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Higher Business > Promotion - Out-of-the-Pipeline > Flashcards

Promotion - Out-of-the-Pipeline Flashcards

1
Q

What is Out-of-the-pipeline?

A

Out-of-the-pipeline sales promotions are offered by the retailers to encourage customer to purchase products from them.

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2
Q

What are methods of Out-of-the-pipeline?

A
  • Special offers
  • Free gifts
  • Vouchers and coupons
  • Loyalty schemes
  • Interest-free credit
  • Free trials/sample packs
  • Competitions
  • Trade shows and events
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3
Q

What are special offers?

A

This can include Buy One Get One Free (BOGOF) and other short-term promotions on selected items.

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4
Q

What are the advantages of special offers?

A
  • This can encourage customers to try new products, which they may then purchase again at normal price.
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5
Q

What are the disadvantages of special offers?

A
  • Customers might feel pressured into buying more than they need, which may result in waste.
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6
Q

What are free gifts?

A

Used to tempt customers to buy a product again or for the first time.
Example: A free toy in a children’s cereal.

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7
Q

What are the advantages of free gifts?

A
  • Gifts that required multiple tokens/stamps can encourage repeat purchases.
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8
Q

What are the disadvantages of free gifts?

A
  • It can be difficult to find a gift that appeals to all target markets.
    Example: a free gift that suits boys and girls.
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9
Q

What are vouchers and coupons?

A

Usually given in newspapers/magazines to give customers money off future purchases.

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10
Q

What are the advantages of vouchers and coupons?

A
  • Customers feel they are getting better value for money, which attracts new customers.
  • It can encourage repeat purchases.
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11
Q

What are the disadvantages of vouchers and coupons?

A
  • Discounts offered by money-off vouchers can reduce profits.
  • Some customers will only spend up to the value of the money-off vouchers, limiting sales.
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12
Q

What are loyalty schemes?

A

Allows customers to collect points by making purchases, which can then be exchanged for discounts or free products in the future.
Example: Tesco Clubcard.

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13
Q

What are the advantages of loyalty schemes?

A
  • Information on customer habits and preferences can be gathered.
  • Promotions can be targeted to reflect actual customer preferences.
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14
Q

What are the disadvantages of loyalty schemes?

A
  • Customers can be wary if they feel the scheme will be difficult to set up or opt out of.
  • These are time consuming and expensive to implement.
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15
Q

What is interest-free credit?

A

Retailers offer customer credit to pay for good at a later date.

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16
Q

What are the advantages of interest-free credit?

A
  • Allows customers to purchase products and then pay for them when they can afford to.
17
Q

What are the disadvantages of interest free-credit?

A
  • This could lead to bad debt it many customers are unable to pay by the agreed date.
18
Q

What are free trials/sample packs?

A
  • Services like Netflix and Audible offer a free trial for a month. New products are often given aways as a sample.
    Example: Perfume in a magazine.
19
Q

What are the advantages of free trials/sample packs?

A
  • Customers can try the product and if they like it, will purchase as full price.
  • Word of mouth can spread from customers enjoying free trials and samples.
20
Q

What are the disadvantages of free trials/sample packs?

A
  • Some customers only use the free trial, which will cost the business with no return.
  • It is possible for customers to use a free trial multiple times.
21
Q

What is competitions?

A

Businesses can use competitions to encourage customers to buy in order to take part.
Example: Mcdonald’s Monopoly.

22
Q

What are the advantages of competitions?

A
  • Can encourage repeat custom as customers try to win or collect more tokens.
  • Can create hype and excitement around a product, which can lead to new custom.
23
Q

What are the disadvantages of competitions?

A
  • Prizes can cost substantial amounts of money.
  • The associated marketing cost of the competitors can be high and often packaging has to be redesigned.
24
Q

What is trade shows and events?

A

Attending industry trade shows or events such as the Royal Highland Show to give out samples and engage with the public.

25
Q

What are the advantages of trade shows and events?

A
  • Feedback from customers can be gained.
  • Giving our merchandise can spread work/images of the brand.
26
Q

What are the disadvantages of trade shows and events?

A
  • Some shows have very high rates for a stall.
  • Large quantities of free goods have to be given away for maximum impact.

Higher Business (49 decks)

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