Chapter 17
Sales Promotion, Point-of-Purchase
Advertising, and Support Media
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© 2009 South-Western, a part of Cengage Learning
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Part Five: Integrated Brand
Promotion
We have considered the Process, Planning,
Preparation, and Placement of advertising and
IBP in the first Four Parts of the book
Now we take a detailed look at the full range of
IBP tools available to the advertiser
Each of these IBP tools has a unique capability
to influence audience perception of a brand
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Sales Promotion--Defined
“Using incentives to create a
perception of greater brand value”
Consumer Market sales promotion
– Induce household consumers to purchase a firm’s brand
Trade-Market sales promotion
– Motivate distributors, wholesalers, and retailers to stock
and feature a brand
Business Market sales promotion
– Cultivate buyers in large corporations who make
purchase decisions
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Sales Promotion Examples
Coupons Brand placements Contests
Gift Cards Allowances Sweepstakes
Incentives Sampling Price-off deals
Premiums Loyalty Programs Trade Shows
Point of Purchase Displays
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Sales Promotion vs.
Advertising
Short term demand vs. long term demand
Encourages brand switching vs. brand loyalty
Induces trial use vs. encourage repeat purchase
Promotes price vs. image
Immediate results vs. long term effects
Measurable results vs. difficult to measure
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Importance of Sales
Promotion
$300 billion in 2008
Growth rate: 4-8 percent
Reasons for growth:
– Demand for accountability
– Short-term orientation
– Consumer response to promotions
– Proliferation of brands
– Increased power of retailers
– Media clutter
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Objectives for Consumer-
Market Sales Promotion
1. Stimulate trial purchase
2. Stimulate repeat purchases
3. Stimulate larger purchases
4. Introduce a new brand
5. Combat or disrupt competitors
6. Contribute to IBP
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Consumer-Market Sales
Promotion Techniques
1. Coupons 2. Price-off deals
3. Premiums 4. Contests/sweeps
5. Samples & trials 6. Phone gift cards
7. Brand placements 8. Rebates
9. Frequency programs
[Link] sponsorship
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Coupons
Entitles a buyer to a price reduction
for a product or service
Advantages
– Give a discount to price sensitive consumer while
selling product at full price to others
– Induce brand switching
– Timing and distribution can be controlled
– Stimulates repeat purchases
– Gets regular users to trade up within a brand
array
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Ad in Context Example
Coupons
Coupons are
are
the
the most
most
widely
widely used
used
form
form of
of
consumer
consumer
sales
sales
promotion.
promotion.
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Coupons
Disadvantages
– Time of redemption cannot be
controlled
– No way to prevent current customers
from redeeming coupons
– Coupon programs require costly
administration
– Fraud is a serious, chronic problem
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Price-Off Deals
Offers consumer reduced price at
point of purchase through specially
marked packages
Advantages
– Controllable by manufacturer
– Can effect positive price comparisons
– Consumers believe it increases value
of a known brand
Disadvantage
– Retailers believe it creates inventory
and pricing problems
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Premiums and Advertising
Specialties
Premiums: free or at a reduced
price with another purchase
Free premiums provide item at no
cost
Self-liquidating premiums require
consumers to pay most of the
cost of the item
Advertising specialties:
– A message placed on a free, useful
item
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Ad in Context Example
Premiums
Premiums attract
attract
attention
attention toto aa brand
brand and
and
offer
offer the
the consumer
consumer
something
something for for free.
free.
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Contests and Sweepstakes
Contests: consumers compete for prizes
based on skill or ability.
Sweepstakes: winners picked by chance
Both create excitement and interest
But . . .
