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Promotions have four elements called the Promotions Mix: 1. 2. 3. 4. Advertising- to effectively inform and persuade target market. Public Relations- to offer a positive image of the company and the brand. Selling- to get the customers to buy. Sales Promotions- to convince customers to buy immediately. Characteristics of Sales Promotion 1. Temporary Sales promotions are conducted on short durations. 2. Better Value As similar products are looked at in a similar sense, sales promotions are used to create short-term product differentiation via offering a better product value. 3. Beneficial Sales promotions promote growth, sometimes however, even at an artificial level. This growth benefit can be attained for different objectives such as generate or increase product trial, or increase purchase quantity.
Sales promotions are often referred to as the product PUSH because they resort to a direct shorter term objective to gain customers, whereas advertising is often referred to as the product PULL because it takes an indirect longer-term approach to gain customers.
TRADE PROMOTIONS Trade promotions are designed to convince trade channels like retailers and wholesalers to buy immediately, or to buy more than their usual quantity. Examples of Trade Promotions 1. Cooperative Advertising As the term implies, cooperative advertising happens when supplier and his trade customers share in paying for an advertising campaign, usually featuring the product of the supplier exclusively or among other products.
Free Products Free products promotions involve giving of additional quantity of products on top of regular purchase volume. on the other hand. Giving free products such as one bag of every ten bags purchase is better than giving cash or its equivalent such as a 10% discount. 8. or an introductory discount for a new product launched. 4. or volume discounts designed to build inventories with the trade. provided prestige to their outstanding dealers by honoring and featuring them in whole-page newspaper announcements. 7. when based on sales. Push Pin Money A variety of rewards promotions is Push Pin Money which is money given to the salesclerks of the dealers (and frequently including the dealers themselves) to push the firm’s products. Rebates/Rewards Marketers may offer year-end rebates as a token of appreciation for the loyalty of their dealers. It may come in the form of prompt payment discount for the payments made on time. Trade Contest Goldstar appliances once launched their best window display contest in 1991 after sponsoring a seminar on window display to the artists of their appliance retailers. Companies with new products may also launch a “Best New Product Presentation” campaign among stores. 5. This enables bigger retailers to sell some of their products at cost and aim for the rebate expected at the end of the year for pre-agreed volume purchases. . 6. 3. Sony and Sharp. Discounts and Terms Discounts are straight deductions from the list price. This is because of the variable cost involved unlike the fixed cost of nature of cooperative advertising. and most specially when based on incremental. Display Allowance Display allowances are financial support granted to the trade outlet for the performance of instore display requirements.2. are better than cooperative advertising. among many other possible discounts. sales. Cooperative Promotions Cooperative promotions.
Sampling Sampling is a limited amount of the free products offered to consumer.9. Exhibits Joining exhibits and tradeshows is a cost-effective way to create awareness. she is entitled to an incentive. Coupons Coupons are certificates entitling the bearer to a published saving on the purchase of a specific product. or in places where target markets are located. Conferences/Training Conferences and training are promotions which advance goodwill with the trade. Price-Off Price-offs are promotions that offer immediate savings upon purchase. 10. 4. 1. Since the come-on is savings. 2. Rebates . If the saleslady of the trade store will recommend the specific brand of your company. most specially for business-to-business products and high priced consumer durables. CONSUMER PROMOTIONS Consumer promotions are designed to convince end-users to buy immediately or to buy more than their usual quantity. thru another product. 11. via door-to-door. It is usually given in the store. Personality Mystery buyer is an example. by mail. Usually. the trade outlet will also get some incentive to reinforce the effectiveness of the personality contest. the amount consumers can save must be significant (say at least 5 to 12%) to be attractive. 3. and generate sales leads. “Anniversary Sale “where products are offered at a lower price within a limited duration is an example of price-off promotions.
