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SALES PROMOTION
All those promotional activities which are undertaken to stimulate interest, trial or purchase of a product by the end user or other intermediaries in between. The main methods of sales promotion are: Money off coupons customers receive coupons, or cut coupons out of newspapers or a products packaging that enables them to buy the product next time at a reduced price for example; Tesco price cut.

Competitions Buying the product will allow the customer to take part in a chance to win a prize e.g. Coca Cola ring pulls, Power root: everyone can be the millionaire.

 Discount vouchers a voucher like a money off coupon. Free gifts a free product when buy another product such as Scott emulsion at Watson, free bag with the purchase of Scott emulsion. Point of sales materials e.g. Milo posters and display stands ways of presenting the product in its best way or show the customer that the product is there. Loyalty cards e.g. Nectar and Air Miles; where customers earn points for buying certain goods or shopping at certain retailers that can later be exchanged for money, goods or other offers.

WHAT SALES PROMOTION CAN DO?

Stimulate sales force enthusiasm for a new, improved, or mature product. Exciting sales promotion gives salespeople persuasive ammunition when interacting with buyers, revive enthusiasm, and make the job easier and more pleasant. Invigorate sales of a mature brand. Sales promotion cannot reverse the sales decline for an undesirable product, but can invigorate sales of a sound although mature product. Facilitate the introduction of new products to the trade. To achieve sales and profit objectives, marketers continually introduce new products and add news brands to existing categories, so the sales promotions allows the introduction of the new products to the market.

 Increase product usage by loading consumers. Sales promotion is to encourage consumer stockpiling, it is to influence consumers to purchase more of a particular brand than they normally buy. Consumers tend to use more of certain products when more of the product is in their homes.
Preempt competition by loading consumers. When consumers are loaded with one companys brand, they are temporarily out of the marketplace for competitive brands. Hence, one brands promotion serves to preempt sales of competitive brands. Reinforce advertising. A final can do capability of sales promotion is to reinforce advertising. An advertising campaign can be strengthened greatly by a well- coordinated sales promotion effort.

 Obtain trial purchases from consumers. Many consumers would never try new products without the inducement of free samples or coupons.
Hold current users by encouraging repeat purchases. The strategic use of certain forms of promotion can encourage at least short run repetitive purchasing. Such as refunds, premium programs and so on that useful for encouraging repeat purchasing.

Increase on- and off-shelf merchandising space. Enable the manufacturer to obtain extra shelf space or more desirable space for a temporary period.
Neutralize competitive advertising and sales promotion. Sales promotion can effectively offset competitors advertising and promotions efforts.

Air Asia practices of sales promotion

Air Asia launches low fare madness promotion on all seats and all flights departing primarily from Malaysia, the promotion which begin on 5 October and run until 11 October 2009and for travel between 12 October and 19 November 2009 Air Asia launches the Mega sale promotion that offer special low fares for its domestic, regional, and international routes. Some 250,000 seats are available in this promotion from its hubs in Kuala Lumpur, Johor Bahru, Kota Kinabalu and Kuching.

 Air Asia grand sales

 Air Asia also offers fares promotion with flight from Melbourne, Perth and the Gold Coast of Australia to Malaysia available from just A$ 119 one way . Air Asia also offer rebate for their customers, for example; Air Asia X yet to see 50percent landing rebate for the customers Air Asia also gives the free seats to the customers as the services trial. For example, Air Asia gives the 8,888 free seats to Hangzhou; Air Asia offers 1,000,000 free seats in a bid to boost domestic travel, Air Asia offers the no fuel surcharges to the passenger

 Air Asia loyalty card with HSBC

AIR ASIA TICKET DISCOUNTS

video

THE ROLE OF TRADE PROMOTION

Trade promotion is a key activity in every marketing plan. It is aimed at increasing sales in the short term by employing promotion schemes which effectively increases the customer awareness of the business and its products. Even though trade promotion do not always work the way the are designed to, manufacturers have legitimate objectives for using trade-oriented promotions.

The objectives include:1) Increasing distribution of new packages or sizes 2) Building retailer inventories 3) Maintaining or increasing the manufacturers share of shelf space 4) Obtaining displays outside normal shelf location 5) Introducing new or revised products 6) Reducing excess inventories and increasing turnover 7) Achieving product features in retailers advertisements 8) Countering competitive activity 9) Selling as much as possible to final consumer

Ingredients for a Successful Trade Promotion Program

1) Financial incentive A manufacturers trade promotion must offer wholesalers, retailer, and other channel intermediaries increased profit margins, increased sales volume, or both. 2) Correct timing Trade promotions are appropriately timed when they are :a) Tied in with a seasonal event during a time of growing sales b) Paired with a consumer-oriented sales promotion c) Used strategically to offset competitive promotional activity. 3) Minimize the retailers effort and cost The more effort and expense required, the less likely it is that retailers will cooperate in a program they see as benefiting the manufacturer but not themselves. 4) Quick results The most effective trade promotions are those that generate immediate sales or increase in store traffic. 5) Improve retailer performance Promotions are effective when help the retailer don a better selling job or improve merchandising method as, for example, by providing retailer with improved displays.

