sales promotion, advertising and distribution channels

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Sales Promotion, Adervertising and Distribution Channel

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Page 1: Sales promotion, advertising and distribution channels

Sales Promotion, Adervertising and Distribution Channel

Page 2: Sales promotion, advertising and distribution channels

What is Sales Promotion?

Various techniques to enhance brand value Integrated activity: Ad/PR/Marketing

Increasing brand value for: Consumers

Consumer sales promotion Retailers

Trade-market sales promotion

Page 3: Sales promotion, advertising and distribution channels

Major Sales Promotion Tools Coupons Price-off deals Premiums Contests/sweepstakes Samples/trial offers Product placement Refunds Rebates Frequency programs

Page 4: Sales promotion, advertising and distribution channels

Major Sales Promotion Tools Point-of-purchase displays Incentives Allowances Trade shows Cooperative advertising

Page 5: Sales promotion, advertising and distribution channels

Coupons Advantages:

Some consumer respond to price incentives Coupon users are likely brand switchers Manufacturer controls timing of drop Repeat—coupon chain build brand loyalty Induce users to try upscale model

Disadvantages: Current users use coupons, reducing profits High cost of administering coupon program Fraudulent use of coupons

False redemption by consumers and retailers

Page 6: Sales promotion, advertising and distribution channels

Price-off & Premiums 10-25% price reduction incentive

Comes out of manufacturer’s pocket Regular users often stock up on product

Products offered free as premium Products inserted inside other products

Free Printer with laptop purchase Products exchanged for proof of purchase Might be an additional amount of same product

Page 7: Sales promotion, advertising and distribution channels

Contests and Sweepstakes

Contest: consumers compete based on skill Sweepstakes: winner selected by chance

Scratch-off cards, McD’s Monopoly game Problems:

High cost of administration/prizes Regulations and restrictions Consumer focus on the game over the product

Page 8: Sales promotion, advertising and distribution channels

Sampling and Trial Offers Useful for new products Existing products with weak market shares in

specific geographic areas Types of Sampling:

In-store sampling Door-to-door — newspaper insertion Mail sampling — targeted zip codes On-package sampling — shampoo to conditioner Mobile sampling — Weinermobile Trial offers — free for a limited time

Page 9: Sales promotion, advertising and distribution channels

Product Placement Products inserted into movies and TV

Started with Reese’s Pieces in ET

Firms specialize in product placements Reality TV, Sitcoms, Film, Sports

Page 10: Sales promotion, advertising and distribution channels

Frequency Programs Frequent flyer programs Loyal customer rewards

To induce brand loyalty To increase sales volume

Similar to rebates Money returned after purchase Can induce multiple purchases

Page 11: Sales promotion, advertising and distribution channels

Objectives for Consumer Sales Promotion

Stimulating trial purchase E.g., Free trial product / Coupons

Stimulating repeat purchases E.g., Frequent flyer / Hotel rewards programs

Stimulating larger purchases E.g., Two-for-one price reduction

Introducing a new brand E.g., Trials inserted into newspapers

Combating competitor’s strategy Discount response to competitor’s product launch

Page 12: Sales promotion, advertising and distribution channels

P.O.P. Displays and Incentives Drawing attention to product on shelf

May also include: coupons and sweepstakes forms Increases sales for retailers

Awards of travel certificates, gifts, cash bonuses for reaching sales targets Motivating the sales force at P.O.P.

Page 13: Sales promotion, advertising and distribution channels

Allowances Merchandise allowances

Free product Can reward retailer for featuring display Slotting fees: direct cash to stock item

Page 14: Sales promotion, advertising and distribution channels

Trade Shows Related products from different

manufacturers Impressing retailers and consumers with the latest

product developments Tech - Consumer Electronics Show Automobiles - NAIAS - Detroit

Page 15: Sales promotion, advertising and distribution channels

Sales-training Programs Manufacturer provides training

Helps retail sales force Complex products like computers

Demonstrational videos and brochures

Page 16: Sales promotion, advertising and distribution channels

ADVERTISING

Page 17: Sales promotion, advertising and distribution channels

Advertising

Advertising is any paid form of nonpersonal presentation and promotion of ideas,goods,or services by an identified sponsor.

Page 18: Sales promotion, advertising and distribution channels

The 5 Ms of Advertising

Page 19: Sales promotion, advertising and distribution channels

Advertising objective

A specific communication task to be accomplished with a specific target audience during a specific period of time.

Page 20: Sales promotion, advertising and distribution channels

Advertising Objectives

Informative advertising Persuasive advertising Reminder advertising

Page 21: Sales promotion, advertising and distribution channels

Advertising strategy

1.Creating the advertising message Message strategy Message execution2.Selecting advertising media Deciding on reach ,Frequency, and Impact Choosing among major media types Selecting specific media vehicles decide on media timing

Page 22: Sales promotion, advertising and distribution channels

DISTRIBUTION CHANNEL

Page 23: Sales promotion, advertising and distribution channels

Distribution Channels

A set of interdependent organizations (intermediaries) involved in the process of making a product or service available for use or consumption.

Page 24: Sales promotion, advertising and distribution channels

Nature and Importance of Distribution Channels Distribution channels is the circulatory system of a

hospitality company. Competition, a global marketplace, electronic distribution

techniques have increased the importance of distribution. In the global economic market, companies should create

innovative ways to approach to new and existing markets

Page 25: Sales promotion, advertising and distribution channels

Distribution Channel Functions

Information: gathering and distributing marketing research and intelligence information about the marketing environment.

Promotion: developing and spreading persuasive communications about an offer

Contact: finding and communicating with prospective buyers

Matching: shaping and fitting the offer to the buyer’s needs, including such activities as manufacturing, grading, assembling, and packaging.

Page 26: Sales promotion, advertising and distribution channels

Wholesaler Jobber Retailer Consumer

Consumer

Retailer Consumer

Producer0-level channel

Wholesaler Retailer Consumer Producer2-level channel

Producer

3-level channel

1-level channelProducer

Channel Level - Each Layer of Marketing Intermediaries that Perform Some Work in Bringing the Product and its Ownership Closer to the Final Buyer.

Number of Channel Levels

Page 27: Sales promotion, advertising and distribution channels

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