related incentives, premiums, and loyalty programs
Coupons
Definition:
A price-saving incentive offered to consumers to stimulate quick purchase of a
specificed product
Experimental Marketing:
A form of marketing that creates an emotional connection with the
consumer in personality relevant and memorable ways
Contest
Definition:
A promotion that invovles awarding cash or merchandise prizes to consumers when
they purchase a specified product
Sweepstakes:
A chance promotion involving the give-away of products or services of value to
randomly selected participants
Game (instant-win promotion):
A promotional contest that includes a number of pre-seeded
winning tickets; instant-win tickets can be redeemed immediately
◦
Involves predeterminedm pre-seeded winning tickets in the overall fixed universe of tickets,
◦
Various instant-wins include
collect-and-wins
and small instant-wins combined with a
grand prize contest
◦
Example: Roll up and Win
◦
Certain rules and regulation for what information must be communicated to participants:
▪
The number of prizes and the value of each
▪
The odds of winning, and the value of each
▪
Whether a skill-testing question will be admistered
▪
Whether facismiles are acceptable win the case of a sweepstake
▪
How to enter, and what proof of purchase is required
▪
The contest's closing date
Rebates
Rebates:
A predetermined amount of money returned directly to cusomters by the manufacturer
after the purchase has been made
◦
Most common type of rebate is the
single-purchase refund,
which consumers receive a
portion of their money back for the purchase of a specified product
Slippage:
The situation of a consumer collecting lables in a promotion offer but failing to
follow through and request the refund
In a retail environment, rebate promotions boost sales since retailers can feature items at lower
prices than their manufacturer partners could otherwise afford
◦
They attract more customers and provide opportunities for additional sales
Rebate offers are best suited to products in the
mature stage
of the product life cycle
◦
At this stage in the life cycle, maintaining customer loyalty is critical
◦
A rebate promotion is not that expensive to implement
Premium Offers
Preimum:
An additional item given free, or greatly discounted, to induce purchase of the
primary brand
◦
The goal of the premium is to provide addied value to tempt consumers to buy
Offered to consumers in several ways:
◦
Mail-in
◦
Sending in proofs of purchase so the item can be delivered by mail
◦
In-pack or on-pack promotion, where the item is placed inside or attached to a package
◦
By an order form that is usually available at point of purchased
Bonus Pack:
The temporary offering of a large package size (e.g. 20 perrcent more) for the
same price as the regular size
◦
Example: “Buy one, get one free”
Loyalty Program
Loyalty Program (frequent buyer program):