TRADE ALLOWANCES
Used by manufacturers, in theory, to reward wholesalers and retailers for performing activities in support the manufacturers brand. Also called trade deals, encourage retailers to stock the manufacturers brand, discount the brand price to consumers, feature it in advertising, or provide special display or other point-of-purchase support. Manufacturers hope to accomplish two interrelated objectives:a) Increasing purchases of the manufacturers brand by wholesalers and retailers b) Augment consumers purchases of the manufacturers brand from retailers. This latter objectives is based on expectations that consumer are receptive to price reductions and that retailer will in fact pass along to consumers the discount they receive from manufacturers.

Major Form of Trade Allowances

a) Off-invoice allowances
a deal offered periodically to the trade that literally permits wholesalers and retailers to deduct a fixed amount from the invoice. a form of trade allowance in which retailers receive allowances for featuring the manufacturers brand in advertisement (bill-back allowances) or for providing special displays (bill-back display allowances). the fee manufacturers pays a supermarket or other retailer to get that retailer to handle the manufacturers new product. the allowance is called slotting in reference to the slot, or location, that the retailer must make available in its warehouse to accommodate the manufacturers product.

b) Bill-back allowances

c) Slotting allowances

Effort to Rectify Trade Allowance Problems

Efficient Consumer Response (ECR) -a broad-based concept of business management that is oriented toward enhancing efficiencies and reducing cost in the grocery industry. The several of the ECR initiative is :i. Improved product replenishment practices. ii. Reduced trade promotion iii. Improved product introductions Category Management -involves the working relationship between manufacturers and retailers and attempts to find ways whereby both parties can be more profitable. There are five interrelated stages:i. Reviewing the category ii. Targeting consumers iii. Merchandise planning iv. Implementing the strategy v. Evaluating result

CONT..
Everyday Low Pricing (EDLP)
a form of pricing whereby a manufacturer charges the same price for a particular brand day in day out. Involves charging the same price over an extended period.

Pay-for-Performance Programs
A form of trade allowance that rewards retailers for performing the primary function that justifies a manufacturers offering a trade allowance. Are designed to reward retailer for selling the manufacturers brand supported with a trade allowance rather than for merely buying the brand at an off-invoice price.

Customizing promotions: Account-Specific Marketing

A descriptive term that characterizes promotional and advertising activity that a manufacturer customizes to specific retail accounts; also called co-marketing.

Generalizations About Promotions

1) Temporary retail price reductions substantially increase sales-but only the short term. 2) The greater the frequency of deals, the lower the height of the deal spike. 3) The frequency of deals changes the consumers reference price. 4) Retailers pass through less than 100 percent of trade deals. 5) Higher-market-share brands are less deal elastic. 6) Advertised promotions can result in increased store traffic. 7) Feature advertising and displays operate synergistically to influence sales of discounted brands. 8) Promotions in one product category affect sales of brands in complementary and competitive categories. 9) The affects of promoting higher and lower-quality brands are asymmetric.

SAMPLING
The definition: Any method used to deliver an actual or trial-sized product to consumers for purposes of generating trial or retrial and leveraging trade support.

DISTRIBUTION METHODS
Direct Mail Newspapers and Magazines Door-to-Door sampling by Distribution Crews On-or In-pack Sampling High-Traffic locations and events Sampling at unique venues In-store Sampling

EXAMPLE
Air Asia give offer free seats to their customers as sample on their services. The free seats are offers through the others sales promotion methods.

OTHER EXAMPLES
1 3

COUPONING
A coupon is a promotional device that rewards consumers for purchasing the coupon-offering brand by providing either cents-off savings or free merchandise.

CONT..
Coupons are delivered through : Newspapers Magazines freestanding inserts direct mail in or on package Online point of purchase shelf electronic delivery services.

Coupons are used:

Introduced new or improved product; Maintain or increase market share; Reduce product inventory in order to introduce new product, size or package; Attract first-time users in an effort to convert them into regular buyers; Soften price increases; Increase product awareness and brand switching; Develop retail support with increase shelf space, store displays and support sales staff.

CONT..

