Promotion and the marketing channel

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Promotion and the marketing channel

• Module 7
• Chapter 12

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Lecture overview

• What is a promotional strategy
• Elements in the promotion mix
• Pull and push promotional strategies
• Gaining channel member cooperation for
  promotional programs
• Improving push promotional programs
• Basic push promotional strategies
• Kinder and gentler push promotional strategies

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Promotional strategy is.

• A controlled, . program of communications
  methods and materials
• Designed to present a company and its products to
  prospective customers
• To communicate need-satisfying attributes of
  products
• Toward the end of facilitating . and thus
  contributing to long-run . . (Rosenbloom
  1999, p. 370)

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Q What are the elements in the promotion mix?
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Pull and push promotional strategies
Manufacturer
demand
promotion
Wholesaler
Retailer
End-user
Pull promotional strategy
Push promotional strategy
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Q What is the aim of pull promotional strategies
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Push promotional strategies

• encourage intermediaries to. , ., and
  . the manufacturers product
• gain .., participation and cooperation of
  intermediaries
• In US, discounts and allowances account for about
  45 of the total promotional budget for consumer
  packaged goods
• new products vie for shelf space

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Basic push promotional strategies

• Cooperative advertising
• Promotional allowances
• Displays and selling aids
• In-store promotions
• Contests and incentives
• Special promotional deals and merchandising
  campaigns
• Refer to table 7.1, p. 7.5 (study guide)

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Cooperative advertising

• retailer and manufacturer share the cost of
  promotion
• often 50-50 basis
• advertises both the and the .
• manufacturer may supply formats (p. 377)
• http//www.target.com.au
• needs to be carefully monitored to prevent abuses
• formal agreements (refer p. 378)

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Promotional allowances

• compensation for promotional .. provided by
  the intermediary
• about 10 - 15 of sales
• What is the aim?
• might not be used as anticipated
• needs close monitoring and research
• scanner data
• http//www.behaviorscan.com/public/us/prodserv/fac
  tsheet/us_fact_btadvertisingcross.htm

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Displays and selling aids

• point of sale (pos) or purchase (pop) displays
• http//www.posinflate.com.au
• http//www.displaydecorations.com.au
• For example
• end of aisles (gondola)
• dispensers, posters, cardboard cut outs,
  brochures etc.
• clutter v utility
• will it be ..?
• does it .. . for the retailer?

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In-store promotions

• events designed to . .. ..
  to the manufacturers products (p. 383).
• for example
• store visits
• demonstrations
• sausage sizzles
• http//davidjones.com.au

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Contests and incentives

• aim is to stimulate channel member sales ..
  (p. 384).
• What are some of the potential problems?

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Special promotional deals and merchandise
campaigns

• Range of promotions
• discounts
• special price deals
• two for one deals
• premiums
• coupons
• rebates
• Prizes
• What are some of the potential problems?

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Gaining channel member cooperation for
promotional programs

• promotional strategies should be part of an
  .. program of manufacturer support of
  channel member needs (p.372).
• . effort and cooperation in development and
  implementation
• planned approach

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Problems to consider

• What are the problems of having too many
  promotions?

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• Frequent trade discounts
• can result in purchasing
• only buy when a is offered
• purchase more than they need at the special
  price and then .. . to other retailers
• leads to .. demand, and thus increases
  .. costs

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Problems cont.

• Promotional allowances and discounts
• may .. by channel members but not .. to
  end-users
• may not result in greater support or cooperation

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So, what works???

• manufacturers sales force is the key
• provide .
• programs
• gather
• .. deals with . incentives
• strategies with a focus

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What works cont..

• Base promotion strategies on channel members
  needs
• How can we determine needs?
• Recognise that goal is inevitable,
  especially with .. more .. channel
  members
• pull and push strategies and recognise
  that pull strategies . on channel members

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Improving push promotional strategies

• improve .
• notice in ..
• coordinate with .
• Improve
• reduce paperwork

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• theme-related measures
• provide enough .. and flexibility to cater
  for specific . of channel members but
  maintain a .. theme
• product-related measures
• i.e. larger sizes to increase usage

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Kinder and gentler push promotional strategies

• Training programs
• Quota specification
• Missionary selling
• Trade shows

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Training programs

• aim is to improve the of channel members
  and gain cooperation for promotional programs
• must be based on channel members needs
• What type of training might be provided?

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Quota specification

• sales quotas
• .. for reaching and exceeding quotas
• How should the task of setting quotas be
  approached?

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Missionary selling

• . sales force provides for channel
  members
• role includes
• checking .. levels
• providing and information
• assisting with displays and merchandising
• . taking
• developing relationships goodwill
• What are the disadvantages?

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Trade shows

• exhibit products and present promotional messages
  to channel members and media
• http//www.aec.net.au/main.htm
• What would be the purpose?

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Summary

• Promotional strategy and mix
• Pull and push promotional strategies
• Basic push promotional strategies
• Gaining channel member cooperation for
  promotional programs
• Improving push promotional programs
• Kinder and gentler push promotional strategies