Special Studies Marketing

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WHAT IS SALES PROMOTION?

Sales promotion refers to many kinds of incentives and techniques directedtowards consumers and traders with the intention to produce immediate orshort-term sales effects.

DEFINITION

“Sales promotion includes incentive-offering and interest-creatingactivities which are generally short-term marketing events other than

advertising, personal selling, publicity and direct marketing.The purpose of sales promotion is to stimulate, motivate and influence

the purchase and other desired behavioral responses of the firm’scustomers.”

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Sales promotion offers a direct inducement to act by providing extra worth overand above what is built into the product at its normal price. These temporaryinducements are offered usually at a time and place where the buying decision ismade. Not only are sales promotions very common in the current competitivemarket conditions, they are increasing at a fast apace. These promotions aredirect inducements. In spite of the directness, sales promotions are fairlycomplicated and a rich tool of marketing with innumerable creative possibilitieslimited only by the imagination of promotion planners. Sales promotion is oftenreferred to by the names of ‘extra purchase value’ and ‘below-the-line selling’.

Used to achieve short-term sales

Sales promotion is a separate and distinct element in the promotion mix and isan important and powerful tool of marketing. The aim of sales promotion isgoal-oriented to achieve sales/marketing objectives which are short-term andimmediate. Generally, sales promotion is not used to generate long-term resultsor sales in the future, but rather to generate sales results now.Example: promotions mostly say “offer lasts till…” which is aimed at increased salestill that date. This would induce trials, and even the existing users wouldincrease consumption.

Becoming too common



Sales promotion has been traditionally viewed as a non-recurrent sellingactivity. However, this does not portray the present market conditions wherefrequent and repeated sales promotion programmes have become necessary tomaintain business in many product categories. The reality is that salespromotion has become an all too recurrent activity.

Today we find companies in almost all sectors offering some sort of a promotionscheme. These sectors range from automobiles to beverages, from financialservices to foods, from household durables to services, from household productsto business products, from personal care to textiles and apparel.Here are examples of each:

• Automobiles: Maruti Suzuki offered a 22-carat, 10gm Tanishq gold coin free andlots of other exciting prizes. Other prizes include 50 Rs. 50,000 Tanishq giftvouchers, 10 Rs. 1 lakh Tanishq gift vouchers and a grand bumper prize of 1kggold with every new Maruti 800 or Omni.

• Beverages: Taj Mahal tea offered prizes on filling the coupon present in the adand mailing it with a flip top of Taj Mahal tea 100, 250 or 500g pack. 1st prize:diamond set worth Rs. 1,00,000, 2nd prize: diamond set worth Rs. 50,000, 3rdprize: Taj Mahal watches.

• Financial services: Tata finance offered Free Tata Finance credit cards withevery car financed.

• Foods: Nestle offered Free 50g Johnson's baby soap with every 400g Cerelacpack.

• Household durables: Samsung offered a free book on Indian recipes and freecookery classes. Upto Rs. 2000 off & Borosil dishes worth Rs. 510, on buyingSamsung Microwave Ovens.

• Services: CMC Computer Education offered a set of 3 CDs of BrittanicaEncyclopedia worth Rs. 1995 free on enrolling for DST & eDAST.

• Household products: Kodak Express offered a Dil Chahta hai T-shirt free withany Kodak camera.

• Business products: Godrej offered prizes like a Ford Ikon car, Godrej airconditioners, Godrej auto clean washing machines and more on purchase ofPhotocopiers and Digital Multi-function products.

• Personal care: Fem had an offer of save Rs. 79 on buying a 1-litre pack of Femsoft gentle soap .



• Textiles and apparel: Bombay Dyeing had the Bombay Dyeing Lao DiamondPao Offer. 6990 diamonds to be won , on buying Bombay Dyeing products worthRs. 300 and scratching the card available.

The range of tools and techniques of sales promotion includes discount coupons,free samples, contests, games, premiums, sweepstakes, special pack allowances,trade fairs, cooperative advertising, continuity programmes, demonstrations,exchange offers and many others. Sales promotions add value to the product orservice which is extra and not built into the product or service. Not only dothese promotions supplement the effects of advertising, personal selling anddirect marketing but can also create a sense of urgency in customers to buy nowbecause the offer is available only for a limited period. This shows that salespromotions have a direct effect on the customers’ purchase behaviour.

Many types of sales promotion require participation of customers who areencouraged to take some action and invest their time and effort.

For example, contests and sweepstakes require some effort on the part of the customer;coupons require clipping, saving and redemption; for claiming the rebate/ refund, thecustomer is required to send the proof of purchase. In certain types of promotions suchas stock display contests or sales contests, the participation of dealers is required.