CONT..

PREMIUM
Premium can be define as a charge paid in addition to normal payments or a marketing term for a something given free with the purchase of a product or service. Premium include in several forms : Free with purchase premiums Mail in offers In,on,near-pack premiums Self liquidating offers Phone cards

Free with purchase premiums

Free with purchase premiums or free gifts are provided by the marketers of durable good that to give to customer of the products that to generate trial purchase.
Consumer also will get the free savers octo soft toy when the consumer had open a CIMB Bank AirAsia savers account with a minimum initial deposit of RM1,000.

Mail in offers
The offer are premium promotions in which the customer collects one or more proofs of purchase and sends them in for the item on offer entirely free or at no cost beyond postage. The benefits is delayed and not immediately. It is also subject to action on the part of the consumer after purchasing the item.

Mail-in offer

FREE NOKIA Phone! Apply for AirAsia-Citibank card NOW!

Exclusive for AirAsia-Citibank Cardmember

In,on,near-pack premiums
In-pack premium A small, often low value, gift placed inside a product package to encourage purchase or reward the purchaser on-pack offer the offer is a form of premium promotion in which the premium is physically attached to the product.

AAX In-flight Entertainment

Flying long-haul soon? Be captivated with the latest movies, TV shows, music and games brought to you by Xcite, our exclusive in-flight entertainment system.

Self liquidating offers

Self-liquidating premium is a premium offer paid by the consumer whose total cost including handling fees are paid for in the basic sales transaction.

Pick a seat
video

Now you can pick your favourite seat when you fly with us! You don't have to worry about rushing for your favourite spot onboard anymore.

Phone cards
Phone cards is a unique type of premium offer that give the promotions incentive that focus on repeat purchasing objective and provide with delayed reward.

E-Gift Voucher
If youve recently purchased E-Gift Vouchers, heres how you can redeem your voucher.

E-Gift voucher

Other promotional methods

Price off Bonus packs Games Rebates and refunds Sweepstakes and contest Continuity promotions Overlay and tie-in promotions Retailer promotions

Price off
Price off A stated reduction in the price of a product generally offered by the manufacturer and printed directly on the product package.

Bonus packs
Bonus packs are the extra quantities of a product that a company give to consumer at regular price.

Baggage supersize

Games
Games that provide consumers with an instant reward that encourage repeat purchasing from existing brands users.

Rebates and refunds

A rebate is an amount paid by way of reduction, return, or refund on what has already been paid or contributed. It is a type of sales promotion marketers use primarily as incentives or supplements to product sales.

Sweepstakes and contest

Sweepstakes or simply sweeps have become associated with marketing promotions targeted toward both generating enthusiasm and providing incentive reactions among customers by enticing consumers to submit free entries into drawings of chance (and not skill) that are tied to product or service awareness wherein the featured prizes are given away by sponsoring companies. A contest is an event in which two or more individuals or teams engage in competition against each other, often for a prize or similar incentive.

contest
AirAsia's Photos - Send Me Back to Chengdu Photo Voting Contest CIMB Bank AirAsia Savers Account

Continuity promotions
Continuity promotions that promotions sometimes reward consumer repeat purchaseing of a particular brand by awarding point leading to reduces prices or free merchandise and referred to as loyalty or point programs. This program will encourage consumer to stick with a particular company to accumulate requisite numbers of points as quickly as possible.

Overlay and tie-in promotions

Overlay is use of two or more sales promotion technique or combination programs. Tie-in is the simultaneous promotion of multiple brands in a single promotion effort or group promotions.

PUBLIC RELATIONS AND SPONSORSHIPS

Public relations (PR) are the practice of managing the communication between an organization and its public.
Topics of public interest and news items Common activities include speaking at conferences, working with the press, and employee communication.

Two types of public relations: proactive and reactive

Proactive public relations-staying involved with company publics and looking for opportunities to demonstrate good will.
TYPES OF PROACTIVE PUBLIC RELATIONS PRODUCT RELEASES EXECUTIVE- STATEMENT RELEASES FEATURES ARTICLES

1. 2. 3.

