The Promotion Mix Promotion: influencing · Push-Pull Policy Trade Promotions Consumer Promotions...

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

Promotion: influencing

buying decisions Chapter 17

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

Opening Question

Have you ever

entered a contest by

a store or business to

win something?

Describe it.

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

What Is Promotion?

Promotion – any communication an

organization uses to:

• Inform

• Persuade or

• Remind

people about its products

• Also to improve the public image of

an organization

The Promotion Mix

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

The 2 Purposes Of Promotion

• Product promotion - Convince

market to buy a product

• Institutional promotion – Create a

favorable image for company

The Promotion Mix

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

The 5 Basic Types Of Promotion

1. Personal Selling

2. Advertising

3. Direct Marketing

4. Public Relations (PR)

5. Sales Promotion

- Direct Customer Contact

Non-personal /no direct customer contact

The Promotion Mix

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

1. Personal Selling

• Personal Selling - One of the largest

forms of promotion

–Most expensive form

• Make the sale after customer is

attracted by ads, sales promotion, or

PR

The Promotion Mix

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

2. Advertising

• EXAMPLES: Magazines, newspapers,

television, radio, web-sites

– One-way communication

The Promotion Mix

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

3. Direct Marketing

• Usually to a targeted group

• Two types:

– Printed

–Online

The Promotion Mix

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

4. Public Relations & Publicity

• Public Relations (PR)

Strategies to enhance company’s

reputation/image

• Publicity

– Part of PR and is the end result of PR

– End results = what makes headlines,

news, chat room, blogs (the media

placement)

The Promotion Mix

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

4. Public Relations & Publicity

Public Relations &

Publicity

Data Breach Troubling TARGET Customers bought less at Target as they felt

their credit/debit card security was compromised

Public Relations: Apologized for theft of information Assured zero liability for fraudulent

charges Implemented technological changes to

prevent recurrence of such an event in the future

Changed Top Management

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

Advantages of Publicity

• It’s free

• “News” is usually viewed as more

objective and credible than

advertising

• People more likely to pay attention

to news than ads

Public Relations &

Publicity

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

Disadvantages of Publicity

Unlike paid advertising, company has

no control over:

• The content or what is said

• When something is said

TACO BELL “Seasoned Meat” Lawsuit

2011

Public Relations &

Publicity

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

5. Sales Promotion

• Sales Promotion – All marketing

activities, other than the prior four.

– Product Placement

– Contests

– Etc.

• Will be discussed in 17.2

The Promotion Mix

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

Promotional Mix

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

Coordination of Promotional Mix

• Use more than one type of promotion

• Each should complement other types:

– Ads and direct mail create awareness

– PR creates positive image and

recognition

– Sales promotion create sales and

reinforces

– Personal selling closes the sale

The Promotion Mix

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

Opening Question

What types of events are held in our

community to build the image of a

company?

What are the goals of these events?

Give specific examples.

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

Opening Question

What types of promotions could a

company offer ANOTHER company

(B2B) to entice them to carry their

products. Provide examples with

specific company/products.

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

Sales Promotions Chapter 17.2

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

Sales Promotion

• Sales Promotions - Incentives that encourage

customers to buy

• Used to:

– Try a new product

– Build Awareness

– Increase purchases by current customers

– Reward loyalty

• Two General Categories:

– Business to Business (B2B) -> Trade

Promotions

– Business to Consumer (B2C) -> Consumer

Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

The Push-Pull Concept

Customer

Retailer Manufacturer

Push-Pull Policy

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

Trade Promotions (B2B)

• Trade Promotions – Get support for a

product from manufacturers,

wholesalers, and retailers

• More $ promoting to business than

consumers

• Major trade promotions include:

1. Promotional allowances

2. Cooperative advertising

3. Slotting allowance

4. Sales force promotions

5. Trade shows and conventions

Trade Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

1. Promotional Allowances

• Promotional Allowance – Cash

payments or discounts given by

manufacturers to wholesalers and

retailers to encourage sales.

