Retail Advertising and Promotion

Chapter 11
Retail Advertising and Promotion
Chapter 11
Goals for Chapter 11
 Goals for Chapter 11
 Discuss Four Components of Retail
promotion Mix
 Goals for Chapter 11
 Discuss Four Components of Retail
promotion Mix
 Advertising
 Goals for Chapter 11
 Discuss Four Components of Retail
promotion Mix
 Advertising
 Sales promotions
 Goals for Chapter 11
 Discuss Four Components of Retail
promotion Mix
 Advertising
 Sales promotions
 Publicity
 Goals for Chapter 11
 Discuss Four Components of Retail
promotion Mix
 Advertising
 Sales promotions
 Publicity
 Personal Selling
 Goals for Chapter 11
 Discuss Four Components of Retail
promotion Mix
 Advertising
 Sales promotions
 Publicity
 Personal Selling
 Discuss Promotional Objectives
 Goals for Chapter 11
 Discuss Four Components of Retail
promotion Mix
 Advertising
 Sales promotions
 Publicity
 Personal Selling
 Discuss Promotional Objectives
 Review Steps in a Retail
Advertising Campaign
 Goals for Chapter 11
 Discuss Four Components of Retail
promotion Mix
 Advertising
 Sales promotions
 Publicity
 Personal Selling
 Discuss Promotional Objectives
 Review Steps in a Retail Advertising
Campaign
 Discuss Promotion and Publicity
Management
Promotion Mix
Promotion Mix
 The combination of
Promotion Mix
 The combination of
 Advertising
Promotion Mix
 The combination of
 Advertising
 Sales Promotion
Promotion Mix
 The combination of
 Advertising
 Sales Promotion
 Publicity
Promotion Mix
 The combination of
 Advertising
 Sales Promotion
 Publicity
 Personal Selling
Promotion Mix
 The combination of
 Advertising
 Sales Promotion
 Publicity
 Personal Selling
that conveys to the consumers
messages about the retailer, its
products, its service and its goals
Promotion Mix
 The combination of
 Advertising
 Sales Promotion
 Publicity
 Personal Selling
that conveys to the consumers
messages about the retailer, its
products, its service and its goals
 Promotional mix must provide a
consistent message to the consumer
Advertising
 Advertising
Paid non-personal
communication through
various media
 Advertising
Paid non-personal
communication through
various media
Objective to inform reader
listener or viewer about
 Advertising
Paid non-personal
communication through
various media
Objective to inform reader
listener or viewer about
Retailer
 Advertising
Paid non-personal
communication through
various media
Objective to inform reader
listener or viewer about
Retailer
Offerings
 Advertising
Paid non-personal
communication through
various media
Objective to inform reader
listener or viewer about
Retailer
Offerings
Prices
 Advertising
Paid non-personal
communication through
various media
Objective to inform reader
listener or viewer about
Retailer
Offerings
Prices
Services
 Advertising
Paid non-personal
communication through
various media
Objective to inform reader
listener or viewer about
Retailer
Offerings
Prices
Services
etc.
Advertising
AdvertisingExpenditures
Expendituresas
asaaPercentage
Percentage
of
ofSales
Sales

Wal-Mart Corporation 0.34%

Sears, Roebuck & Co. 3.78%
Kmart Corp. 1.25%
Dayton Hudson Corp. 2.15%
J.C. Penney Co. 3.42%
Federated Dept. Stores 3.75%
May Dept. Stores Co. 3.43%
Woolworth Corporation 1.30%