Coherence is the key. 7. By far. Detergents and juice drinks with bonus packs.i. It may sometimes involve special trial size packaging like a smaller bottle of perfume or a sample of toothpaste.. free 20 grams more. Marketers for instance can find a combined Happe Toothbrush and Happe Toothpasdte special pack effective but not when Happe Toothpaste and shoe brushes are combined for obvious reason. 8. 5. Self – Liquidating Promotions .Rebates are like coupons except that the price reduction is usually larger and are given after the purchase rather than at the point of sale. Premiums Premiums are free gifts offered as incentive to purchase a particular product. this remains the most popular sales promotional scheme in the Philippines as it provides immediate value to the consumers without dropping price.e. Bonus Packs Bonus packs involve giving extra quantity of the same product without increase in price. 9. 6. in the super market are common examples. Sample Packs Sample packs involve trial size of a product at a price usually lower than market standard. Special Packs Products combined as single packs can bring savings for consumer.
12. and sometimes even experience profit. consumer at the chance to win up to one million pesos if the three-digit number in the Pepsi crown will be announced as the winning number. the marketers can recover all his expenses for the promotion. Warranty Warranty reduces the risk factor in a purchase. 13. most especially for high involvement or high-priced products and service.Jollibee and McDonald’s are probably the most popular marketers of self-liquidating promotion which sell merchandise like toys to consumers 20% to 30% below its normal retail price. Prizes Consume may be offered an opportunity to win a prize after purchasing product. Automatic center is famous for their money refund warranty in case customers can show that the same product they brought is being advertised at a lower price within a specified duration. The free trial concept will be most effective when there is a high risk perception associated with the product such as a newly launched innovation 11. Free Trial This type of promotions invites prospective customers to try the product without cost in the hopes that they will buy the product. 10. Patronage Reward . Patterned after after “Jeuteng”. As the term self-liquidating implies.
a sales promotion needs a written plan. have their frequent flyer program when mileage earned can be exchanged for free Trips 14. for instance. .) Title This is name given to the sales promotion 2. SALES PROMOTION PLAN Like any project. This is to ensure that all elements of the sales promotion are defined and agreed upon.) Objective Objectives answer the question “why are you having a sales promotion? “This means that no sales no sales promotion should be implemented if no improvement will be experienced objective also answer the question “what problems do you want to solve? Objectives are defined to determine the intensity of strategies and tactics. They must be concrete and clear to the marketer. Contest Contest are promotions given to consumers to have a chance of winning something of value. Airline. 1. 15. Personality “Mystery Visitor” is a common is a common form of personality promotion this entails the consumer to show the product of the company of the mystery visitor to win a prize.Consumer may be given an incentive in promotion to the volume of product regularly purchased. Consumers may be able to join a contest by submitting entries either with or without proof of purchase of a product.
The time period involve in a sales promotion is very important. 3. 5. Duration Duration identifies the length of the promotion. A balance must be made between reasonable and attractive. many prospects may not be able to join. Coverage Coverage defines the specific territories included in the sales promotion. If it’s is two short. there is a possibility of exceptional increase in the sales volume of a territory (Say San Pablo) included in the promotion rear another territory (Say Naga) included in the promotion. On the other hand.SMART OBJECTIVES Specific – not vague Measurable – than can be quantified Attainable – and not overly ambitious Realistic – and must consider constraints Trackable – with checkpoints capable of being monitored to ensure improvement. Offer An offer identifies the type and size of promotion to be executed. the urgency characterizing a sales promotion objective may be lost. The size of the offer must be reasonable and attractive for their customers to join. When not all of the territories are included in a sales promotion. if it is too long. . 4.
