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MKTM511
Consumer Oriented and Trade Oriented
Sales Promotion in IMC
What it’s all about?

Dr. Pawan Kumar

Lecture Outcome

Evaluate the Consumer Oriented and Trade Oriented Sales Promotion in IMC

Dr. Pawan Kumar

Serta, the manufacturer of mattresses, gave away a Serta
Sheep Plushie toy to any customer who purchased a
mattress from a Serta dealer. The toy was only available
for a limited time. The stuffed toy is an example of a:
A. coupon
B. sample
C. free premium
D. rebate
Heinz Foods created a Cinco de Maio celebration for a large supermarket
that targets Mexican-Americans, a market that Heinz sees as an area of
potential growth. Heinz paid for a mariachi band to serenade shoppers
during the day and also set up a food-sampling booth at the store's entry.
This would be an example of:
A. incentive marketing.
B. a franchise building promotion.
C. brand equity building.
D. account-specific marketing.
E. horizontal cooperative integration
CASE LET: Pringles Chips WTF

Pringles is a snack brand owned by Kellogg’s, and is sold in over

140 countries. Most students would know this brand as it comes
in a can and the chips are stacked.

Dr. Pawan Kumar

• A good ad needs to capture involuntary attention of consumers
due to its relevance to the target segment ..

Source
https://brandequity.economictimes.indiatimes.com/news/marketing/synergizing-digital-channels/95438422
• Digital Transmedia
• https://youtu.be/36SDHEwSA_U
HERE ARE SOME OF THE FLAVOURS
In 2020 in Australia, Pringles ran a sales promotion built around
WTF = what’s the flavor? Here is their packaging for this
promotion…
As can be seen, the packaging is black-and-white, giving no particular clue to the flavor inside. Mr.
Pringle on the logo looks puzzled. And the caption at the top of the packaging reads “what’s the
flavor? Guess to win $10,000. Therefore, it has been designed as a competition-based sales
promotion.

DISCUSSION QUESTIONS
•Do you think that this campaign be likely to increase short-term sales?
•Why would a consumer buy a product where they did not know whether they liked the flavor?
•Why would the brand associate with the letters WTF, given this can also have a negative
connotation?
•Why would the brand run this sales promotion, rather than just introducing the new flavor straight
to the marketplace?
•Could this campaign help increase brand engagement overall?
•Other than short-term sales, what other marketing goals could this campaign have for the brand?
Objectives of Consumer-Oriented Promotions

Increase consumption
of an established brand

Obtain trial Defend (maintain)

and purchase current customers

Enhance IMC efforts Target a

and build brand equity specific segment
 Test your Knowledge
When Campbell Soup Company introduced its V8 Splash fruit
medley juices, the company gave out free samples at Sam's Clubs
and distributed millions of 50-cents-off coupons. The objective(s) of
these sales promotion tools was to:
A. defend the brand's customer base.
B. obtain trial and repurchase.
C. target a specific market.
D. increase consumption of an established brand.
E. create long-term brand equity.
 Consumer Franchise-Building Promotions
Promotional Objectives

Communicate Develop and Build long-term

distinctive reinforce brand brand
brand attributes identity preference

Techniques and Practices

“Frequency” Sweepstakes & Premium offers

programs contests build that reinforce
promote repeat equity, increase brand image &
purchase involvement build equity
Which of the following is an example of consumer franchise
building promotion?

A. Frequent flyer program of Lufthansa airways that gives the customer points on
each travel that can be redeemed against various other purchases.
B. ‘Buy one get one free' offer by Heinz ketchup.
C. ‘Flat 30%' off on all merchandise at Nike exclusive stores only.
D. Limited offer of ‘Get a toothbrush free along with a 50gm toothpaste' by Crest.
E. A premium by Kellogg's that provides the customer with ‘Zip Zap toy' along with
the purchase of a 200gm pack of ‘Kellogg's Chocos'.
 Nonfranchise-Building Promotions

Objectives

Accelerate the Generate an

purchase decision immediate sales
process increase

Limitations

Do not identify Do not contribute

unique brand to brand identity or
features image
Tropicana developed a "Win the Perfect Vacation"
sweepstakes to complement an advertising campaign
theme promoting its grapefruit juice as the perfect
beverage. This is an example of:
A. a nonfranchise building promotion.
B. a franchise building promotion.
C. a high-involvement sales promotion.
D. a sales promotion trap.
E. event marketing.
 Sampling