Retailing, 3rd Edition, Dunne and Lusch Copyright © 1999 by Harcourt Brace & Company
All rights reserved.
Sales Promotions
Sales Promotions
Use of media and non-media
activities for a specific period of time
Sales Promotions
Use of media and non-media
activities for a specific period of time
Objective to
Sales Promotions
Use of media and non-media
activities for a specific period of time
Objective to
Stimulate trial
Sales Promotions
Use of media and non-media
activities for a specific period of time
Objective to
Stimulate trial
Increase demand
Sales Promotions
Use of media and non-media
activities for a specific period of time
Objective to
Stimulate trial
Increase demand
improve availability
Sales Promotions
Use of media and non-media
activities for a specific period of time
Objective to
Stimulate trial
Increase demand
improve availability
Includes
Sales Promotions
Use of media and non-media
activities for a specific period of time
Objective to
Stimulate trial
Increase demand
improve availability
Includes
premiums
Sales Promotions
Use of media and non-media
activities for a specific period of time
Objective to
Stimulate trial
Increase demand
improve availability
Includes
premiums
Frequent buyer programs
Sales Promotions
Use of media and non-media activities
for a specific period of time
Objective to
Stimulate trial
Increase demand
improve availability
Includes
premiums
Frequent buyer programs
coupons
Sales Promotions
Use of media and non-media activities for a
specific period of time
Objective to
Stimulate trial
Increase demand
improve availability
Includes
premiums
Frequent buyer programs
coupons
etc.
CONSUMER ELECTRONICS 79%
ASSEMBLED FURNITURE 77%
WOMEN’S CLOTHING 74%
MEN’S CLOTHING 69%
BOY’S & GIRL’S CLOTHING 58%
INFANT’S & TODDLER’S CLOTHING 57%

Retailing, 3rd Edition, Dunne and Lusch Copyright © 1999 by Harcourt Brace & Company
All rights reserved.
Publicity
 Publicity
 Non-paid-for communications
of information about the
company or product generally
in some media form
 Publicity
 Non-paid-for communications
of information about the
company or product generally
in some media form
 Examples
 Publicity
 Non-paid-for communications
of information about the
company or product generally
in some media form
 Examples
 CVS Cleveland Marathon &10K
 Publicity
 Non-paid-for communications
of information about the
company or product generally
in some media form
 Examples
 CVS Cleveland Marathon &10K
 Medic Drug Cleveland Grand Prix
 Publicity
 Non-paid-for communications
of information about the
company or product generally
in some media form
 Examples
 CVS Cleveland Marathon &10K
 Medic Drug Cleveland Grand Prix
 Contrary to the old saw there is
such a thing as bad publicity
Personal Selling
Personal Selling
Selling that involves a
face-to-face (or phone-
to-phone) interaction
Personal Selling
Selling that involves a
face-to-face (or phone-
to-phone) interaction
Personal Selling
Selling that involves a
face-to-face (or phone-
to-phone) interaction
Occurs after other
promotional activities
bring the consumer to
the retailer
Channel Promotion
 Channel Promotion
 Common practice of
Sharing of promotion
by manufacturer and
retailer
 Channel Promotion
 Common practice of
Sharing of promotion
by manufacturer and
retailer
 Focus of Manufacturer
is often different from
retailer even though
both have goal of
increasing sales
 Coupons in retailer ads 90%
Cents-off 90%
In-store coupons 88%
Refunds 85%
Electronic, in-store displays 83%
Samples of established products 78%
Premiums 75%
Sweepstakes 70%
Retailing, 3rd Edition, Dunne and Lusch Copyright © 1999 by Harcourt Brace & Company
All rights reserved.
 Percentage of Rebates
Redeemed by
Dollar Value
Value
Redeemed
Greater than $50 84%
$25.00 - 49.99 51%
$15.00 - 24.99 18%
$ 5.00 - 14.99 10%
$ 2.00 - 4.99 6%
Less than $2.00 2%

Retailing, 3rd Edition, Dunne and Lusch Copyright © 1999 by Harcourt Brace & Company
All rights reserved.
Promotional Objectives
 Promotional Objectives
Long Term - Institutional
 Promotional Objectives
Long Term - Institutional

Create a positive
store image
 Promotional Objectives
Long Term - Institutional

Create a positive
store image
Store Positioning in
Marketplace
 Promotional Objectives
Long Term - Institutional

Create a positive
store image
Store Positioning in
Marketplace
Public Service
Promotional Objectives
Short Term - Promotional
Promotional Objectives
Short Term - Promotional

Increase sales to
current customers
Promotional Objectives
Short Term - Promotional

Increase sales to
current customers
Attract new customers
 Promotional Objectives
Long Term - Institutional Short Term - Promotional

