Sales Promotion

The wonders and the wounds

Promotion Mix /
Communication Mix (PR)
2 Sales Promotion
2 PR
2 Selling
2 Advertising
2 Below the line
2 Above the line
Two Types of Sales Promotion
2 Consumer Promotion
2 Trade Promotion
!hat do we want the
consumers and trade to do?
2 Buy More
2 Buy Now
A sales promotion should
be
2 Temporary ² if not the consumers
would not believe it the next time
2 Great Value Added ² they should
find reason to buy now and more
Trends on Sales Promotion
2 ¾ of the marketing budget is allocated
to sales promotion
2 In 1995, 51% of total adspend represents
trade promotions. 24% on media
spending 22% on consumer promotion
2 Growth in the coupon segment is
tremendous in aspirational markets
2 Americans redeem more than 7 billion
coupons annually.
!hy the Growth???
2 Instant results
2 Faster implementation
2 Measurable
2 Relatively easy and inexpensive
The Downside of Sales
Promotion
2 Brand Erosion
2 Profitability increase is relatively low
2 Implementation cost and problems
2 Orients marketing managers
towards short term results
!hat a sales promotion
should be«.
2 Lets go back to the basics
2 Should hit the consumer at a particular
behavioral stage
2 Are marketing communication activities
that change the price/value relationship
of a product / service perceived by the
target
2 Generating immediate sales
2 Altering long term brand value
Planning Sales Promotion
2 !ho is our target set of consumers?
2 !hat is the reason for that behavior
2 !hat is the goal of the program
2 Is there a meaningful economics
attached to sales promotion
Types of Buyers
2 Loyals
2 Buy a particular brand on a more or less
consistent basis
2 Competitive loyals
2 People who are loyal to the competing
brand
2 Switchers
2 Purchase of various brands in one category
2 Price buyers
2 Non Users
Results that are needed «.
2 Loyals
2 Reinforce behavior
2 Increase consumption
2 Change buying timing
2 Competitive loyals
2 Break loyalty
2 Encourage brand switching
2 Switchers
2 Persuade to buy the ´rightµ brand more often
2 Price
2 Value added to make price less important
2 Non users
2 Create awareness, create category worth
Types of Sales Promotions
2 Coupon
2 Bonus Packs
2 In pack, On pack, and Near Pack
2 Specialty container
2 Continuity program
2 Refund
2 Sweepstakes
2 Contest
2 Through the mail Premium
2 Sampling
2 Price off
2 Trade deal
2 Cause related promotion
Coupons
2 Clip and bring to
the store to
exchange
2 Now it is phone
based
2 Induce loyalty
2 Repeat purchase
2 Keeps the
consumers
´lockedµ
Bonus Packs
2 Like bundle pricing
but this is
temporary
2 Adds value
In Pack, On Pack Promotion

2 It is used to
introduce
new products
/ service
2 Dispose of
excess
inventory
2 Use excess
overhead
Specialty Container
2 Increases
product·s
perceived value
2 Uy tignan mo ito
meron libreng
pitchel
Continuity Program /Loyalty
Cards
Refund / Rebate Promotion
2 If the product does
not perform, then
its money back
2 Or consume X
number of
products and get Y
FREE
2 Increases
consumer
confidence
2 Loyalty program
 Sweepstakes
2 Chance game
where the
consumer has
the chance to
win something
big through
purchases
2 The more
purchases, the
more tickets
2 Creates loyalty
Sampling
2 Used when the
consumer is
unaware of the
brand or product
2 Product buying is
prone to retail
channel based
trial
2 Use when the
product can be
broken down into
smaller
dimensions
Price off promotion
2 Use for slow
moving items
2 Excess
inventory
2 Off season
2 Dislodge
competitors
Choose the right promotion
for the right situation
Example
Problem Solution
New product Sampling, on pack promo

Consumers not loyal Rebates, sweepstakes, loyalty

cards
Competitors are attacking Price off, free goods,
the market with ads premiums, rebates, etc
Excess inventory

Shelf life is critical

Consumer Promotion
2 To induce immediate off take from
the shelf
2 To induce trial
2 To buy more of your products
2 To buy immediately
Trade Promotion
2 Encourages your trade channel to
load up
2 Move inventory from the company
to the warehouse of the trade
2 Distributor or Key Accounts
2 Deals with promotional tools for staff
and sales people who are involved
with the trade.
Sell in (PUSH STRATEGY)
2 Trade Promotion based on
2 Volume ² buy a certain volume to
attain a high discount
2 Prompt Payment ² pay on time and
get a discount
2 Free goods ² using new products or
slow moving products as promotional
items
Volume Promotion
2 It motivates the dealer to buy more
2 Example
2 10+1 promotion ² buy 10 boxes get
one free
2 Volume discounts
2 Bundle promotion ² feature a new
product as freebie
Advertising Promotion
2 Cooperative advertising
2 Coke and Julie·s Bakeshop
2 Lock in to the outlet to exclusively sell
your brand
Cooperative Promotion
2 a

