You are on page 1of 25

Promotional Mix

Strategies
Push versus Pull
and More
To gain trial among nonusers of a brand/service.
To increase repeat purchase and/or multiple
purchases.
To expand brand usage by suggesting new
uses.
To defend share against competition.
To support advertising campaign, theme, image.
To increase distribution and/or dealer, retailer
cooperation.
Short-term vs. long-term goals and relationships.
Sales Promotion:
Sales Promotion:
Creating an immediate sale is
the primary objective.

Extra incentives to enhance movement
and sales. Helps the selling process.

Direct inducement that offers an extra
value or incentive to sales force,
distributors or the ultimate consumer.

Stimulates Dealer and Channel Involvement.

Sales Promotion:
Increasingly, the gimmicks are
going away. More scanning data.

Step up to the challenge of real, brand building
value, the kind that sparks genuine consumer
and retailer interest.

Contribute to marketing goals.
More Events and Product Licensing


Influences
Push Strategy
calls for using the
sales force and trade
promotion.


Pull Strategy
calls for spending on
advertising and sales
promotion to build
consumer demand.
Push Strategy:
Persuade wholesalers and retailers to carry
brands.
Give a brand shelf space.
Promote a brand in coop advertising.
Producer Wholesaler Retailer Customer
Push Strategy:
Be careful of those big displays at the end of the
aisles.
End Aisle Displays. End Caps.
Look at the prices. Only about 40% is
actually on sale.
Because they are so bright, big and visual, we
feel its on sale.
Producer Wholesaler Retailer Customer
Pull Strategy:
Entice customers to try a new product.
Lure customers from competitive products.
Hold and reward loyal customers.

Producer Wholesaler Retailer Customer
Push Tools:
Deals- Allowances, Price-offs and Discounts
Displays and Point of Purchase
Dealer Premiums
Samples and Free Goods
Buy-Back Guarantees
Cooperative Advertising
Advertising Materials
Push Money (Spiffs)
Dealer Meetings and Contests
Specialty Advertising Items

Pull Tools:
Sampling---in-store, events, newspaper, in-pack
Cents Off Promotions and Coupons (-2%)
Continuity/Frequency and Loyalty Programs
Premiums
SLO (Self-Liquidating Offers/Premiums)
Point of Purchase Displays
Contests, Games and Sweepstakes
Rebates and Cash refunds
FSIs (Free-Standing Inserts) 80% of distribution
Advertising Specialty Items

Hints and Comments:
Coupons getting clipped. Growing retailer
power and new accounting rules make
couponing less attractive.

2002 Package-Goods Marketing Budgets
24%: Advertising
15%: Coupons and Customer Promotion
+61%: Retail-Trade Promotion
100%

1997: 23% Advertising (same)
24% Coupons/Cust. Promotion
53% Retail-Trade Promotion
Hints and Comments:
850 FSIs (free standing inserts)
per person in 04.
251 BILLION coupons. FSIs
are the vehicle in distributing the
majority of coupons. Total pages
increased 5.9 percent in 05.
Average coupon face values grew
6.7%, to $1.09.
Offer duration increased to 10.6
weeks.
Now more Household, and
Heath & Beauty aids
Hints and Comments:
The average face value of Free
Standing Inserts (FSIs) hit $1.03,
in comparison to $.95 in 2003,
representing an 8.1% increase. In
2004 face value reached $1.00 mark
for the first time.
We are seeing more manufacturers
present greater incentives to
shoppers, whether on a face value or
per-unit basis.
Marketers continue to validate that
FSIs are a great tool to build
awareness and gain trial.
Marx Promotion Intelligence 04 FSI Trends
Hints and Comments:
Coupons can be delivered with a
full page of advertising. i.e.,
Restaurants
Coupons on new items but also
on products that have
plateaued. To keep prices low
and keep products on shelf.
$30 savings for a diabetic
testing kit or 25 cents off flour.
Demographics: 43% men; 32%
live with income of $40-75K.

Hints and Comments:
Coupon experts inspire more
use.
Coupon savvy shoppers are advising
other consumers to learn sale
cycles and buy items on sale to
save the most money. Although
coupon fraud exists, manufacturers
offer coupons to entice trying a
new product or switch brands.
Big increases: Vitamins, Rug and
Room Deodorizers; Prepared and
Frozen Foods; Hair Care; Cereals.
Decreases in Household cleaning
products.
Hints and Comments:
Walgreens and 15 top package-
goods marketers are rolling out a
RFID system to electronically track
when, how long, and where
promotional displays are placed in
the chains 5,000+ stores. 1/06
Hints and Comments:
Slotting Allowances: The fees
retailers collect from
manufacturers to ensure shelf
space for new products make the
marketplace more efficient, a
Yale/Cornell study found.
"We find that when retailers
perceive that a product is likely to
be a sure hit, they don't seem to
ask for slotting allowances ...
manufacturers don't offer slotting
allowances when they perceive the
product to be a sure dud.
Progressive Grocer (4/05)
Questions:
Are distributing drug samples
to doctors a push or a pull
strategy?
Incentives from HBO to hotels
and motels. Push or Pull?
Beer.com produced 50K bottle
caps featuring its name and left
them on bars during spring and
winter breaks. Push or Pull?
Question:
Wal-Mart TV network (in store)
42 plasma screens
A smart buy or a goodwill,
defensive gesture?
Sets are silent.
In-store advertising system.
In fall 06, $247K, 129 million
impressions and CPM: $2.28
includes three :30s, and five
:10s, every two hours.
AdvAge 9/06
Sales promotion budgets are usually
divided into three categories:
1. Consumer advertising
2. Consumer promotion
3. Trade promotion

Companies in same industry can put
emphasis on Push or Pull.
Summary:
Push strategy is appropriate with
low brand awareness in a category
and brand choice is made in store.
Can be an impulse purchase and
product benefits are understood.
Pull strategy works best with high
brand awareness and loyalty, or high
involvement in category and
customers look for product
differences.
Summary:
Promotional Mix
Strategies
Push versus Pull
and More
Hints and Comments:
Wal-Mart Touts In-Store TV

Research claims advertising on its
in-store marketing network, with
Premier Retail Networks, is more
efficient than Cable and Network TV
advertising in generating sales. A
survey of TV watchers conducted by
the TNS Media & Entertainment
Group found that 15% of viewers
purchased advertised products
immediately after seeing them on
an in-store broadcast.
MediaPost Communications 11/30/05