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*Consumer promotion (samples, coupons, cash refund offers, prices off, premiums, prizes, patronage rewards, free trials, warranties, tie-in promotions, cross-promotions, point-of-purchase displays, and demonstrations).
*Trade promotion (prices off, advertising and display allowances, and free goods).
*Business and sales-force promotion (trade shows and conventions, contests for sales reps, and specialty advertising).
Purpose of sales promotion
-Attract new triers or brand switchers
- Reward loyal customers
- Increase repurchase rates
Conclusion
Promotion is the marketing term used to describe all marketing communications activities and includes personal selling, sales promotion, public relations, direct marketing, trade fairs and exhibitions, advertising and sponsorship. Promotion needs to be precisely coordinated and integrated into the businesses global communications message, and this is called Integrated Marketing Communications (IMC). IMC integrates the message through the available channels to deliver a consistent and clear message about your company’s brands, products and services. Any movement away from the single message confuses the consumer and undermines the brand.
Control questions:
1. Can you give the definition of promotion?
2. Give more information about sales promotion.
3. What do you know about specific factors to consider when setting the advertising budget?
4. Give the information about developing and managing an advertising program.
5. What do you know about the communication process of promotion?
Literature
1. English for economists and managers: textbook/ O. V. Ulyanov, S. V. Grishin; yurginskiy technological Institute. – Tomsk: Publishing house of Tomsk Polytechnic University-theta, 2011. – 111 p.
2. Besanko D.A, Brauetugam R.R, Gibbs M.J Microeconomics,2011, Chicago
3. Griffiths A, Wall S.Economics for business and management,2011, England
4. Varian H.R. Intermediate microeconomics,2010, University of California at Berkeley
5. Boyd, W. Harper. Marketing Management.- Boston, 2010
Price
The purpose: Consider the main aspects of price, importance of pricing, pricing considerations, pricing strategies
Key words: price, profits, considerations, total cost, variable cost, elasticity, value, demand, product-line price
Questions:
13.1 The Importance of Price
13.2 Pricing Considerations
13.3 Pricing Strategies
The Importance of Price
The Importance of Price
-Price is a direct determinant of profits (or losses)
-Price indirectly affects costs (through quantity sold)
-Price determines the type of customer and competition the organization will attract
-Price affects the image of the brand
-A pricing error can nullify all other marketing mix activities
Relationship between Price and Profits
Profit = Total Revenue – Total Cost
Total Revenue = Price per Unit x Quantity Sold
Total Cost = Fixed Cost + Variable Cost