But sales promotions are not always short term. It would be reasonable to saythat promotions are reasonably short term because in many product categories,extra discounts continue on a regular basis. Likewise, some product brandsalways contain in-pack premium.

For example, each pack of Bharosa agarbatti contains either a stainless steel glass ora small bowl.

Filmfare magazine has a free pack of some product along with it almost all the time.This is a strategic decision of giving extra value to customers at a reasonable price, thusmaking it much more attractive to buy. This is possible because it has the strongfinancial backing of the Bennett & Coleman group.



Writing about sales promotion tools, Prof. Philip Kotler observes – “they have 3distinctive characteristics.”

1. Communication: they gain attention and usually provide informationthat may lead the customer to the product.

2. Incentive: they incorporate some concession, inducement, or contributionthat gives value to the consumer.

3. Invitation: they include a distinct invitation to engage in the transactionnow (offer valid till …or till stocks last)

Major users of sales promotions are marketers of soaps, detergents, toiletries,soft drinks, toothpastes, tea, coffee, footware, textiles, readymade garments,consumer durable goods, music systems, autos, televisions, washing machines,microwave ovens, refrigerators, magazines and many other household items. Infact the list of product categories using sales promotion is ever-increasing, nomatter what the product category, it could be staples, impulse goods, emergencygoods shopping goods, speciality goods, unsought goods, industrial products,or different types of services.Sales promotion is now established as an important and increasingly respectableelement of the marketing communication tools. Sales promotion expendituresare increasing dramatically, and economic recession is most likely to fuel thistrend further.



DIFFERENCE BETWEEN ADVERTISING AND SALES PROMOTION

Advertising Sales Promotions

By using a variety of persuasive appeals, itoffers reasons to buy a product or service.

Besides giving reasons in the form ofdifferent appeals, they offer incentive tothe consumers to buy the product orservice now.

Appeals are emotional or functional innature

Appeals are rational

Time-frame is long term Time frame is short termThe primary objective is to create anenduring brand image

To get sales quickly or to induce trial.

Indirect and subtle approach towardspersuading customers to buy a product orservice

Direct in approach to induce consumers tobuy a product or service immediately bytemporarily changing the existing price-value relationship of the product orservice.

But both advertising and sales promotions go hand in hand. Both are very essential toachieve success. Both are complementary to each other.

THE ADVANTAGE OF ‘ADVERTISING FOLLOWED BY PROMOTION’ OVER‘ONLY PROMOTION’

P P P P = promotion

Promotion alone

100



Advertising

A = advertising P = promotion

A P A P A P A

RELATIVE COMMUNICATION STRENGTHS OF ADVERTISING ANDPROMOTION

The width of arrows denotes the extent of effectivenessCFB = consumer franchise building

CFB

Promotion

CategoryNeed

BrandAwareness

BrandAttitude

Brand purchaseIntention

PurchaseFacilitation

Advertising then Promotionsales

150



REASONS FOR RAPID GROWTH OF SALES PROMOTION

There are a number of reasons that are favourable to the growth of salespromotion:

♦ Increasing Competition

The air of change is gaining momentum after the introduction of economicliberalisation.Due to increase in competition, companies are finding itincreasingly difficult to compete on quality. They are therefore resorting to moreand innovativemethods of sales promotion.

To break away from the clutter, Samsung introduced the ‘phod ke dekho’ and ‘phir sephod ke dekho’ offers, which helped increase sales.

♦ Customers Have Become More Price Sensitive

This increased price sensitivity is a direct result of rampant inflation. Economicrecession is likely to fuel this trend further, as consumers and dealers becomemore sensitive towards prices.

The case of Akai TV presents an interesting example. This television started introducingquite attractive deals, one after the other and gained a substantial share of the CTVmarket. Continuous promotions have affected the price perceptions of consumers acrossthe product category, and today the situation is such that customers in general look orwait for promotional deals on their preferred brands of CTV. They are not much movedby the advertising that might extol about the highly advanced features and quality ofmost brands. They usually consider buying CTVs on price cuts.

♦ Sales Promotions Generally Create An Immediate Positive Impact OnSales

Advertising, personal selling and other methods of promotion produce slowersales response compared to sales promotion. Sales promotions are mostly forshort duration, for a specified period, leading to a sense of urgency inconsumers to buy now. This creates an immediate positive impact on sales. Withcareful planning, it would not be difficult to measure the impact on salesvolume and profit, and see the consequences of running the promotion even onweekly or daily basis.Godrej offered a promotion scheme on its washing machines by cutting down the pricefrom Rs. 14,999 to Rs. 13,000. It also gave away a free VIP suitcase, and offered 0%interest loans. Sales went up by 70% shortly.



