Know the role of sampling, the forms of sampling, and the trends in sampling practice.. Be aware of the role of couponing, the types of coupons, and the developments in couponing pract
Trang 1Sampling and Couponing
CHAPTER 16
Trang 21 Appreciate the objectives of consumer-oriented sales
promotions.
2 Recognize that many forms of promotions perform different
objectives for marketers.
3 Know the role of sampling, the forms of sampling, and the
trends in sampling practice.
4 Be aware of the role of couponing, the types of coupons,
and the developments in couponing practice.
5 Understand the coupon redemption process and
Trang 3Why Use Consumer Promotions?
• Promotions
competitor
frequently
Trang 4Brand Management Objectives
• Brand Management
than initiating trade or sales-force action
Trang 5Consumer Rewards
• Utilitarian (Functional) Benefits of Rewards
coupons)
of a promotional offer, consumers do not have to think about other alternatives)
a price reduction that allows consumers to buy
superior brands they might not otherwise purchase
Trang 6Consumer Rewards (cont’d)
• Hedonic Benefits of Rewards
taking advantage of sales promotions
trying a brand that might not purchased if it were not for an attractive promotion
consumer competes in a promotional contest or
participates in a sweepstakes
Trang 7Consumer Rewards (cont’d)
• Other Rewards
function by influencing consumer beliefs about a
brand
• Timing of Rewards
some other form of benefit as soon as the consumer performs a marketer-specified behavior
behavior by a period of days, weeks, or even longer
Trang 8Major Consumer-Oriented Promotions
Table 16.1
Trang 9Notes on Table 16.1
• The classification of promotional tools is
necessarily simplified
• Promotions are capable of accomplishing more
than a single objective
• Manufacturers use consumer-oriented sales also
to leverage trade support
• Coupons and premiums achieve different
objectives depending on the specific form of
delivery vehicle
Trang 10• Sampling
product to consumers
• Why Sampling Is Effective
new brand personally
passive encounter, as is the case with the receipt of promotional techniques such as coupons
products that can afford this form of promotion
Trang 11Sampling Methods and Media
Direct Mail • Mailed directly to households targeted by
demographic characteristics or geodemographics
Newspapers
and Magazines
• Samples included in magazines and newspapers represent cost-efficient forms of sampling for reaching a mass audience
Door-to-Door
Distribution
• Allows considerable targeting and has
advantages of lower cost and short lead times between a sampling request and when the samples are delivered to targeted households
On- or In-pack
Sampling
• Uses the package of another product to serve
as the sample carrier
Trang 12Sampling Methods and Media
High-Traffic
Locations
• Shopping centers, movie theaters, airports, and
special events offer valuable forums for sample distribution
• Choosing unique locations for sampling
products appropriate for people at a certain stage of life, referred to as change-point sampling
Internet
Sampling
• Distributing samples online through the services
of companies that specialize in online sample delivery
Trang 13Sampling Charmin
via a Fleet of
Tractor Trailers
Figure 16.1
Trang 14Major Sampling Practices
Targeting rather than
mass distributing
samples
Using innovative distribution methods where appropriate
Undertaking efforts to measure sampling’s return on investment
Prudent Sampling
Practices
Trang 15Calculating the ROI for a Sampling Investment
Table 16.2
costs of distribution—mailing, door-to-door distribution, and so on Assume, for example, that the cost of distributing a trial-sized unit is $0.60 and that 15,000,000 units are distributed;
hence, the total cost is $9 million.
product and multiplying this by the per-unit profit Assume, for example, that on average six units of the sampled product are purchased per year and that the profit per unit is $1 Thus, each user promises the company a profit potential of $6 when they become users of the
sampled brand.
(Converters are individuals who after sampling a brand become users.) Given the cost of the sampling program ($9 million) and the profit potential per user ($6), the number of
conversions needed in this case to break even is 1,500,000 (i.e., $9 million divided by $6) This number represents a 10 percent conversion rate just to break even (i.e., 1,500,000
divided by 15,000,000).
conversion rate must exceed the break-even rate with gains in the 10 to 16 percent range In this case, this would mean a minimum of 1,650,000 people must become users after trying the sampled brand (i.e., 1,500,000 times 1.1) to justify the sampling cost and yield a reasonable
Trang 16When Should Sampling Be Used?
1 When the new or improved brand is
demonstrably superior or has distinct relative advantages
2 When an innovative product concept is difficult
to communicate by advertising alone
3 When promotional budgets can afford to
generate consumer trial quickly
Trang 17Sampling Challenges and Problems
• Expensive to implement
• Mishandling of mailing by distributors
• Distribution to the wrong market
• In- or on-package samples fail to capture
current non-consumers
• Distribution does not reach sufficient
numbers of consumers to justify its expense
• Misuse of samples by customers
• Subject to mail pilferage
Trang 18• Coupon
purchasing the coupon-offering brand by providing
cents-off savings
• Couponing Background
the United States
Trang 19Illustration of Cents-Off Coupon Offers
Figure 16.2
Trang 20Coupon Distribution Methods
• Freestanding Inserts (FSIs)
Trang 21Full Coupon Cost
Table 16.3
4 Consumer fraud (misredemption) cost 0.07
5 Internal preparation and processing cost 0.02
Trang 22Couponing (cont’d)
• Is Couponing Profitable?
the most likely to buy the brand in the first place
consumers to other brands that do offer coupons
Trang 23Point-of-Purchase Couponing
Instantly Redeemable
Coupons
Shelf-Delivered Coupons
Scanner-Delivered Coupons
Point-of-Purchase
Coupons
Trang 24Mail- and Media-Delivered Coupons
Mail-Delivered
Coupons
coupons (3.5%)
high market share
FSIs and Other
Trang 25In- and On-Pack Coupons
purchase
brand (crossruffing)
Trang 26Online Couponing
• Are distributed by many Internet sites
• Allows consumers print their own coupons, at no
additional cost to the advertiser
• Has potential for fraud in that criminals can alter
their printed coupons
• Can be distributed through consumer’s
telephone (wireless connection)
Trang 27Coupon Redemption and Misredemption Process
Figure 16.3
Trang 28• Consequences of Misredemption
millions of dollars in losses by manufacturers
Trang 29The Role of Promotion Agencies
• Specialized Promotion Agencies
strategies and implement tactical programs
• The Rise of the Online Promotion Agency
online promotions—coupons, sweepstakes offers,
online promotional games, free sample offerings, and online continuity programs