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7/28/2019 MM2 Fixed Writtenreport

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SALES PROMOTIONS STRATEGY

Promotions have four elements called the Promotions Mix:

1. Advertising- to effectively inform and persuade target market.

2. Public Relations- to offer a positive image of the company and the brand.3. Selling- to get the customers to buy.

4. Sales Promotions- to convince customers to buy immediately.

Characteristics of Sales Promotion

1. Temporary

Sales promotions are conducted on short durations.

2. Better Value

As similar products are looked at in a similar sense, sales promotions are used to

create short-term product differentiation via offering a better product value.

3. Beneficial

Sales promotions promote growth, sometimes however, even at an artificial level.

TRADE PROMOTIONS

Trade promotions are designed to convince trade channels like retailers and wholesalers

to buy immediately, or to buy more than their usual quantity.

Examples of Trade Promotions

1. Cooperative Advertising

It happens when supplier and his trade customers share in paying for an advertising

campaign.

2. Discounts and Terms

Discounts are straight deductions from the list price.

3. Display Allowance

Display allowances are financial support granted to the trade outlet for the performance

of in-store display requirements.

4. Free Products

Free products promotions involve giving of additional quantity of products on top of

regular purchase volume.

5. Trade Contest

Goldstar appliances once launched their best window display contest in 1991 after

sponsoring a seminar on window display to the artists of their appliance retailers.

6. Rebates/Rewards



Marketers may offer year-end rebates as a token of appreciation for the loyalty of their

dealers.

7. Push Pin Money

A variety of rewards promotions is Push Pin Money which is money given to thesalesclerks of the dealers (and frequently including the dealers themselves) to push the firm’s

products.

8. Personality

Mystery buyer is an example. If the saleslady of the trade store will recommend the

specific brand of your company, she is entitled to an incentive.

9. Exhibits

Joining exhibits and tradeshows is a cost-effective way to create awareness, and generate

sales leads, most specially for business-to-business products and high priced consumer durables.

10. Conferences/Training

Conferences and training are promotions which advance goodwill with the trade.

CONSUMER PROMOTIONS

Consumer promotions are designed to convince end-users to buy immediately or to buy

more than their usual quantity.

1. Sampling

Sampling is a limited amount of the free products offered to consumer.

2. Coupons

Coupons are certificates entitling the bearer to a published saving on the purchase of a

specific product.

3. Price-Off

Price-offs are promotions that offer immediate savings upon purchase.

4. Rebates

Rebates are like coupons except that the price reduction is usually larger and are given

after the purchase rather than at the point of sale.

5. Bonus Packss

Bonus packs involve giving extra quantity of the same product without increase in price.

6. Sample Packs

Sample packs involve trial size of a product at a price usually lower than market standard.



7. Special Packs

Products combined as single packs can bring savings for consumer.

8. Premiums

Premiums are free gifts offered as incentive to purchase a particular product.

9. Self – Liquidating Promotions

The marketers can recover all his expenses for the promotion, and sometimes even

experience profit.

10. Free Trial

This type of promotions invites prospective customers to try the product without cost in

the hopes that they will buy the product.

11. Warranty

Warranty reduces the risk factor in a purchase, most especially for high involvement or

high-priced products and service.

12. Prizes

Consume may be offered an opportunity to win a prize after purchasing product.

13. Patronage Reward

Consumer may be given an incentive in promotion to the volume of product regularly

purchased.

14. Contest

Contest are promotions given to consumers to have a chance of winning something of

value.

15. Personality

“Mystery Visitor” is a common form of personality promotion this entails the consumer to show the product of the company of the mystery visitor to win a prize.

SALES PROMOTION PLAN

Like any project, a sales promotion needs a written plan. This is to ensure that all

elements of the sales promotion are defined and agreed upon.

1.) Title

This is name given to the sales promotion

2.) Objective

Objectives answer the question “why are you having a sales promotion? “This means that

no sales no sales promotion should be implemented if no improvement will be experienced

objective also answer the question “what problems do you want to solve?



SMART OBJECTIVES

S pecific – not vague

Measurable – than can be quantified

Attainable – and not overly ambitious

R ealistic – and must consider constraints

Trackable – with checkpoints capable of being monitored to ensure improvement.

3.) Coverage

Coverage defines the specific territories included in the sales promotion.

4.) Duration

Duration identifies the length of the promotion.

5.) Offer

An offer identifies the type and size of promotion to be executed.

6.) Mechanics

This section identifies approaches to the achievement of objectives.

7.) Communications

How to communicate the sales promotions at the start, during, and after the promotions

duration is as important as the sales promotions itself.

8.) Key factors for success

1. Strong trade support2. A short promotion period

3. A high level of incentives

4. Dual promotions

5. The support of salesforce and the trade

9.) Budget

The cost to promote section is critical. Marketers must answer questions like “will share

and profit increase?