REACTIVE PUBLIC RELATION

Unanticipated marketplace developments can place an organization in a vulnerable position that demands reactive MPR. In simple terms, bad things happen and unanticipated events sometimes occur that require a public relations response A RUMOR OR RUMOUR is often viewed as "an unverified account or explanation of events circulating from person to person and pertaining to an object, event, or issue in public concern

Sponsorships marketing
Sponsorship is the financial or in-kind support of an activity, used primarily to reach specified business goals. That means, sponsorships involve investments in events or causes for the purpose of achieving various goals

Types of sponsorships
1. Television and radio programme sponsorship for example; Cadburys sponsor broadcasts of Coronation Street. 2. Sports sponsorship: 3. Arts sponsorship;

4. Educational sponsorship(e.g. Tescos Computers for Schools

Benefits of sponsorship
Enhancing Image/Shaping Consumer Attitudes Driving Sales Enhancing business, consumer and VIP relations Creating positive publicity/heightening visibility Differentiating from competitors

Cause related marketing

Cause-related marketing entails alliances that companies form with nonprofit organizations to promote their mutual interests .

THE BENEFITS AND ADVANTAGES OF CAUSE-RELATED MARKETING

By supporting a deserving cause, a company can: 1. Enhance its corporate or brand image 2. Thwart negative publicity 3. Generate incremental sales 4. Broaden its customer base 5. Reach new markets segments 6. Increase a brands retail merchandising activity

AIR ASIA PRACTICES OF MARKETING ORIENTED: PUBLIC RELATIONS, SPONSORSHIPS AND CAUSE RELATED MARKETING PROACTIVE PUBLIC RELATIONS

services release, for example; AirAsia to launch two new services to Singapore.. Executive-statement. For example; Air Asia to see higher profit in 2009, this statement show that Air Asia release the future forecast of sale

Product Release- AIR ASIA launch 2 new services to Singapore

Executive-statement- Air Asia posts RM139m Q2 net profit

REACTIVE PUBLIC RELATIONS

The issues about the flight cancellation and also about the flight delayed. Air Asia handles the issues with their own Air Asia blogs that the customers can comments and sends any recommendation to them. For example Air Asia cancel JB-Macau flight The examples of issues are; the rude Air Asia staff in Australia, the sex scandal of Air Asia flight attendant

 Reactive public relation- flight arrivals, delays

 Flight attendants issues- sexy

SPORTS SPONSORSHIPS BY AIR ASIA

AirAsia chip in RM500, 000 for Asia Cup. Friday May 1, 2009

AirAsia sponsors BIM running vests, Friday 25 September 2009 Soccer-Malaysia's Air Asia ponders Man Utd shirt sponsorship

Williams confirms AirAsia Sponsorship

 Malaysia's Air Asia Sponsors NFL's Oakland Raiders

AirAsia Announces Sponsorship of English Referees

SPORTS SPONSORSHIP BY AIR ASIA

CAUSE RELATED SPONSORSHIPS

1. Sumatra EarthQuake: Airasia Helps Out With Charity Flight. 2. PT Indonesia airasia Gives Charity Flights for Padang 148 seats, Jakarta-PadangJakarta for free 3. 'Wow Day' treats for the underprivileged

4. AirAsia IJN Foundation Donate Your Loose Change Campaign

Air Asia sponsors IJN

WHY AIR ASIA INVEST IN MARKETING ORIENTED

Air Asia involve in sponsorship and Cause related marketing is to enhancing Air Asia Image..

Air Asia also wants to driving the sales or to create the brand awareness and increase brand image. For example; AirAsia sponsors BIM running vests, Friday 25 September 2009,

 Air Asia also wanted to create positive publicity of their brand. Air Asia Company wants differentiating their company from the competitors such as MAS. Air Asia Company helping with good "Corporate Citizen" role. Air Asia wants to be seen supporting the community and contributing to its economic development.

References
Sales promotion : how to create, implement and integrate campaigns By Roddy Mullin, Julian Cummins http://www.airasia.com http://www.youtube.com/amazingairasia http://www.flickr.com/photos/airasia http://twitter.com/airasiadotcom http://www.facebook.com/AirAsia http://blog.airasia.com/

TQ FOR LISTENING

QUSTIONS AND ANSWERS

PAST YEAR QUESTIONS

FACTORS CONTRIBUTING TO THE GROWTH OF SALES PROMOTION(3B APRIL 03)

1. First, consumers have accepted sales promotion as part of their buying decision criteria 2. Second, the increasing tendency of businesses to focus on short-term results has helped spur growth in sales promotion, which can provide an immediate boost in sales. 3. Third, the emergence of computer technology has enabled manufacturers to get rapid feedback on the results of promotions. 4. Finally, an increase in the size and power of retailers has also boosted the use of sales promotion

HOW CAN SALES PROMOTION REINFORCE A BRANDS IMAGE? IS THIS A MAJOR OBJECTIVE OF SALES PROMOTION (3C APRIL 03)

Reinforcing the Brand Once customers have made a purchase sales promotion can be used to both encourage additional purchasing and also as a reward for purchase loyalty (see loyalty programs below). Many companies, including airlines and retail stores, reward good or preferred customers with special promotions, such as email special deals and surprise price reductions at the cash register.