Create a positive Increase sales to

store image current customers
Store Positioning in Attract new customers
Marketplace
Public Service
Exhibit 11.1

Possible Promotion Objectives in

Retailing

Improve Long-Run Improve Short-Run

Performance Performance

Store Image Public Increase

Attract
and Positioning Service Patronage of
New
Existing
Customers
Customers

From Existing Expand

Trade Area Trade Area

Retailing, 3rd Edition, Dunne and Lusch Copyright © 1999 by Harcourt Brace & Company
All rights reserved.
Steps in a Retail Advertising
Campaign
 Steps in a Retail Advertising
Campaign
 Select Advertising
Objectives
 Steps in a Retail Advertising
Campaign
 Select Advertising
Objectives
 Budget for the
Campaign
 Steps in a Retail Advertising
Campaign
 Select Advertising
Objectives
 Budget for the
Campaign
 Design the Campaign
 Steps in a Retail Advertising
Campaign
 Select Advertising
Objectives
 Budget for the
Campaign
 Design the Campaign
 Select the media to use
 Steps in a Retail Advertising
Campaign
 Select Advertising
Objectives
 Budget for the
Campaign
 Design the Campaign
 Select the media to use
 Schedule the ads
 Steps in a Retail Advertising
Campaign
 Select Advertising
Objectives
 Budget for the
Campaign
 Design the Campaign
 Select the media to use
 Schedule the ads
 Evaluate the results
Advertising Objectives
 Advertising Objectives
• Must be based on:
 Advertising Objectives
• Must be based on:
 Age of Store
 Advertising Objectives
• Must be based on:
 Age of Store
 Store location
 Advertising Objectives
• Must be based on:
 Age of Store
 Store location
 Types of Goods
 Advertising Objectives
• Must be based on:
 Age of Store
 Store location
 Types of Goods
 Level of competition
 Advertising Objectives
• Must be based on:
 Age of Store
 Store location
 Types of Goods
 Level of competition
 Market Area Size
 Advertising Objectives
• Must be based on:
 Age of Store
 Store location
 Types of Goods
 Level of competition
 Market Area Size
 Supplier Support
 Advertising Objectives
• Must be based on:
 Age of Store
 Store location
 Types of Goods
 Level of competition
 Market Area Size
 Supplier Support
 Examples of objectives
provided on page 391
Budgeting the Campaign
Budgeting the Campaign
 Main question is if it will be
a retailer only campaign or a
Co-op campaign
Budgeting the Campaign
 Main question is if it will be
a retailer only campaign or a
Co-op campaign
 If Retailer campaign
methods of budgeting
include
Budgeting the Campaign
 Main question is if it will be
a retailer only campaign or a
Co-op campaign
 If Retailer campaign
methods of budgeting
include
 Affordable method
Budgeting the Campaign
 Main question is if it will be
a retailer only campaign or a
Co-op campaign
 If Retailer campaign
methods of budgeting
include
 Affordable method
 Percentage-of sales method
Budgeting the Campaign
 Main question is if it will be
a retailer only campaign or a
Co-op campaign
 If Retailer campaign
methods of budgeting
include
 Affordable method
 Percentage-of sales method
 Task and objective method
Designing the Message
 Designing the Message
 Goals
 Designing the Message
 Goals
 Attract and retain attention
 Designing the Message
 Goals
 Attract and retain attention
 Meet advertising strategy
 Designing the Message
 Goals
 Attract and retain attention
 Meet advertising strategy
 Avoid errors (“guaranteed or
free”
 Designing the Message
 Goals
 Attract and retain attention
 Meet advertising strategy
 Avoid errors (“guaranteed or
free”
 Approaches
 Designing the Message
 Goals
 Attract and retain attention
 Meet advertising strategy
 Avoid errors (“guaranteed or
free”
 Approaches
 Lifestyle
 Designing the Message
 Goals
 Attract and retain attention
 Meet advertising strategy
 Avoid errors (“guaranteed or
free”
 Approaches
 Lifestyle
 Designing the Message
