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