♦ Products have become more standardised

In many product categories, there is a proliferation of brands; many of them areline extensions and me-too brands. Most brands are being perceived byconsumers to be more or less similar within a given price range because of theinability of manufacturers to develop truly differentiated products. Under thesecircumstances, advertising messages are unable to strongly influence theconsumers’ perceptions and create brand franchise. As a result of theseperceptions of similarity among brands, marketers have no way but to competeon the basis of extra benefit offered through sales promotion. Competingcompanies struggle to capture market share by using every tool likely to bringsales success.

§ Standard Chartered had a scheme of Win Rs. 1 lakh on applying for a StandardChartered credit card .

§ HSBC came up with a scheme of Upto 25% off at select restaurants on using anHSBC credit card .

♦ Consumer Acceptance

As competition intensifies and promotions proliferate, consumers have learnt toearn the rewards of being smart shoppers. Over a period of time, they have alsolearnt that brands on promotion are not necessarily of lower quality.Woodland has a scheme of upto 50% off on Woodland shoes and apparel.This learning based on experience, gets transferred to other product categoriesas well. Consumers have learnt that promotions are being extended to manyproduct categories where such promotions were unheard of.

♦ Expectations Of Price Decrease

With the entry of many different brands of consumer durable products in thesame product category, consumers anticipate that the prices of durable goodswill come down. This encourages them to postpone their purchases. To speedup the purchase in this segment of consumers, sales promotions are an effectiveand attractive method. Consumers evaluate the incentives associated with theirpurchase decision and are motivated to act now, rather than wait for theanticipated decrease in price. The marketers should ensure that the extra benefitis attractive enough to create a sense of urgency in consumers.Samsung offers upto Rs. 8,000 off on exchanging an old refrigerator for a new Samsungrefrigerator.



♦ Advertising Has Become More Expensive And Less Effective

All the advertising media have become quite expensive. Audio-visual medium,which is considered as the most effective for short-duration ads, may cost inexcess of Rs. 1 lakh for a 10 second exposure during prime time. In many cases,consumers have reached a point of boredom due to excessive advertising on TV.Some consumers even consider advertising as an intrusion into their privacy,leading to zapping (surfing channels). Firms with small budgets cannot competewith big companies which spend huge sums of money on advertising. For thesesmall budget firms, sales promotion is a more cost-effective promotion methodto produce sales results. A firm that wants to introduce a personal care non-durable consumer product quickly and where the consumers’ personal usageexperience is more important, a sample drop can be quite effective.Gillette is offering a 4 gm. sachet of Gillette series shave gel concentrate free with every7 o clock super platinum razor.

♦ Trade Has Become More Powerful

Retailers and wholesalers have become powerful and find themselves in aposition to demand extra facilities from the companies. They do not hesitate toplay off one manufacturer against the other. In bigger cities, retailing hasbecome more sophisticated and competitive. For example, the shelf-space in anyretail outlet is limited. So every manufacturer wants the prime shelf-space in theretailer’s showroom. This created more demand for prime positions in the retailoutlets than what is available, and the retailer cannot oblige every company byallocating prime shelf-space. Companies introducing new products are oftenunder pressure to get a prominent shelf-position to make the productattractively visible. Channel members demand more incentives to get thedesired results. Manufacturers do not seem to have any alternatives but toconcede to their demands, keeping in view the competitive market conditions.§ Pepsi offers silver coins to their dealers stocking Pepsi cases during Diwali season.

And the promotions offer differs across dealers.§ Lalwani Dealers (Chembur) of consumer durables are offered tour schemes to Goa

or gold and cash incentives in order to push sales.

♦ Emphasis On Sales Volumes

Towards achieving the long-term profit goals, manufacturers try to attain highsales volume. Brand managers and product managers find themselves underpressure to achieve short-term sales results for the sake of their careers.Compared to any other promotional method, sales promotion is a more effectivemethod to generate short-term sales volume. Sales promotion has also become



more acceptable to top management and the incentives to management are tiedup with sales volumes. As competition intensifies, managers generally hesitateto devote more time and resources to building up their brands by sacrificing theshort-term results.

♦ Sales Promotions Maximise Profits

A number of economic theories conclude that a company can maximise profitsby using sales promotion. Such promotions can permit price discrimination byallowing the brand to compete in 2 or more different market segments. Salespromotion may allow a premium brand to compete with a lower tier brandamong price sensitive consumers. For example, a premium band of toilet soapmay be on promotion in some price sensitive markets, while in the remainingmarkets it is sold at its normal price.