2
  
 
 

2   
   

   
Co-branding
2 Can be a strategy
or a promotion
2 It increases margin
2 Synergizes strength
of two brands
2 Increases
profitability due to
the higher value
perception
Free Goods
2 Better
profitability
2 Moves higher
volume
2 Economies of
scale
Trade Advertising
2 Advertisements used as a basis for
booking sales
2 Rationale is consumers will look for a
brand that has ad support
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Massive advertising always leads

to higher trade acceptance

Trade will only stock items that will

sell
Personal Selling

Direct Selling
Distribution Selling
Outlet Selling
Direct Sales
2 One of the recent
trends in consumer
marketing
2 Direct hit to consumers
2 Smaller ad spending
Direct sales
2 Uses human capital as resource
2 Offering high earnings to those who
do not have businesses
2 Home based
2 People get people strategy
2 Very sound business model
How do they profit?
2 Gross Margin 40%
2 1st level Commission ² 10%
2 2nd level commission ² 8%
2 3rd Level commission ² 5%

2 AT this point, the company still earns

and yet the number of networks
grow«.
Direct Sales
2 Meaningful to sales people
2 The consumer saves money
2 Answer to the crisis of power of
retail channels
Distribution Selling
2 Sales efforts to cover geographic
region
2 Cover relevant distribution channels

2 Example:
2 Bonheur Marketing
Bonheur Marketing
2 Former exclusive distributor of
Marlboro and Philip Morris
2 Covers outlets such as
2 Supermarkets
2 Sari sari stores
2 Sub distriutors
2 Dealers
2 Luzon wide
BiC became better when«
2 Distribution was assigned to FilStar ²
an affiliate of National Bookstore
2 That·s why BiC enjoys great retail
presence in NBS
Public Relations
Advertising
Key things to remember
2 Creative brief
2 Copy strategy
2 Execution methods
2 Media
2 Media Planning
2 Success tracking
Creative Brief
2 Brand elements
2 Target segment
2 Reason to buy
2 Current behavior
2 Current perception
2 Desired impression
Copy Strategy
2 Tagline
2 Plot
2 Mood and Tone
2 Reason to believe
2 Execution
2 Media
2 Media Plan
Media Plan
2 Medium
2 Above the line
2 Below the line
2 Loading
2 Front
2 Back
2 Seasonal
2 Flat
Media
2 TVC
2 Print
2 Radio
2 Internet
2 CPM (clicks per million)
2 Ad click
2 Ad impressions
2 Banner or button advertisement
2 Click through
2 Cost per click
2 Spam
2 URL
Media
2 Billboard ² of course they will stay
2 Mall panels
2 Comfort ads
2 Transit ads
2 Non traditional
2 Corporate gifts
2 Leaflets
Media Plan
2 Using each medium optimally to
achieve brand objectives
2 It is all about making the right mix or
right allocation of budgets
2 Hitting consumers where it matters
most
Executions
2 Humor
2 MTV
2 Slice of life
2 Celebrity endorser
2 Testimonial
2 Image model ² can be a competent
looking person
2 Performance test
Just make sure they do not«
2 Laugh and forget which brand is
being advertised
2 Remember the story in the ad and
then forget about the brand
2 Remember the song and then«
ano nga palang brand yun?!
Things you should remember
2 Matrix or charts or altering S!OT with
TO!S analysis (which by the way is not a
marketing tool but a central
management tool) DON·T BUY THE IDEA
2 The basics still work ² and it will sans a
few alterations
2 IMC is integrating all communication
materials under one big idea
Remember
2 Life is a journey of learning
2 The moment you get cocky is the time
you die
2 Mistakes are best teachers
2 Do not believe all teachers too« some
of them have issues as well« pick good
mentors
2 Don·t label anything ² good or bad
2 Know thy Dharma ² know what you are
here for
Remember
2 Detachment is a great tool
2 Make yourself competent ² goal is
not to be employed but
employable
2 Don·t make yourself stagnant ²
even if your family or husband is rich
2 Have FAITH
Remember
2 PR competence is as important as
knowledge
2 Be the best you can ever be (not
Alipin Sagigigilid all your life)
Thank you for such a
wonderful semester« really