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43 Cards in this Set
- Front
- Back
sales promotion
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a direct inducement that offers an extra value or incentive for the product to the sales force, distributors, or the ultimate consumer with the primary objective of creating an immediate sale.
-usually provides an extra incentive to buy -essentially an acceleration tool, designed to speed up the selling process and maximize sales volume -can be targeted to different parties in the marketing channel |
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consumer-oriented sales promotion
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includes sampling, couponing, premiums, contests and sweepstakes, refunds and rebates, bonus packs, price-offs, frequency programs, and event marketing.
-directed at consumers |
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trade-oriented sales promotion
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includes dealer contests and incentives, trade allowances, point-of-purchase displays, sales training programs, trade shows, cooperative advertising, and other programs designed to motivate distributors and retailers to carry a product and make an extra effort to push it to their consumers.
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factors contributing to the increase in sales promotion
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-maturation of the promotion industry (more sophisticated)
-growing power of retailers (can now measure results of each product through scanner data, consolidation of grocery store industry, Wal-mart) -declining brand loyalty -increased promotional sensitivity -brand proliferation (market saturated with new brands) -fragmentation of the consumer market (need more targeted approaches) -short-term focus of many marketers -increased accountability (measurable results) -competition -clutter |
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account-specific marketing (co-marketing)
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a manufacturer collaborates with an individual retailer to create a customized promotion that accomplishes mutual objectives.
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consumer franchise building (CFB) promotions
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sales promotion activities that communicate distinctive brand attributes and contribute to the development and reinforcement of brand identity.
-ability to convert consumers to loyal customers |
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nonfranchise-building (no-FB) promotions
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designed to accelerate the purchase decision process and generate an immediate increase in sales.
-do not communicate information about a brand's unique features or the benefits of using it |
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objectives of consumer-oriented sales promotion
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-obtaining trial and repurchase
-increasing consumption of an established brand -defending current customers -targeting a specific market segment -enhancing integrated marketing communications and building brand equity |
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sampling
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involves a variety of procedures whereby consumers are given some quantity of a product for no charge to induce trial
+excellent way to induce trial +consumers get to experience the brand directly -must have some unique or superior benefits -some products are difficult to gauge immediately |
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criteria for effective sampling program
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1. products are of relatively low unit value
2. products are divisible, which means they can be broken into small sample sizes that are adequate for demonstrating the brand's features and benefits to the user. 3. the purchase cycle is relatively short, so the consumer will consider an immediate purchase or will not forget about the brand before the next purchase occasion. |
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sampling methods
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-door-to-door sampling
-sampling through mail -in-store sampling -on-package sampling -event sampling -Internet |
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couponing
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+can offer price reduction only to those consumers who are price-sensitive
+encourage repurchase after initial trial +encourage to try more expensive brand -difficult to estimate when a consumer will use a coupon -difficult to prevent the coupons from being used by consumers who already use the brand -low redemption rates and high cost -misredemption (fraud) |
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coupon distribution methods
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-freestanding inserts (most popular)
-direct mail -newspapers/magazines -inside or outside package |
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bounce-back coupon
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an in/on-pack coupon that is redeemable for the next purchase of the same brand
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cross-ruff coupon
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and in/on-pack coupon which is redeemable for a different product
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instant coupon
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attached to the outside of the package so the consumer can rip it off and redeem it immediately at the time of purchase.
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in-store couponing
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all co-op couponing programs distributed in a retail store environment.
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premiums
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an offer of an item of merchandise or service either free or at a low price that is an extra incentive for purchasers.
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free premiums
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usually small gifts or merchandise included in the product package or sent to consumer who mail in a request along with a proof of purchase. (consumers' favorite type of promotion)
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self-liquidating premiums
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require the customer to pay some or all of the cost of the premium plus handling and mailing costs.
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contest
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a promotion where consumers compete for prizes or money on the basis of skills or ability
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sweepstakes
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a promotion where winners are determined purely by chance; it cannot require a proof of purchase as a condition for entry
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refunds (rebates)
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offers by the manufacturer to return a portion of the product purchase price, usually after the consumer supplies some proof of purchase.
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bonus packs
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offer the consumer an extra amount of a product at the regular price by providing larger containers or extra units.
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price-off deal
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reduces the price of the brand (right on the package) ex. 25% free
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loyalty programs
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continuity or frequency program. encourages customer loyalty
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event marketing
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a type of promotion where a company or brand is linked to an event or where a themed activity is developed for the purpose of creating experiences for consumers and promoting a product or service.
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event sponsorship
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an integrated marketing communications activity where a company develops actual sponsorship relations with a particular event and provides financial support in return for the right to display a brand name, logo, or advertising message and be identified as a supporter of the event.
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summary of consumer-oriented promotions and marketer objectives
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chart on page 539
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objectives of trade-oriented sales promotion
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-obtain distribution for new products
-maintain trade support for established brands -encourage retailers to display established brands -build retail inventories |
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push money
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cash payments made directly to the retailer's or wholesaler's sales staff to encourage them to promote or sell a manufacturer's product.
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trade allowances
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a discount or deal offered to retailers or wholesalers to encourage them to stock, promote, or display the manufacturer's products.
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off-invoice allowance
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a certain amount or percentage is deducted from the invoice
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slotting allowances
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fees retailers charge for providing a slot or position to accommodate the new product.
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failure fees
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paid if a product does not hit minimum sales level within a certain time.
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forward buying
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stocking up on a product at the lower deal or off-invoice price and resell it to the consumers after the market's promotional period ends.
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diverting
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a retailer or wholesaler takes advantage of the promotional deal then sells some of the product purchased at the low price to a store outside its area or to a middleperson who resells it to other stores.
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planograms
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configurations of products that occupy a shelf section in a store.
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trade show
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a forum where manufacturers can display their products to current as well as prospective buyers.
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cooperative advertising
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the cost of advertising is shared by ore than one party
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horizontal cooperative advertising
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advertising sponsored in common by a group of retailers or other organizations providing products or service to the market
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ingredient-sponsored cooperative advertising
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supported by raw materials manufacturers; its objective is to help establish end products that include the company's materials and/or ingredients.
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vertical cooperative advertising
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a manufacturer pays for a portion of the advertising a retailer runs to promote the manufacturer's product and its availability in the retailer's place of business.
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