THE STREGHTHS OF PUBLICITY COMPARED TO ADVERTISING (3B OCT 03)

Enhance your sales. Increased exposure in the media makes people want to find out more about you, your company and your products and services. Position you as an expert in your field. When you are quoted by the media, your expert opinion can put your name, and your companys name, in the spotlight. Public relations will build your reputation and earn you credibility with clients and potential clients. Increase visibility. Once you begin to appear in the mediaquoted in articles, on television, on radiopotential clients and customers will begin to associate you and your company as a leader in the field. Why? Because they saw you or heard you or read your name in the media.

 Get product reviews. Increase your perceived worth. Whether you are a public company or a private company, media placementsinterviews on radio and TV and in print increase your perceived worth, and the worth of your company, in the eyes of your customers, clients and your industry. All because of media exposure. Tell your side of the story. Politicians arent the only ones who have opinions on issues. In every industry, including politics, there are issues that need to be aired. If your competitor tells one side of the story, public relations makes sure you voice your opinion.

 Outwit your competition. How often have you seen a guest being interviewed over and over again, even though their products or services arent necessarily the best in the business? Thats effective public relations. Shouldnt you be quoted in articles and interviewed on TV and radio so you have a leg up on your competition? Avert a crisis. There are times when bad things happen to good people. How do you manage a crisis? With persistent, consistent public relations. Tell the truth, tell it all, tell it fast, is Gaye Carletons motto for crisis management.

DISCUSS THE STREGHTS AND LIMITATIONS OF SALES PROMOTION FOR THE MARKETING COMMUNICATOR (4BOCT03)

The strengths of sales promotion Stimulate sales force enthusiasm for a new, improved, or mature product. Exciting sales promotion gives salespeople persuasive ammunition when interacting with buyers, revive enthusiasm, and make the job easier and more pleasant. Invigorate sales of a mature brand. Sales promotion cannot reverse the sales decline for an undesirable product, but can invigorate sales of a sound although mature product.

 Facilitate the introduction of new products to the trade. To achieve sales and profit objectives, marketers continually introduce new products and add news brands to existing categories, so the sales promotions allows the introduction of the new products to the market. Increase on- and off-shelf merchandising space. Enable the manufacturer to obtain extra shelf space or more desirable space for a temporary period. Neutralize competitive advertising and sales promotion. Sales promotion can effectively offset competitors advertising and promotions efforts.

 Obtain trial purchases from consumers. Many consumers would never try new products without the inducement of free samples or coupons.
Hold current users by encouraging repeat purchases. The strategic use of certain forms of promotion can encourage at least short run repetitive purchasing. Such as refunds, premium programs and so on that useful for encouraging repeat purchasing. Increase product usage by loading consumers. Sales promotion is to encourage consumer stockpilling, it is to influence consumers to purchase more of a particular brand than they normally buy. Consumers tend to use more of certain products when more of the product is in their homes.

 Preempt competition by loading consumers. When consumers are loaded with one companys brand, they are temporarily out of the marketplace for competitive brands. Hence, one brands promotion serves to preempt sales of competitive brands.
Reinforce advertising. A final can do capability of sales promotion is to reinforce advertising. An advertising campaign can be strengthened greatly by a well- coordinated sales promotion effort.

The limitations of sales promotion

Inability to compensate for a poorly trained sales force or for a lack of advertising When suffering from poor sales performances or inadequate growth, some company consider promotion to be the solution. However, promotions will provide at best a temporarily fix if the underlying problem is due to a poor sales forces, a lack of brand awareness, a weak brand image or other maladies that only proper sales management and advertising efforts can overcome. Inability to give the trade or consumers any compelling long-term reason to continue purchasing a brand. The trade decisions to continue stocking a brand and consumers repeat purchasing are based on continued satisfaction with the brand. Satisfaction results from the brands meeting profit objectives and providing benefits for consumers. Promotions cannot compensate for a fundamentally flawed or mediocre brand unless the promotions offset the flaws by offering superior value to the trade and consumers.

 Inability to permanently stop an established brand's declining sales trend or change the basic nonacceptance of an undesired product. Declining sales of a brand over an extended period indicate poor product performance or the availability of a superior alternative. Promotion cannot reverse the basic no acceptance of an undesired brand. A declining sales trend can be reversed only through product improvements or perhaps an advertising campaign that breathes new life into an aging brand. Promotions used in combination with an advertising efforts or product improvements may reverse the trend, but sales promotion itself would be a waste of times and money when a brands is in a state of permanent decline.