– Legal and regulatory requirements are complex
– Consumers may focus on the game rather than
the brand
– Difficult to get an IBP message across in a
game
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Samples and Trial Offers
Sampling: Giving consumer an
opportunity to use a brand on a trial basis
with little or no risk
Types of sampling
– In-store (Costco) – Newspaper
– Door-to-door – On-package
– Mail – Mobile (on-site)
Trial offers
– Used for more expensive items
– Consumer tries product for a fixed time
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Phone and Gift Cards
Manufacturers offer either for free
or for purchase debit cards
– with phone time
– or preset spending limits
Examples include offers from
Starbucks, Barnes & Noble, and
The Gap
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Rebates
Money back offer requiring the buyer to
mail a request for money back from the
manufacturer
Often tied to multiple purchases
Many consumers fail to bother sending
in the rebate request form
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Frequency Programs
Also known as continuity
programs
Offers customers discounts or
free products for repeat
patronage
Common in airline, hotel, and
restaurant businesses
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Objectives for Promotions in
the Trade Market
Objectives: Uses a “push” strategy:
Push the product into the
distribution channel to the
consumer:
– Obtain initial distribution
– Increase order size
– Encourage cooperation with
consumer market sales promotions
– Increase store traffic
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Trade-Market Sales
Promotion Techniques
Incentives: Push money
Allowances: Merchandise allowances, slotting fees, bill-
back allowances, off-invoice allowances
Sales Training Programs
Cooperative (Co-Op) Advertising
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Business Market Sales
Promotion Techniques
Trade Shows
Business gifts
Premiums and advertising specialties
Trial offers
Frequency programs
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Ad in Context Example
Trial
Trial offers
offers are
are very
very
effective
effective in
in the
the business
business
market.
market. Why?
Why?
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Risks of Sales Promotion
Create a price orientation
Borrow from future sales
Alienate loyal customers
Time and expense
Legal considerations
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Point of Purchase (P-O-P)
Advertising
Definition
– Materials used in the retail setting to attract shoppers’
attention to a brand, to convey primary product benefits, or
highlight pricing information.
– Displays may feature “price-off” deals as well.
Objectives for Point-of-Purchase Advertising
– Draw consumers’ attention to a brand in the retail setting.
– Maintain purchase loyalty among brand loyal users.
– Stimulate increased or varied usage of the brand.
– Stimulate trial use by users of competitive brands.
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P-O-P Advertising and the
Trade and Business Markets
Product displays and information sheets encourage
retailers to support one distributor or manufacturer’s
brand over another.
P-O-P promotions can help win precious shelf space
and exposure in a retail setting.
A P-O-P display should be designed to draw attention
to a brand, increase turnover, and possibly distribute
coupons or sweepstakes entry forms.
To combat losing business to online shopping, retailers
are trying to enliven the retail environment, and point-
of-purchase displays are one strategy.
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Support Media
Purpose: To reinforce or extend a message
being delivered through other media
– Signs, billboards, posters
– Transit
– Aerial
– Specialty
– Directory
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Outdoor Signage and
Billboards
Advantages Disadvantages
– Wide local – Message limits
exposure – Location affects
– Captivating impact
– Around-the-clock – Relatively expensive
exposure – Criticized by
– Address an environmental
immediate need or groups
desire
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Transit Ads
Transit Ads
– Urban environments
– Demographic segmentation
– Timely to purchase
– Build brand awareness
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Ad in Context Example
Transit
Transit ads
ads
can
can reach
reach aa
target
target
audience
audience inin
well
well defined
defined
geographic
geographic
areas.
areas.
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Aerial Ads
Aerial Ads
– Blimps increasingly
common
– Common at sporting
events
– Skies are getting
crowded!
– Networks are in
control
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Directory Advertising
Advantages Disadvantages
– High acceptance – Too many
– High availability directories
– Final link to – Long lead times
purchase – Limited creativity
New: CD-ROM and Web-
based directories
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Ad in Context Example
Web
Web based
based
directories
directories
offer
offer
convenience
convenience
and
and speed.
speed.
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Packaging
Promotional Benefits of Packaging to the
Advertiser:
– The package carries the brand name and logo
– The package can communicate “value”
– The package can communicate “image” and
“quality”
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Ad in Context Example
Packaging
Packaging
highlights
highlights
the
the brand
brand
name,
name,
quality
quality and
and
image.
image.
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When Support Media are
More than Support Media
Guerrilla Marketing—”Stunt” promotions
Viral campaigns—Using influencers
(Chapter 20)
Special Events—Creating visibility and
“affinity” for a brand among a highly select
target group
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