♦ Introducing An Element Of Interest

There are a number of promotions which are often called interest promotions.Some of the more popular interest promotion techniques are samples, contests,and sweepstakes, free premiums and mail-in premiums. These promotionscreate an element of interest and excitement, and consumers enjoy these andresponse enthusiastically to such contests and sweepstakes, etc.Fevicol had recently launched a contest in which one had to choose 3 Fevicol ads whichthey considered the best, and then complete a slogan I like Fevicol ads because

♦ Impulse Buying Is Increasing

The number of marginal customers is increasing. Displays at the point ofpurchases lead to impulse buying by consumers, more so if the items on displayare not expensive. There is a popular saying in Hindi, “jo dikhta hai, voh biktahai.”This strategy is followed by soft drink majors like Pepsi and Coke on a large scale. Theypay huge sums of money to keep their products in front so that they are visible.These are also known as display promotions

♦ Sales Promotion Specialists Are Available

As a result of economic liberalisation, the number of management institutionshas increased. This has lead to the availability of specialists, who are not onlywell paid but can handle this specialised work more efficiently in the currentmarket conditions, where sales promotion has become more important.



♦ Excess Stocks

Because of increasing number of brands, it is difficult for manufacturers anddealers to anticipate future sales. This, at times, leads to excessive inventories,and the quickest way to clear that, is to go for sales promotion.Footwear companies like Bata, Woodland, etc regularly offer around 50% discount ontheir products.

ADVANTAGES OF SALES PROMOTION

Sales promotions have a significant effect on the behaviour of consumers andtrades people. Such promotions can bring in more profits for the manufacturersbecause they permit price discrimination.

♦ Price discrimination

Producers can introduce price discrimination through the use of salespromotions. They can charge different prices to different consumers and tradesegments depending on how sensitive each segment is to particular prices.Coupons, special sales events, clearance sales and discounts are examples toexplain the phenomenon.Often such price discrimination are offered in specific cities in the country,§ Bajaj Auto Ltd. started the scheme on 20th august 2001, where by if you buy a Bajaj

Spirit two-wheeler you get Rs.3000/- off, valid only in Ahmedabad.

Price concessions are also offered in trade fairs and exhibitions.§ The Grand Computer Carnival organised by HCL Infosystems Ltd. gives many offers

and discounts in their exhibitions.

§ The Strand Book Exhibition sells books at prices lower than the original.

Such price discriminating sales promotions that enable consumers and traders topay less in certain market area or stores usually bring in more contribution thanif one price is charged to all. Such price discrimination also held in adjusting tofluctuations in demand and supply situation without affecting any changes inthe list price.

♦ Effect on consumer behaviour

As sales promotions are mostly announced for a short period, customers mayfeel a sense of urgency and stop comparing the alternatives. They are persuadedto act now rather than later.



With every 500g pack of Tang, you get a free Tang glass. Offer valid only till stocks last.

Date Company/Brand

Offer Eligibility ApplicableIn

Periodof Offer

25August,2001

Pears Rs. 5 off.

On a 75g pack ofPears Oil ClearSoap andpresenting thecutting of the ad.

DelhiTill Sep15, 2001.

25August,2001

Sanyo Free Sanyo digital cameraVPC-SX560 worth Rs. 40,000.

With every LCDProjector.

Selectdealers only.

Till Sep30, 2001.

25August,2001

Kenstar Price off.On buying KenstarTumble Topwashing machine.

Select statesonly.

Limitedperiodonly.

25August,2001

MarutiSuzuki

A 22-carat, 10gm Tanishqgold coin free and lots of otherexciting prizes. Other prizesinclude 50 Rs. 50,000 Tanishqgift vouchers, 10 Rs. 1 lakhTanishq gift vouchers and agrand bumper prize of 1kggold.

With every newMaruti 800 orOmni.

Offer notvalid in thestate ofTamil Nadu.

Upto Sep15, 2001.

25August,2001

Apollo Travel bag free.On buying tworadials. Bangalore

Till Aug31, 2001or tillstockslast.

25August,2001

Apollo Personal stereo system free.On buying fourradials. Bangalore

Till Aug31, 2001or tillstockslast.

In our over communicated society and because of selective attention, it is notuncommon to ignore many advertisements. Sales promotion deals such asdiscounts, debates, coupons, premiums, etc also increased the attention gettingpower of advertisements and convey the advantages and benefits of the brand,including price information. By using promotions, marketers can reach the dealprone customers and encourage brand switching. Consumers, who buy onpromotion deals, consider themselves as intelligent and smart shoppers.

♦ Effect on trade behaviour

Short-term promotions present an opportunity and encourage dealers to forwardby. This forward buying ensures that retailers won’t to go out of stocks. Asdealers have more than the normal stocks, they think it advisable to advertise inlocal media, arranged displays and offer attractive promotion deals toconsumers. These actions help in increasing the store traffic.



§ Retailer promotion: Buy Cadbury s products worth Rs.3000/- and get any 30chocolates worth Rs.5 each free.

§ Buy a box of Munch and get 1 Munch free.

