Lecture 8 - Communication Tools 3 (sales promotion & PR and sponsors) Flashcards
What are coupons
A coupon offers a price reduction to the consumer.
They can be in the form of print media (freestanding inserts (FSI)), direct mail or flyers, mobile/digital, in-store, in-or-on package.
Research has shown that there may be some advantages to physical coupons (but this may change with time).
As buyer habits change (due to tech change, pandemics, shopping norms), so too should coupons
Disadvantages of coupons
- 80% of coupons are redeemed by customers who prefer brand (but these individuals are often willing to pay full price) you are giving a discount to people who are already buying it.
- But this might encourage “stocking up” or buying more of the product (which reduces brand switching)
- Coupons may also be counterfeited, redeemed for the wrong product (or customers expect the wrong product), or misunderstood.
Premiums
prizes, gifts, or other special offers consumers receive when purchasing products
Free-in-mail premiums
Customer receives a gift for purchasing a product.To recieve the gift, the customer mails in a proof of the purchase.
In-or-on package premiums
Small gifts built into the packaging of a product
Store or manufacturer premiums
Gifts given by the store or manufacturer when the customer purchases a product
Self-liquidating premium
Requires the consumer to pay a small amount of money for the premium
Successful premium programs
- Match the premium to the target market
- Carefully select the premiums (avoid fads, try for exclusivity)
- Pick a premium that reinforces the firm’s product and image
- Integrate the premium with other IMC tools (especially advertising and POP displays)
- Don’t expect premiums to increase short-term profits
Contests
require the participant to perform an activity (often purchase) –> timHortons “Déroule le rebord”
sweepstakes
do not involve activity from the consumers
Extrinsic vs intrinsic value
Extrinsic Value = the actual attractiveness of the prize
Intrinsic Value = the attractiveness of engaging in the process (e.g., skill testing questions, domain expertise, enjoyable pursuits)
Refunds and rebates
cash returns given to consumers or businesses following purchases of products. The customer pays full price and mails in proof of purchase before receiving refund/rebate
Consumer claim around 30% of all refunds/rebates (this number rises to 65% when the refund/rebate is >$50). If a rebated is expected, customers will often wait to purchase a product until one is available.
Refund VS Rebate
- Refund = “soft goods” (e.g., clothing, retail)
- Rebate = “hard goods” (e.g., major ticket items, appliances, cars)
Sampling
delivery of a product to consumers for their use or consumption as a test or trial. Sampling provides an effective way to introduce a new item, generate interest in it, and collect consumer information. Consumers are often willing to provide their information in exchange for a sample.
Different kind of sampling
- In-store sampling
- Direct sampling (i.e., mailed)
- Response sampling (i.e., send in and receive)
- Media sampling (e.g., in magazines and other media outlets)
- Professional sampling (e.g., doctors providing sample medicine)
- Selective sampling (i.e., state fairs, parades, sporting events)