Sampling Works Best When

The product
can be broken
The products into a small The purchase
are of piece or size cycle is
relatively low that reflects relatively
unit value the full short
features and
benefits
“Free Fryday” Promotion
 Sampling Methods

Door-to-door

Methods Direct mail

In-store
On package
Events
Newspaper/magazine insert

Other methods
 Sampling

Sampling Works
Best When

Products are
Purchase cycle
Products are of divisible and can
is relatively
relatively low be broken into
short so the
unit value, so small sizes that
consumer can
samples don’t reflect the
soon purchase
cost much products features
again
and benefits
Samples are Often Distributed With Newspapers
Armor All Uses On-Package Samples
 Couponing

The
85% of Nearly
oldest and
consumers 240 billion
most widely
use coupons; distributed
used
21% use them each year
sales
regularly in the US
promotion tool
 Pros and Cons of Coupons
Advantages Disadvantages
Appeals to price Hard to tell how many
sensitive consumers consumers will use
them and when
Can offer discounts
without retailer Often used by loyal
cooperation consumers who would
purchase anyway
Effective way to induce
trial of products Low redemption rates
and high costs
Defends market share
and encourages Misredemption
repurchase and fraud
 Most Often Used Coupons

Disposable Laundry
Cereal
Diapers Soap
 Coupon Misredemption and Fraud
– Customer redemption for a product or size not specified on the coupon
– Salesclerk redemption of coupons for cash
– Store managers gathering and redeeming coupons without the
accompanying sale
– Criminals gather or print coupons and sell them to unethical merchants
– Web-source fraud, whereby coupons are produced and distributed
online
 Coupon Distribution
• In order of usage
• Freestanding inserts (86%)
• In-store couponing (6%)
• Direct mail (2%)
• Magazines (2%)
• Newspapers (1%)
• Coupons inside/outside product (1%)
• Other methods (2%)
FSIs are the Most Popular Coupon Type
Coupon Redemption Rates
Valpak Enhances Value of Coupons
 Types of Coupons

In/On-Pack In-Store

Bounce-back Tear-off pads

Cross-ruff Handouts

Instant Dispensers

Register printout
Cross-Ruff Coupons
On the inside of the Tortino's brand pizza box was a $1-off
coupon for the purchase of the next Tortino's pizza.
Tortino's used a(n) _____ coupon.
A. cross-ruff
B. bounce-back
C. instant
D. cross sell
E. same purchase
Coupons are Available Electronically
 Premiums

An offer of an item, merchandise, or

service, free or at a low cost, that is
an extra incentive for customers

Types of Premiums

Self-liquidating:
Free:
consumer required to
Only requires purchase
pay some or all of the
of the product
cost of the premium
Airline Miles are a Popular Incentive
More Consumer-Oriented Promotions
Price-off Deals

Contests and
sweepstakes

Refunds and
rebates

Bonus packs

Loyalty programs

Event marketing
 Contests and Sweepstakes
Promotion where winners are
Sweepstakes determined purely by chance
Cannot require proof of purchase
as a condition for entry

Winners chosen by random selection from pool of

entries or generation of a number to match those
held by game entrants

Consumers compete for prizes or money on the

basis of skills or ability

Winners determined by judging entries

Contest or ascertaining which entry is closest
to predetermined criteria
Problems With Contests and Sweepstakes

Little consumer franchise building

Focus on contest/sweepstakes, not brand

Effectiveness

Negative publicity

Federal regulations

Use by professionals or hobbyists

 Trade Oriented Promotions

Obtain distribution for new

products
Objectives
Maintain support for
established brands

Encourage display of
products

Build retail inventories

 Types of Trade Oriented Promotions
Contests and incentives

Co-op Advertising
Types
Trade allowances

POP displays Buying

Sales training Promotional

Trade shows
Slotting
Coordinating Sales, Advertising, IMC Tools
Budget
allocation

Coordination
of themes
Media support
and timing
The Sales Promotion Trap
 Trade Oriented Promotions

Obtain distribution for new

products
Objectives
Maintain support for established
brands

Encourage display of products

Build retail inventories

Gillette's market research shows that most consumers decide
upon a brand of deodorant at the point-of-purchase rather than
before entering the store. Based on these findings, what form of
promotion should be most effective for Gillette's Right Guard
brand?
A. Direct mail coupons
B. Event marketing
C. Coupons distributed through freestanding inserts in
newspapers
D. In-store coupons
E. Spiffs