The aim is to speed up consumer purchasing from their outlets. Point ofpurchase displays attract customers, serve as reminders and lead to impulse orunplanned purchases. More customers get exposed faster to new productintroductions and retailers perceive less risk in stocking the new products. Somecustomers by new brand and if satisfied, may become loyal users and repeatpurchasers.

Regional Differences

The South is generally characterised by greater degree of going out and people tend todrink outside the house. The Tamilian, consumer in particular, is value oriented, rationaland looks up to film stars, while the Keralite is more international in his outlook. TheBangalorean is as Cosmopolitan as his Mumbai or Delhi counterpart."That sort of diversity, believes Coca-Cola, calls for a corresponding variety inpromotions. The place to attract is the retail zone. Coca-Cola recently launched apromotion called ' world of Coca-Cola' covering Chennai in Tamil Nadu and Bangaloreand Mysore in Karnataka. It was a value deal, aimed at the consumer disposed towardsglobal- style outings. The consumer pays Rs 20 along with a label of a 500 ml of PETbottle to get a card which entitles him to gifts and discounts at 29 outlets, including thoseof global chains such as TGI Friday and Baskin and Robbins this, in these cities. Aboutfour years ago, Pepsi had a similar promotion with its Pepcards. This, however was on anational level, while the Coca-Cola promotion is South based build retail level activitymatters more than it does in the North. The primary aim is to help the retail raisevolumes.



DISADVANTAGES OF SALES PROMOTIONS

While sales promotion is a powerful and effective method to produce immediateshort term positive results, it is not a cure for a bad product or bad advertising.In fact, a promotion is speed up the killing of a bad product. A consumer may bemotivated to try to new products because of the incentive but after this theproduct itself must take over.Pepsi Aha launched a sales promotion campaign for its launch, though the promotionwas effective, ineffective advertising and publicity led to the downfall of the brand.

♦ Increased price sensitivity

Frequently promoted brands in the product category, especially on the basis ofprice, make consumers and traders more price sensitive not only for thepromoted brands but for other brands as well in the same product category.Consumers wait for the promotion deals to be announced and then purchase theproduct. This is true even for brands where brand loyalty exists. Customerswait and time their purchases to coincide with promotional offers on theirpreferred brands.

The case of Akai TV presents an interesting example. This television started introducingquite attractive deals, one after the other and gained a substantial share of the CTVmarket. Continuous promotions have affected the price perceptions of consumers acrossthe product category, and today the situation is such that customers in general look orwait for promotional deals on their preferred brands of CTV. They are not much movedby the advertising that might extol about the highly advanced features and quality of mostbrands. They usually consider buying CTVs on promotion majorly based on price cuts.

♦ Quality image may become tarnished

If the promotions in a product category have been rare, or the product happensto be of high involvement category, the promotions could have a negative effectabout its quality image. Consumers may start suspecting that perhaps theproduct has not been selling well, the quality of the product is true compared tothe price or the product is likely to be discontinued because it has becomeoutdated.

Akai a well-known brand of colour television that remained perpetually on salespromotion. So after a point of time a good number of consumers started suspecting itsquality and almost no one is prepared to call it a high quality brand.

Because of competitive pressures, now almost all brands of colour televisionperiod market are available on one or the other promotional deal and consumerperceptions are that almost all the brands have same quality and performance in



a price range. Even a top-of-the-line brand like Sony having technological edge,has occasionally announced promotional deals because of competitive pressuresas promotions have become common in the category.

In the talcum powder category Dermicool started the sales promotion of buy one get twofree which diluted its image in the minds of the consumers.

♦ Dealers forward by and divert stocks

In case of deals for the trade, many dealers forward by, in excess of theirinventory requirements. This is particularly happens if a product is low bulk,much in demand and the inventory holding costs are favourably low. This istrue both for wholesalers as well as retailers. Forward buying of excessive stockson deals or quantity discounts can lead to diversion of some of the stocks in non-deal areas. Forward buying of excessive stocks on deals or quantity discountscan lead to diversion of some of the stocks in non- deal areas. Wholesalers andretailers do not hesitate in selling these excess stocks in non- deal areas on pricesthat are less than the list price, but keeping some reasonable margin forthemselves. This is likely to have a negative effect on price discrimination effortsof the company as dealers and those areas would not be buying even the normalrequirements from the company.

♦ Merchandising support from dealers is doubtful

One of the trade promotions tool is to offer promotional allowances to tradepeople to motivate them to provide merchandising support and to pass on somebenefit to consumers. This generally is the condition attached with suchpromotional allowances. In many cases, the dealers do not cooperate inproviding the merchandising support nor do they pass on any benefit toconsumers. The retailer might not be willing to give support because he does nothave the place, or the product does not sell much in his shop, or may be he thinksthe effort required is more than the commission/benefit derived.