• Therefore, they are more likely to

promote the product to customers

Trade Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

2. Cooperative Advertising

• Manufacturer helps retailer pay cost

of advertising a product

Trade Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

3. Slotting Allowances

• Slotting allowance - Cash premium

paid by the manufacturer to retailer to

place their product on its store shelf

• Several thousand to several million

per product

Supermarket holds how

many products?

Available Products to stock?

Supermarket:

Holds: < 30,000 Products

Available Products:

100,000

Trade Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

5. Trade Shows and Conventions

• Trade Shows and Conventions –

Showcases a particular line of

products

• Uses:

– Introduce new products

– Encourage sales of existing products

– Meet partner in the chain

– Gain continued company and product

support

Trade Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

Consumer Promotions (B2C)

• Sales strategies that designed to

encourage consumers to buy a

product

11 Categories:

•Coupons

•Premiums

•Deals

•Incentives

•Product Samples

•Sponsorships

•Promotional Tie-ins

•Product Placements

•Loyalty Marketing

Program

•Online Loyalty Mktg

Program

•Point-of-Purchase

Display Consumer Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

1. Coupons

Certificates which entitle customers

to cash discounts on goods or

services

Placed on or in packages,

newspapers/ magazines, mailers

Stores are reimbursed by

manufacturer for coupon

Consumer Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

2. Premiums

• Low-cost items given to consumers at a

discount or for free

– Increase sales, builds product loyalty

and attracting new customers (persuade

nonusers to switch brands)

– Motivates people to buy a product when

they are offered an “added value” gift in

exchange

Consumer Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

2. Examples of Premiums

Consumer Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

2. Types of Popular Premiums

Factory packs, or In-packs – Free gifts

placed in or on product packages or as a

container premium

Traffic builders – Low-cost premiums, such

as pens, key chains, and calendars, which

are given away for free to consumers

visiting a new store or attending a special

event

Coupon plans – Ongoing programs

offering a variety of premiums in exchange

for labels, coupons, or other tokens from

one or more purchases Consumer Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

3. Deals

Offer short-term price reductions

that are marked directly on label of

package

• Coupling two products for the price

of one

Consumer Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

4. Incentives

Higher-priced products earned and

given through contests, sweepstakes,

and rebates

Contest – Skill needed to win

Sweepstakes – game of chance

Consumer Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

5.Product Samples

• Product Sample – A free trial-size of a

product

• How Distributed?

• Especially important when promoting

a new product

– Examples: Medicine and textbooks

Consumer Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

6. Sponsorship*

Sponsorship – Promotion of a company in

association with a property

Title Sponsor – Pays to have its name

incorporated into the name of the property

Consumer Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

8. Product Placement

• Displaying or using products in TV shows

and movies

Consumer Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

9. Loyalty Marketing Programs

• Also called Frequent

Buying Program

• Rewards customers

for multiple purchases

Consumer Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

10. Online Loyalty Mktg Program

• Certain web sites provide points for

visiting certain sites or making online

purchases.

• E-bates

Consumer Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

10. Online Loyalty Mktg Program

• Top 10 retail websites :

1. Amazon.com

2.

Consumer Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

11. Point of Purchase Displays

• Displays of products usually placed in

high traffic areas.

Consumer Promotions

The Promotion Mix

Push-Pull Policy

Trade Promotions

Consumer Promotions

Public Relations &

Publicity

Review Sheet Answers

1. B2B – Slotting Allowance

2. B2B – Promotional Allowance

3. B2C – Coupon

4. B2C – Deal

5. B2B – Cooperative Ad

6. B2C – Traffic Builder

7. B2C – Contest

8. B2C – Sponsorship

9. B2C – Promotional Tie-in

10. B2B – Trade Show

11. B2C – Product Placement

12. B2B – Sales Force Promotion

13. B2C – Sweepstakes

14. B2C – Point-of-purchase Display

15. B2C – Loyalty Mktg Program

16. B2C – Product Samples

17. B2C – Rebate

18. B2C – Online Loyalty Mktg

Program

Consumer Promotions

Trade Promotions