The two most common ways of establishing sales promotion budget are:

1.) Objective – task method

Objectives are defined to determine the intensity of strategies and tactics. They must be

concrete and clear to the marketer.



2.) Percentage of sales method

Pegs a specific percent of sales promotional budget to anticipated sales.

ADVERTISING STRATEGY

Advertising serves several purposes.

1. Brand advertising, which aims to stimulate demand for particular brand.

2. Institutional advertising, which aims to develop goodwill for a company or industry.

3. Classified advertising, which aims to inform prospects regarding opportunities such as buy and sell, events, and employment.

4. Promotional advertising, which aims to inform prospects about promotional activitiessuch as special sale.

5. Advocacy advertising, which aims to convince audience regarding a particular cause.

Advertising Objectives

TO INFORM target customers about:

1. New product2. Product function3. Correct usage

4. New uses

5. New distribution6. Price adjustment

TO PERSUADE target customers about:

1. Brand preference

2.

Brand switching3. Urgency to buy now4. Action to be taken ( phone-in inquiry)

Advertising Mix

Advertising decisions to be decided before an advertising program can be implemented.

1. WHAT to say (message)

2. HOW to say (copy execution)3. WHERE to say (media selection)

4. WHEN to say ( media scheduling)

Positioning



Positioning is the act of communicating to consumers the overall positive impression for

brand, relative to the competition.

Repositioning

Repositioning is done to change the past perceptions of the target consumer.

Repositioning has two concepts.

1. The first one is changing an old brand positioning to a new brand positioning.

2. The second one attempts to change consumer perception of competitors.

COPY STRATEGY

The following are the stages in creating advertising:

1. Preparation of copy strategy and or brief from which the creative team must work.

2. The creative process itself where the output is a storyboard (similar to a comic strip) inthe case of a TV advertisement; and script (with or without jingle) in the case of

commercial.

3. Evaluation of the creative output. This could be a combination of logic, research and

judgement.

Copy Brief

Copy brief or copy strategy is basic proposition, consumer promise, or statement of benefit.

Guide questions are very important before a copy brief can be written.

They are:

1. Brand Overall Objective

Is our objective to create new uses, or more usage for our brand?

2. Target Market

What is the demographic and psychographic profile of the primary and secondary

target market we plan to reach?

3. Diagnostic Positioning

In terms of competitive standing, what attributes are important to the customers

where we have the advantage?

4. Factor influencing product purchase

This answers the where, how, how often, size, variants bought as can be gathered in a

usage, attitude, and interest (UAI) survey.

Advertising Execution

Advertising message can be presented in at least 9 execution styles as follows:



1. Slice Of Life

2. Scientific Evidence

3. Testimonial Evidence

4. Technical Expertise

5. Lifestyle

6. Fantasy

7. Image

8. Musical

9. Personality Symbol

MEDIA PLAN: WHERE and WHEN to advertise

Exposure (E) is the placement in a media vehicle such as TV, radio, print newspapers,

magazines, that the target audience is known or expected to see, hear, or read.

To find the audience, three important and interrelated exposure variables must be

considered:

1. Reach (R) or the number of consumers exposed to a particular advertising at least

once during the specified duration.

Reach is composed of two types:

a. Registration – or people who correctly recall and playback something

meaningful

b. Recognition – or people who could not playback anything meaningful, but

recognize the advertisement.

2. Frequency (F) or the number of times consumers are reached.

3. Impact (I) or the qualitative value of an exposure though a given medium size.

Gross Rating Point (GRP) and Cost per Thousand (CPM)

Gross Rating Point or GRP is the result of combining Reach(R) and Frequency (F).

Thus, E = R x F. If a given media plan reaches 60% or the homes with an average frequency of

10 in a week, the media plan is said to have a GRP of 600 points (60 x 10) for that particular

week.

Cost per thousand (CPM) is a term used to compare the cost effectiveness of various

media. It is the media cost of gaining exposure to 1,000 persons with an advertisement.



PEOPLE METER

Most ratings of TV shows are done using 110 of each AB, C, and DE households (total

330) as TV rating panel.

ADVERTISING TESTING

There are many ways to test effectiveness of advertising materials.

The BUY TEST utilizes a one-on-one interview technique with a minimum of 130

respondents per advertising material to be tested.

BUY TEST BUY SCHALE

Recall

The first step in the BUY TEST is to determine the extent of understanding of the visual

as well as the copy elements of the advertisement.

Involvement

The feelings or Involvement stage seeks to determine the levels of consumer emotional

reactions to the advertisements, plus their own interpretation of its visual and copy elements.

Persuasion

Consumers reaching the Persuasion stage demonstrate a high commitment to the productwith a burning desire to act on the advertising message.

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