♦ Short-term orientation

Sales promotions are generally for a short duration. This gives a boost to salesfor a short period. This short-term orientation may sometimes have negativeeffects on long-term future of the organization. Promotions mostly build short-term sales volume that is not maintained. Heavy use of sales promotion, incertain product categories, may be responsible for causing brand quality imagedilution.A dealer in second-hand cars had to close shop because he was able to attract customersonly during heavy promotions. The investment made on attracting customers was not



showing any continual returns.

Promotions do affect the behaviour of consumers, but not necessarily in apositive manner. David Ogilvy's remark about promotions is interesting, In 1981,United States manufacturers spent 60% more on promotion than on advertising anddistributed 1,024,000,000,000 coupons. Bloody fools.”

The argument given in favour is that companies should develop superiorproducts or services which are better than competitors and consumer should beconvinced through appropriate and focused advertising about the superiority ofthe product and its image.

This will result in lasting brand identities reflecting consumer values. Then therewill be no need to offer any extra benefits; only the lasting brand image will keepcustomers loyal to the brand.

PULL AND PUSH STRATEGIES

Sales promotion decisions are significantly affected by whether the companydecides to do to pull or push strategies to accomplish its objectives. Such adecision may require a little or a lot of cooperation from resellers. Therequirements to implement one strategy might be little more than to just stockthe product by the retailers. The other strategy may demand more participationfrom resellers such as the ability to explain to the consumers as to how a productworks.

In case of using a pull strategy, marketing efforts are directed at the ultimateconsumer and consumer promotions such as consumer contests andsweepstakes, rebates, coupons, free samples, consumer premiums, etc are used.If this strategy is also chosen to include advertising, there are large advertisingexpenditures. The objective of such promotional efforts would be to createsufficient consumer demand to pull the product through the channels, that is theconsumers are encouraged to demand the product from retailers who in tornplace orders with wholesaler or manufacturer to meet the consumer demand.



PULL

§ Bajaj Auto Ltd. offered a scheme of taking home a scooter at Rs 999 was a salespromotional offer communicated through effective advertising and was essentially apull strategy.

§ Taj MahalOn filling the coupon present in the ad and mailing it with a flip top of Taj Mahal tea100, 250 or 500g pack, the customer could win amazing prizes. Prizes included 1st prize:diamond set worth Rs. 1,00,000, 2nd prize: diamond set worth Rs. 50,000, 3rd prize: TajMahal watches. Offer was available in Punjab, Delhi, Chandigarh, Mumbai and Punefrom 24th august to 25th September.

This strategy may require little promotional efforts from the resellers except tostock input the product on shelves.

A pull strategy is appropriate when

• The product demand as high.• It is possible to differentiate the product on the basis of real or emotional

features,• Brand consumers show high degree of involvement in the product

purchase,• There is reasonably highly brand loyalty and consumers make brand

choice decision before they go to the store.

If a firm decides to use push strategy, its efforts are directed at resellers and themanufacturer becomes very dependent on their personal selling abilities andefforts. The promotional efforts are focused at pushing the product through the

Manufacturer

Wholesaler

Retailer

Consumer

Flow ofpromotion:sales promotionand advertisingFlow of demand



distribution channels; the resellers may be required to display, demonstrate andoffer discounts, to sell the product. The communication to resellers is generallythrough trade circulars or the sales force.

PUSH

Push strategies generally appropriate for product categories where there is lowbrand loyalty and many acceptable substitutes are available in the market. Itmay also be suitable for relatively new products or when the brand choice isoften made in response to displays in the stores, the product purchase isunplanned or on impulse and the consumer is familiar and has reasonablyadequate knowledge about the product. Manufacturers, who cannot afford toengage in sustained mass advertising, often use push strategy and offer effectiveincentives to dealers.

Retailer promotion: Buy Cadbury’s products worth Rs.3000/- and get any 30 chocolatesworth Rs.5 each free.Through this offer the company is pushing its product to the retailers and now that theretailer has enough incentive the retailer stocks more and thus it becomes essential for theretailer to push the product to the consumers.