 Goals
 Attract and retain attention
 Meet advertising strategy
 Avoid errors (“guaranteed or
free”
 Approaches
 Lifestyle
 Fantasy
 Designing the Message
 Goals
 Attract and retain attention
 Meet advertising strategy
 Avoid errors (“guaranteed or
free”
 Approaches
 Lifestyle
 Fantasy
 Humor
 Designing the Message
 Goals
 Attract and retain attention
 Meet advertising strategy
 Avoid errors (“guaranteed or
free”
 Approaches
 Lifestyle
 Fantasy
 Humor
 Slice of Life
 Designing the Message
 Goals
 Attract and retain attention
 Meet advertising strategy
 Avoid errors (“guaranteed or free”
 Approaches
 Lifestyle
 Fantasy
 Humor
 Slice of Life
 Mood / image
Media Alternatives
Media Alternatives
 Newspaper
Media Alternatives
 Newspaper
 Television
Media Alternatives
 Newspaper
 Television
Media Alternatives
 Newspaper
 Television
 Radio
Media Alternatives
 Newspaper
 Television
 Radio
Media Alternatives
 Newspaper
 Television
 Radio
 Magazine
Media Alternatives
 Newspaper
 Television
 Radio
 Magazine
 Direct mail
Media Alternatives
 Newspaper
 Television
 Radio
 Magazine
 Direct mail
 Internet
Media Alternatives
 Newspaper
 Television
 Radio
 Magazine
 Direct mail
 Internet
 Other
Media Selection
Media Selection
 Coverage
Media Selection
 Coverage
 Reach
Media Selection
 Coverage
 Reach
 Frequency
Media Selection
 Coverage
 Reach
 Frequency
 Cost per thousand
(CPM)
Advertising Scheduling
Advertising Scheduling
 On or just before big
buying days
Advertising Scheduling
 On or just before big
buying days
Advertising Scheduling
 On or just before big
buying days
 Concentrated on pay
dates
Advertising Scheduling
 On or just before big
buying days
 Concentrated on pay
dates
 Periods of highest
demand
Advertising Scheduling
 On or just before big
buying days
 Concentrated on pay
dates
 Periods of highest
demand
 Period of highest
CPM
Advertising Scheduling
 On or just before big
buying days
 Concentrated on pay
dates
 Periods of highest
demand
 Period of highest CPM
 Habit (same day each
week)
Monitoring Advertising
 Monitoring Advertising
• Effectiveness - did
advertising produce
the results desired
(added sales, added
customers, disposal of
specific product, etc)
 Monitoring Advertising
• Effectiveness - did
advertising produce the
results desired (added
sales, added customers,
disposal of specific
product, etc)
• Efficiency - Was the
result achieved with the
minimum financial
expenditure
Sales Promotions -
Retailer Sponsored
Sales Promotions -
Retailer Sponsored
 Premiums - (e.g., Fast
food restaurants)
Sales Promotions -
Retailer Sponsored
 Premiums - (e.g., Fast
food restaurants)
 Contests and
Sweepstakes
Sales Promotions -
Retailer Sponsored
 Premiums - (e.g., Fast
food restaurants)
 Contests and
Sweepstakes
Sales Promotions -
Retailer Sponsored
 Premiums - (e.g., Fast
food restaurants)
 Contests and
Sweepstakes
 Frequent Buyer
programs - (e.g.,
Waldenbooks and
Subway)
Sales Promotions -
Joint Sponsored
Sales Promotions -
Joint Sponsored
 Coupons - (only 2%
redeemed but worth $180
million)
Sales Promotions -
Joint Sponsored
 Coupons - (only 2%
redeemed but worth $180
million)
Sales Promotions -
Joint Sponsored
 Coupons - (only 2%
redeemed but worth $180
million)
 In-store displays -
Payments made to
retailer by manufacturer
Sales Promotions -
Joint Sponsored
 Coupons - (only 2%
redeemed but worth $180
million)
 In-store displays -
Payments made to
retailer by manufacturer
 Demonstrations and
Sampling
Summary
 Summary
• The correct promotion
mix of advertising, sales
promotion, publicity and
direct selling is important
to retail success
 Summary
• The correct promotion
mix of advertising, sales
promotion, publicity and
direct selling is important
to retail success
• However, such promotion
is expensive and must be
well planned and
monitored to ensure
maximum benefit