Dual promotions 5. Budget The cost to promote section is critical. A short promotion period 3. The communication should motivate the target consumer to say “I want it!” 8. Strong trade support 2. and after the promotions duration is as important as the sales promotions itself. the conditions for participation. during. The two most common ways of establishing sales promotion budget are: 1. Communications How to communicate the sales promotions at the start. and 2.6. who is responsible for what and a contingency in case unexpected things would happen. The support of salesforce and the trade 9. 7. the detail logistics needed.) Objective – taste method. Marketers must answer questions like “will share and profit increase? Cost effectiveness must include an analysis of loyal customers who will get a free subsidy during the promotion. A high level of incentives 4.) Percentage of sales method . Mechanics This section identifies approaches to the achievement of objectives it includes how the promotions will be implemented. Key factors for success 1.
the advertising objective or objectives must be set. Promotional advertising. Advertising Objectives: Before any advertising program can be set. and finally quantifying the budget needed to perform this task. which aims to inform prospects about promotional activities such as special sale. These advertising objectives must be relevant to the existing market situation. It could be: 1. New product Product function Correct usage New uses New distribution . which aims to stimulate demand for particular brand. 3. Advertising serves several purposes. 2. a definition of the promotions specific objectives followed by a list of tasks to be done to achieve these objectives. events. 4. 5. 2. Classified advertising. ADVERTISING STRATEGY Advertising is a PULL strategy in contrast to sales promotions which is a PUSH strategy. which aims to develop goodwill for a company or industry. This encourages the marketer to think in terms of the relationships between promotion cost. which aims to inform prospects regarding opportunities such as buy and sell. Advertising Objectives TO INFORM target customers about: 1. Brand advertising. and employment. 5. which aims to convince audience regarding a particular cause. 3. Institutional advertising. 4.The objective task method involves first and foremost. on the other hand pegs a specific percent of sales promotional budget to anticipated sales. and profit per unit. Percentage of sales method. Advocacy advertising.
HOW MUCH to spend which we will discuss in the advertising budget section. 3. Positioning Positioning is the act of communicating to consumers the overall positive impression for brand. 1. the more difficult the repositioning is likely to be. WHAT to say (message) HOW to say (copy execution) WHERE to say (media selection) WHEN to say ( media scheduling) Other critical questions are: 5. 2. As a general rule. *Repositioning has two concepts. relative to the competition. HOW to measure effectiveness of results which we will discuss under the advertising testing section. Brand preference Brand switching Urgency to buy now Action to be taken ( phone-in inquiry) Advertising Mix Advertising decisions to be decided before an advertising program can be implemented. Repositioning Repositioning is done to change the past perceptions of the target consumer. the more extreme the change. 3. These decisions are usually made after the target market and the advertising objectives have already been defined. 2. 4. and 6. Price adjustment TO PERSUADE target customers about: 1. Positioning is like a woman dressing up beautifully to be different from all the rest.6. . 4.
Guide questions are very important before a copy brief can be written. It includes the product features and proof (or “reasons why”) that justify the proposition so as to make the proposition as convincing as possible. Target Market What is the demographic and psychographic profile of the primary and secondary target market we plan to reach? 3. Copy Brief Copy brief or copy strategy is basic proposition. 2. The second one attempts to change consumer perception of competitors. They are: 1. or more usage for our brand? 2. Copy brief also includes the tone of voice in which the message should be delivered (in case of TV or radio advertisements) which includes the brand image to be projected. and script (with or without jingle) in the case of commercial. research and judgement. 3. or statement of benefit. The creative process itself where the output is a storyboard (similar to a comic strip) in the case of a TV advertisement. Preparation of copy strategy and or brief from which the creative team must work. This could be a combination of logic. consumer promise. Factor influencing product purchase . 2.1. Brand Overall Objective Is our objective to create new uses. Evaluation of the creative output. The first one is changing an old brand positioning to a new brand positioning. and frequently the consumer image. COPY STRATEGY The following are the stages in creating advertising: 1. what attributes are important to the customers where we have the advantage? 4. or the picture the brand user has of himself. Diagnostic Positioning In terms of competitive standing.
