanations
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Created to persuade the predicament is not a fair representation
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Sponsorship marketing objectives
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Enhance image
increase visibility differentiate a company or brand showcase g/s Develop relationship with customers unload inventory |
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Most likely to buy a sponsor's product
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NASCAR
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Social responsibility
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obligation an organization has to be ethical and meet the needs of the society
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Puffery
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exaggerated claim
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To maximize event marketing
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determine objective
match event with customers cross promote include company in all promotions track results evaluate investment after event |
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Entrepreneurship:
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Goal of becoming larger.
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Intrepreneurship:
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Corporate spin-off/start-up.
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Small business:
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Family owned company or consortium of professionals. Growth not as important as income
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TYPES OF VENTURES
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Entrepreneurship:
Intrepreneurship: Small business: |
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MAJOR CHALLENGES of ventures
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Consumers are not aware
Consumers cautious Advertising and promotional clutter Small budget Negative word-of-mouth communications |
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STARTING A COMPANY:
THE MARKET ANALYSIS |
Understand and define consumer needs
Establish a clearly defined product Develop a unique market niche |
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TARGET MARKET
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Market Niche
Consumer or Business Needs Good/Service |
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Guerrilla marketing:
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Low-cost, creative marketing strategies.
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Lifestyle marketing:
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Grass-roots contact points for potential customers
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ADVERTISING SMALL BUSINESSES
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Develop a creative brief
Design advertising that speaks clearly and effectively Spend money on ad quality |
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Using Television
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Cooperative advertising – vertical or horizontal
Rotate times shown on cable |
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Using Radio
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Production costs can be low if a DJ reads the copy
Geographic segmentation Knowledge of listening audience |
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Using Newspaper
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Costly compared to local cable TV & radio
Volume discounts Target audience of baby boomers or older Best for geographic area around one store |
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Using Magazines
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Limited uses for local businesses
Sometimes regional editions Internet businesses may find magazines beneficial Can be highly targeted |
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Using Billboards
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Low CPM
Long-term exposure Excellent for brand awareness Match location with target audience Transit ads Advertisements on the store |
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Using The Internet
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Chamber of Commerce sites
City’s site Visitor’s bureau site Other business’ site |
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Help Customers Reach The Company
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Traditional Methods
Networking Lifestyle Marketing Web sites |
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Traditional Methods
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Phone number – spell out words or sequence of numbers
Mail and email |
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Networking
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Positive word-of-mouth
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Lifestyle Marketing
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Booth at a special event
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Web sites
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Easy to remember address
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Reduce Purchase Risk
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Samples
Coupons Price discounts Referral discounts Free first visits Money-back guarantees |
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Database Management
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Collect business cards
Information from personal checks Information at the time of purchase Record to a purchase history |
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Direct Marketing
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Define goals and audience
Target customers who want to be contacted Simple, direct, professional Print and mail the package Track responses |
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Personal Selling
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Know names of customers
Know preferences Uncaring and unprepared may cost business |
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Message Evaluation Techniques
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Examine creative message and physical message
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Evaluating Respondent behavior
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Address visible consumer actions
Store visits, purchases |
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Levels of analysis
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Short term outcomes
Long term results product specific awareness awareness of the overall company affective responses |
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Message evaluations
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Concept testing
copytesting Recall tests recognition tests attitude and opinion tests emotional reaction tests physiological arousal tests persuasion analysis |
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Concept testing
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Actual content and impact on consumers
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Copytests
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used when the marketing piece is finished or in its final stages
solicit responses to the main messages |
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portfolio test
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display of a set of print ads
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theater test
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display of tv ads
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mall intercept technique
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random people evaluate the product
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recall test
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recall an ad
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day after recall
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most common recall test
people are called the day after an ad is run |
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unaided recall
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no prompts
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aided recall
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promted
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Unaided is...
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better than aided
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recognition tests
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format with individuals are given copies of an ad and asked if they recognize it
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Recognition tests and Recall tests
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Recog- how many people saw an ad
Recall- how many plus how interested |
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Closed end Qs
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scales of multiple choice
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Open ended Qs
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allowed to discuss
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warmth monitor
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measure emotions, positive feelings
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four lines of warmth meter
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absence of warmth
neutral warmhearted or tender emotional |
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Warmth is used for...
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TV, but also radio
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Physiological tests
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psychogalvanometer-sweat measure
pupilometric test voice pitch analysis |
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PACT
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principles to evaluate TV ads
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Behavioral Evaluations
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Deal with actual sales
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List of behavioral measures
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Sales
Redemption rates test markets purchase simulation |
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Advertisements are...
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difficult to evaluate
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POPAI
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point of purchase analysis
low cost |
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response cards
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customer fill out cards
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Test Market programs are used to assess:
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Ads
promotions and premiums pricing tactics new products |
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Scanner data...
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quickly available
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Evaluating Public Relations
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Counting clippings
calculating the number of impressions the advertising equivalence |
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Evaluating the IMC Program
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Market share
level of innovation productivity physical and financial resources profitability manager performance employee performance social responsibility |
