Chapter 10 Direct Marketing & Sales Promotion

Direct marketing (characteristics, contents, advantages & disadvantages)- Direct mail
Direct- response advertisements delivered through mail
• 79% of consumers will act on direct mail immediately (Direct Marketing Association)
• Preferred channel for receiving marketing from local shops
• Allow brands to showcase products, services, quality or other promotional goal
Advantages
• Relatively low cost per piece produced
• Opportunity to target merchandise to clearly defined markets (mailing list)
Disadvantages
• Often considered to be junk mail
• A one-time mailing is unlikely to bring positive results
• Seen as negatively impacting the environment
Direct marketing (characteristics, contents, advantages & disadvantages)- Catalog
A catalog A published list of items for sale including descriptive information or illustrations
• Gain national exposure and distribute new products
• Help consumers visualize the fashion product
• Catalogue shopping (convenience, exclusive merchandise, special sizes
Direct marketing (characteristics, contents, advantages & disadvantages)- Email (web analytics)
Advantages
• Focus on a specific set of issues or interests
• Great way to create brand awareness, drive traffic to a website, and encourage sales.
Disadvantages
• Use web analytics to send emails based on the browsing history of an individual on a particular website
Direct marketing (characteristics, contents, advantages & disadvantages)- Text & multimedia messages
• Effective way to send coupons
• Companies can send video, audio, photos and other types of media over mobile devices.
Direct marketing (characteristics, contents, advantages & disadvantages)- Location based marketing (geo-targeting)
• Deliver location-based content.
• Software instantly send a special promotion and information about the nearest locations
• Effective method to engage consumers with a brand on a one-to-one basis.
Advantages
• Cost effective
• Targeted and personalized
• Interactive (able to engage the consumer)
• Time flexible and immediately available
Disadvantages
• Hard to obtain personal information (ex: phone number)
Definition of sales promotion
Activities that provide extra value or incentives to consumers, employees, or distributors to generate immediate sales
• Attract the consumer with a promise of reward
• Stimulate an immediate sale
• Needs to be relevant, useful, long-lasting
Roles of sales promotion
1. Eccourage consumers to buy a specific product or service
2. Ecourage consumers to purchase large quantities
3. Ecourage consumers to buy immediately (shortening the purchase cycle)
Sales promotion objectives (trial, defending current customers, encouraging repurchase,
attracting non-users, strengthening advertising and marketing efforts)
• Trial: Sampling, coupon
• Defending Current Consumers from Competition: Coupon, reward / loyalty program, refunds and rebates, gift-with- purchase, premiums
• Repurchase: Coupon, reward / loyalty program, refunds and rebates, gift-with- purchase, premiums
• Attract nonusers: Sampling, coupon, gift-with-purchase, premiums, deferred billing
• Strengthening Advertising and Marketing Efforts: Contests and sweepstakes, reward / loyalty program
Sales promotion objectives (trial, defending current customers, encouraging repurchase,
attracting non-users, strengthening advertising and marketing efforts)
• Defending Current Consumers from Competition: Coupon, reward / loyalty program, refunds and rebates, gift-with- purchase, premiums
Sales promotion objectives (trial, defending current customers, encouraging repurchase,
attracting non-users, strengthening advertising and marketing efforts)
• Repurchase: Coupon, reward / loyalty program, refunds and rebates, gift-with- purchase, premiums
Sales promotion objectives (trial, defending current customers, encouraging repurchase,
attracting non-users, strengthening advertising and marketing efforts)
• Attract nonusers: Sampling, coupon, gift-with-purchase, premiums, deferred billing
• Strengthening Advertising and Marketing Efforts: Contests and sweepstakes, reward / loyalty program
Sales promotion objectives (trial, defending current customers, encouraging repurchase,
attracting non-users, strengthening advertising and marketing efforts)
• Strengthening Advertising and Marketing Efforts: Contests and sweepstakes, reward / loyalty program
Criteria for incentives (e.g., relevant, useful, long-lasting)
Concepts, characteristics, and advantages & disadvantages of sales promotion
tactics/tools (e.g., sampling, coupon etc.)
Sales promotion objectives and the tactics that may be used to accomplish each objective
(use of each sales promotion tool) * in-class activity
Concept of customer loyalty
• Customer Loyalty (Dowling, 1997)
• Many customers want a relationship with the brands they buy
• A portion of these buyers are loyal to the core and buy only brand
• Loyal buyers are profitable group because there are heavy or frequent buyers
• It is possible to reinforce loyal customers and engage them to be even more loyal
Advantages and Disadvantages

• Sustained customer loyalty and less consideration by the consumer to shop at the competition
• Can be costly to if participating consumers do not increase their purchasing behavior with program membership.