8. how. Fantasy Fantasy is created around the product or its use. Nissan “ECCS” advertisement is an example of technical expertise. and Mario’s would emphasize not only on the restaurants good food but the cozy ambience as well. 5. For instance. . Musical Background music or the ad talent would be shown singing a song involving the product. attitude. Slice Of Life This shows one or more persons using the product in a normal setting. how often. 6. Technical Expertise This shows the company’s expertise and experience in making the product. 7. cowboys are closely associated with the Marlboro brand. 4. Scientific Evidence Colgate has been using scientific and. laboratory evidences in promoting their product’s relative superior performance against competition. Lifestyle Emphasizing on how a product fits in with a lifestyle. size. 3. luxurious restaurants like Dona Nena. Testimonial Evidence A closely associated evidencing format is the testimonial approach where a credible individual or group would endorse the company’s product. 2. and interest (UAI) survey. variants bought as can be gathered in a usage. 9. Image Bench shirts make use of image without explicitly claiming anything about their product except by suggestion. Advertising Execution Advertising message can be presented in at least 9 execution styles as follows: 1. Personality Symbol This associates a person to a product.This answers the where.
print newspapers. magazines. Impact goes beyond recall and make consumer interested in the brand. and DE households (total 330) as TV rating panel. Reach is composed of two types: a. or read. It is the media cost of gaining exposure to 1. To find the audience. that the target audience is known or expected to see. Gross Rating Point (GRP) and Cost per Thousand (CPM) Gross Rating Point or GRP is the result of combining Reach(R) and Frequency (F). the media plan is said to have a GRP of 600 points (60 x 10) for that particular week. Cost per thousand (CPM) is a term used to compare the cost effectiveness of various media. Thus. Recognition – or people who could not playback anything meaningful. hear.MEDIA PLAN: WHERE and WHEN to advertise Exposure (E) is the placement in a media vehicle such as TV. This is bases on the idea that consumers normally have to be exposed to a band’s advertising a number of times. C. Impact (I) or the qualitative value of an exposure though a given medium size. Reach (R) or the number of consumers exposed to a particular advertising at least once during the specified duration. Exposure creates awareness.000 persons with an advertisement. written a purchase cycle. 2. before an advertising can influence purchase. Registration – or people who correctly recall and playback something meaningful b. Panel member’s record in a specially designed diary with a fifteen minute interval the TV shows they watched. radio. To find the most cost-effective media to deliver the desired awareness. Frequency (F) or the number of times consumers are reached. E = R x F. three important and interrelated exposure variables must be considered: 1. but recognize the advertisement. 3. If a giving media plan reaches 60% or the homes with an average frequency of 10 in a week. The designed diary a fifteen minute interval the TV . PEOPLE METER Most ratings of TV shows are done using 110 of each AB.
shows or implies. The research company representative then gathers these diaries on a daily or weekly basis. BUY TEST measures consumer response to broadcast and occasionally (because of cost). does not automatically make the respondents of this level have an interest or a desire of owning or using the product or service advertised. Milton Sherman of Sherman Group Inc of New York.one interview technique with a minimum of 130 respondents per advertising material to be tested. Persuasion Consumers reaching the Persuasion stage demonstrate a high commitment to the product with a burning desire to act on the advertising message. . to print advertising.shows they watched. Involvement The feelings or Involvement stage seeks to determine the levels of consumer emotional reactions to the advertisements. plus their own interpretation of its visual and copy elements.on. is handled in the Philippines by Frank Small and Associates. BUY TEST BUY SCHALE Recall The first step in the BUY TEST is to determine the extent of understanding of the visual as well as the copy elements of the advertisement. however. Those questions are reflected in the BUY SCALE. Each consumer reacts to only one advertisement. ADVERTISING TESTING There are many ways to test effectiveness of advertising materials. 0ne advertising research model available is called the BUY TEST. The BUY TEST utilizes a one . An understanding of what the advertising says. developed by Dr. The BUY TEST divides consumer response into three distinct categories following three questions marketers always ask about their advertising.
Merasol Alvarez. Cherry Joy . Jessa Corvera.Written Report In MM2 (MARKETING MANAGEMENT) Vargas. Mae Pazo.
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