Manufacturer

Wholesaler

Retailer

Consumer

Flow of promotion: tradedeals advertising,personal selling.Flow of

demand



PULL AND PUSH

Pull promotions(Manufacturer to

consumer)

Push promotions(Offered to trade)

Push promotions(Offered by

retailer)

SamplingCouponsPrice packsRebatesContinuity programsContestsSweepstakesTie-in promotionFinancing incentivesSpecial eventsPremiumsBonus packsExchange offers

DiscountsDisplay allowanceAdvertisingallowanceFree goodsContestsTrade couponsQuantity discounts

Price cutFree goodsPremiumsDisplaysFeature advertisingQuantity discountClearance sale

Manufacturer

Wholesaler

Retailer

Consumer

Flow ofpromotion mix

Flow ofdemand



"Product life cycle and pull or push strategies"

It is quite important for brand managers to analyze and identify the stage of aparticular brand in its life cycle before deciding about using sales promotion.During the stage of product introductions, a product requires different salespromotional tactics.Likewise, during the product growth stage, its maturity and the decline stages,the sales promotion tactics required are likely to be quite different. Promotionalstrategies are also likely to be affected for different non-durable and durableproducts. Also important in the development of promotional strategy would bethe target audience is towards whom the sales promotional messages would bedirected.

♦ Introduction stage

When the product is being introduced, the major objective is to increase the trialrate and distribution of the product. For increasing trial sampling, coupons,demonstration which are all pull promotions, can be used. To make the productavailable in distribution channels, it may become necessary to use some kind ofincentive scheme for the resellers to encourage them and minimise their riskassociating stalking a new product. Manufacturers can offer display allowancesto resellers to make the product highly visible. There could be liberal guaranteesto take back the stocks, if unsold, to reassure the trader. These are all pushpromotions. For most new products, it would be difficult to be successfulwithout pull promotions. In fact when new products are introduced, much moreemphasis is given to pull rather than push promotions.

§ Fair and lovely is introducing the Fair &Lovely dark circle remover crème by havingan introductory offer Rs10 off which will be available through the coupons that aredistributed with newspapers like the Times of India.

§ Maggie Chinese noodles was launched in February 2002Objective- to launch Maggi Chinese noodles, create awareness amongst the targetaudience and induce trialsCity-DelhiStrategy- an LCV attractively covered with Maggi Chinese noodles branding wasused for the road show. Dragon cut outs and a sales person dressed as a Chinese chefwere used to highlight the Chinese aspect. Activities around it included quizzes andfun games like make the longest noodle out of plasticine. Sample packs of MaggiChinese Noodle, Maggi/Nestle T-shirts and caps were given out as prizes. This



activity was conducted over a period of 30 days in major shopping malls, schools,colleges and hotspots in the city. The response of this was overwhelming.

♦ Growth stage

In this stage, the dominant objectives are to expand the market for increasing thenumber of new customers who would try the product for the first time and toencourage the repeat purchase by those who have already tried the product.Another important objective is to expand or at least maintain the distribution.For increasing trial, pull promotions are appropriate however as the trial rateincreases free samples become quite an expensive proposition. To encouragerepeat purchase by consumers, in pack or on-pack coupons can be used.

Samsung had launched the Phod Ke Dekho offer last Diwali between October 15 andNovember 20, 2001, to optimise sales of its consumer electronics and home applianceproducts during the festival season, which resulted in tremendous sales. Samsung's salesduring Diwali grew by over 28 % over last year's corresponding period and closed theperiod with sales of Rs 275 crore. While Samsung's CTV sales grew by 46%, refrigeratorsales grew by 25% and microwave ovens by 52%.Due to the success of this promotional scheme the Samsung "Phir Se Phod ke Dekho"Consumer Offer, valid between October 1~November 15, 2002 had been reintroduced bythe company to optimize sales.

Promotion:

The Phir Se Phod ke Dekho Consumer Promotion has all the excitement packaged in acoconut which the customer handpicks on purchase of a Samsung product One SureshotSilver Pure Coin and Exciting gifts for Lucky winners. In addition to the Silver coin, eachcoconut has a Cricket bat shaped key chain which has the gift engraved on the Bat, if thecustomer has won a Gift. Gifts worth Rs. 15 Crores are being given to customers as partof the Promotion Tickets to South Africa for World Cup 2003; Samsung products likeVCD Players, CD Yepp players, Vacuum cleaners, Mobile Phones, DVD Players, Keyphones; Anil Kumble memorabilia and VCD set, Braun Hand Blender and Adidas TeamT Shirt. In addition to participating at the Samsung Phir Se Phod ke Dekho ConsumerOffer, the customers of select Samsung hi-end Consumer Electronics products are alsoentitled to a Gift Voucher worth Rs.2500 from Tanishq, which can be redeemed at anyTanishq outlet. The Company is spending Rs. 20 Crores on this Promotion.

This would also help in converting those customers who have already tried theproduct into regular users of the product. Another tool of sales promotion thatcan be used is to offer bonus packs containing additional quantity at the sameprice as an incentive to encourage repeat purchase. To expand the distribution,push promotions such as different types of discounts, free goods that increasethe profitability of the trade, can be used.



