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Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1
MKTG
Designed byAmy McGuire, B-books, Ltd.
Prepared byDeborah Baker, Texas Christian University
Lamb, Hair, McDaniel 2007-2008
Sales Promotion and Personal Selling
16
CHAPTER
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 2
Learning Outcomes
Define and state the objectives of sales promotion
Discuss the most common forms of consumer sales promotion
List the most common forms of trade sales promotion
Describe personal selling
LO1
LO2
LO3
LO4
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 3
Learning Outcomes
Discuss the key differences between relationship selling and traditional selling
List the steps in the selling processLO6
LO5
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 4
Define and state the objectives of sales promotion
Sales PromotionSales PromotionLO1
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 5
LO1
Sales Promotion
Marketing
communication
activities, other than
advertising, personal
selling, and public
relations, in which a
short-term incentive
motivates a purchase.
SalesPromotion
SalesPromotion
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 6
LO1
Sales Promotion
Advertising Reason to buy
Sales Promotion Incentive to buy
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 7
LO1
Sales Promotion
ConsumerSales
Promotion
ConsumerSales
Promotion
Trade Sales
Promotion
Trade Sales
Promotion
Consumer market
Marketing channel
Drive immediate purchaseInfluence behavior
Goal
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 8
LO1
Objectives of Sales Promotion
Type of BuyerType of Buyer
Loyal Customers
Competitor’sCustomers
Brand Switchers
Price Buyers
Desired ResultsDesired Results
•Reinforce behavior• Increase consumption•Change purchase timing
•Break loyalty•Persuade to switch
•Persuade to buy your brand more often
•Appeal with low prices•Supply added value
Sales PromotionSales PromotionExamples Examples
•Loyalty marketing•Bonus packs
•Sampling•Sweepstakes, contests, premiums
•Price-lowering promotion•Trade deals
•Coupons, price-offpackages, refunds•Trade deals
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 9
REVIEW LEARNING OUTCOMELO1
The Objectives of Sales Promotion
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 10
Discuss the most common forms of consumer sales
promotion
Tools for Consumer Tools for Consumer Sales PromotionSales Promotion
LO2
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 11
Tools for Consumer Sales Promotion
LO2
Coupons and RebatesCoupons and Rebates
PremiumsPremiums
Loyalty Marketing ProgramsLoyalty Marketing Programs
Contests & SweepstakesContests & Sweepstakes
SamplingSampling
Point-of-Purchase PromotionPoint-of-Purchase Promotion
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 12
Tools for Consumer Sales Promotion
LO2
CouponCoupon
RebateRebate
PremiumPremium
A certificate that entitles consumers to an immediate
price reduction.
A certificate that entitles consumers to an immediate
price reduction.
A cash refund given for the purchase of a product during
a specific period.
A cash refund given for the purchase of a product during
a specific period.
An extra item offered to the consumer, usually in exchange
for some proof of purchase.
An extra item offered to the consumer, usually in exchange
for some proof of purchase.
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 13
14-13
PremiumsPremiums provide consumers with a reason to choose one brand over another.
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 14
Tools for Consumer Sales Promotion
LO2
LoyaltyMarketingProgram
LoyaltyMarketingProgram
A promotional program designed to build long-term, mutually beneficial relationships between a company and key customers.
A promotional program designed to build long-term, mutually beneficial relationships between a company and key customers.
FrequentBuyer
Program
FrequentBuyer
Program
A loyalty program in which loyal consumers are rewarded for making multiple purchases.
A loyalty program in which loyal consumers are rewarded for making multiple purchases.
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 15
Tools for Consumer Sales Promotion
LO2
ContestsContests Promotions that require skill or ability to compete for prizes.
Promotions that require skill or ability to compete for prizes.
SweepstakesSweepstakes Promotions that depend on chance or luck, with free participation.
Promotions that depend on chance or luck, with free participation.
Online
http://www.sweepstakesonline.com
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 16
14-16
Contests like this one encourage consumers to purchase more
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 17
Sweepstakes rely on chance
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 18
Tools for Consumer Sales Promotion
LO2
SamplingSamplingA promotional program that allows the consumer the opportunity to try a product or service for free.
A promotional program that allows the consumer the opportunity to try a product or service for free.
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 19
14-19
Samples
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 20
Methods of Sampling
LO2
Direct mailDirect mail
Door-to-door deliveryDoor-to-door delivery
Packaging with another productPackaging with another product
Retail store demonstrationRetail store demonstration
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 21
Point-of-Purchase Promotion
LO2
Build traffic
Advertise the product
Induce impulse buying
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 22
Point of Purchase
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 23
Online Sales Promotion
LO2
Effective Types of Online Sales PromotionEffective Types of Online Sales Promotion
Free merchandise
Sweepstakes
Free shipping with purchases
Coupons
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 24
REVIEW LEARNING OUTCOMELO2
Consumer Sales Promotion
Coupons and rebates
Premiums
Loyalty marketing programs
Contests
Sampling
P-O-P
Online
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 25
List the most common forms of trade sales
promotion
Tools for Trade Sales PromotionTools for Trade Sales PromotionLO3
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 26
Trade Sales PromotionLO3
Trade AllowancesTrade Allowances
Push MoneyPush Money
TrainingTraining
Free MerchandiseFree Merchandise
Store DemonstrationStore Demonstration
Conventions & Trade ShowsConventions & Trade Shows
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 27
Trade AllowanceLO3
TradeAllowance
TradeAllowance
A price reduction offered
by manufacturers to
intermediaries, such as
wholesalers and retailers.
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 28
Push MoneyLO3
Push MoneyPush MoneyMoney offered to channel
intermediaries to encourage
them to “push” products--
that is, to encourage other
members of the channel to
sell the products.
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 29
Benefits of Trade PromotionsLO3
Help manufacturers gain new distribution
Obtain wholesaler and retailer support forconsumer sales promotions
Build or reduce dealer inventories
Improve trade relations
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 30
REVIEW LEARNING OUTCOMELO3
Forms of Trade Sales Promotion
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 31
Describe personal selling
Personal SellingPersonal SellingLO4
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 32
LO4
Personal Selling
Personal Selling is more important if...
Customers are concentrated.
Customers are concentrated.
Product is technically complex.
Product is technically complex.
There are few customers.There are few customers.
Product is custom made.Product is custom made.
Product has a high value.Product has a high value.
Customers are geographically dispersed.
Customers are geographically dispersed.
Product is simple to understand.
Product is simple to understand.
There are many customers.There are many customers.
Product is standardized.Product is standardized.
Product has a low value.Product has a low value.
Advertising & Sales Promotion are more important if...
Chapter 16 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 33
REVIEW LEARNING OUTCOMELO4
Personal Selling
Detailed explanation or demonstration
Variable sales message
Directed to qualified prospects
Controllable adjustable selling costs
More effective than other promotion in obtaining sale and gaining customer satisfaction
PersonalSelling
Advantages
PersonalSelling
Advantages