Consumer promotions

Frequent buyer program

A loyalty program in which loyal consumers are rewarded for making multiple purchases

Type of promotion

- Analyze benefits and risks - Consider testing before rollout - Consistent with budget - Goal: generate attractive benefits for greatest number of consumers

Promotion Goals

- Boost short term sales - Introduce new product - Reposition product - Bundle existing products - Capitalize on holidays - Revive dormant products

Promotion budget

- Build into marketing budget - Allocate to various media - Plan for maximum impact - Justify $$$ benefits - Costs must not exceed benefits

Evaluate promotion

- Compare outcomes to goals - Cost/benefit analysis - Isolation effect - Evaluate program components - Strategy evaluation - Lessons for future

Consumer promotions

- Coupons and rebates - Premiums - Loyalty marketing programs - Contests and sweepstakes - Sampling - Point-of-purchase promotion

Target audience

- New or existing customers - Motivation (hedonic or utilitarian) - DBM - emotional, rational, patronage, product - Group influences - Geodemographic targeting

New developments

- RIFD tracking of products - Learning labs: retail stores using video surveillance to monitor shopping behavior - Mobile technology

Consumer promotion

- Set of actions to stimulate sales by influencing the end consumer - Short-term strategies designed to motivate customers to buy

Key Questions

1. What's the goal of your promotion> 2. Who is your primary target audience? 3. What is your promotion budget? 4. What type of promotion will work best? 5. How will you evaluate your promotion?

Rebate

A cash refund given for the purchase of a product during a specific period

Coupon

A certificate that entitles consumers to an immediate price reduction

Sampling

A promotional program that allows the consumer the opportunity to try a product or service for free

Premium

An extra item offered to the consumer, usually in exchange for some proof of purchase

Point-of-purchase

Promotional display in retail location

Sweepstakes

Promotions that depend on chance or luck, with free anticipation

Contest

Promotions that require skill or ability to compete for prizes