♦ Maturity stage

When the product is in maturity stage, many similar brands are available tocustomers. Due to price discounts or other extra benefits, consumers oftenswitched brands. This phenomenon of brand switching is more common if theproduct category happens to be one of low involvement. The sales promotionalstrategy in this stage can focus on attracting maximum number of brandswitchers, reward and reinforce the loyalty of regular users and use more ofpush promotions to build inventories with resellers. Many tools of salespromotion such as premiums, price discounts, extra goods, displays, dealercontests, feature advertising become important.

§ CMC Computer EducationOn enrolling for DST & eDAST. A set of 3 CDs of Brittanica Encyclopedia worthRs.1995 free.

§ Indian Airlines frequent flyers programme where you get discounts on frequentvisits, get hotel stays free, credit facility etc.

Generally a combination of pull and push promotions prove more effectiveduring maturity stage of a product life cycle. The market share of the brand is animportant factor in gaining the support of resellers.

♦ Decline stage

Survival of the brand often becomes more important during decline stage.Another important objective is to maintain distribution. Sales promotions thathelp in generating sales volume become quite important. Resellers, in general,are not a tall enthusiastic about declining brands and for this reason we do notshow any kind of interest in promoting them. Because of this negative factor,manufacturers use pull promotions. In many cases this becomes a game ofendurance for marketers.

Bombay DyeingThe Bombay Dyeing Lao Diamond Pao OfferOn buying Bombay Dyeing products worth Rs. 300 and scratching the card available,you would be eligible for a prize. There were 6990 diamonds to be won.



INITIATORS AND AUDIENCES FOR PROMOTION

There are different groups who might be a target of sales promotion; consumers, tradeand the sales force. Sales promotions originating from manufacturers may be directed atconsumers, resellers or both. Simultaneously, the manufacturer may also have apromotion programme for its own sales force. Sales promotions may also originate fromretailers and are aimed at customers, though their objectives are different form those of

= Initiator of promotion

= Audience for promotion

(Consumer promotion)

Manufacturer

Distributor

(retail promotion)

(Sales force promotion)

Sales force

Consumer

(Trade promotion)



the manufacturers. Their purpose generally is to increase store traffic rather than sell aparticular brand as may be the case with manufacturer-initiated promotion.

TECHNIQUES OF SALES PROMOTIONS

Consumer market salespromotions

Trade sales promotions Sales force salespromotions

Price discounts Off-Invoice Allowance Sales contests

Price pack deals Buying allowance Incentives

Rebates/refunds Display and advertisingallowance

Awards and prizes

Continuity programs Buy back allowance Premiums (gifts)

Coupons Bill back allowance Sales meetings

Samples Count and recountallowance

Training

Contests and sweepstakes Slotting allowance Sales manuals etc.

Premiums and advertisingspecialties

Merchandise allowance

Free trials POP displays

Brand placement Cash rebate

Event sponsorship Free goods

Product warranties Trade coupons

Exchange offers Dealer listing

Internet promotions Dealer loaders

Low interest financing Sales contests

Free service camps SPIFFS (push money)

Incentives

Sales training programs

Trade shows



CONSUMER SALES PROMOTIONS

Sales promotions directed at the end-user, whether by the manufacturer or theretailer, are called consumer sales promotions. Manufacturer announcedpromotions to consumers are based on ‘pull’ strategy of the manufacturer andretailer announced promotions to consumers constitute ‘push’ strategy of theretailer.

Objectives of consumer market sales promotions

The following basic objectives can be pursued with sales promotions in theconsumer market.

♦ Stimulate trial purchase

When a firm wants to attract new users sales promotions tools can reduce theconsumer’s risk of trying something new. A reduced price or offer of a rebatemay stimulate trail purchase.§ When Dove was launched in the market, people had a certain reservation against the

product. Why?There were two reasons:a. Price factor. Most housewives found Dove to be pretty steep and thus consumptionwas restrained.b. Secondly, the rumours of one of its ingredients being animal fat.HLL began a sales promotion campaign: Get Dove soap free with a kilo of SurfExcel. With this promotion tactic, HLL got the opportunity of converting non-usersof Dove to users. At the same time changing attitudes of other detergent users byconverting them to Surf users.

§ Whisper, right from the time it launched its first product has been doing a lot of salespromotions to stimulate trial purchase. The main tool used by it is sampling. Theyhave done door-to-door sampling, sampling through schools, newspapers, etc. evennow after so many years of its launch it does sampling because of the new target basethat gets added every year.

§ Pantene when it was launched did a lot of sampling, to stimulate trail purchase. Theirefforts have surely shown results, with Pantene being one of the top selling brands inIndia today.

♦ Stimulate repeat purchasesIn-package coupons good for the next purchase, or the accumulation of pointswith repeat purchases, can keep consumers loyal to a particular brand.



The most prominent frequency programs are found in the airline industry wherecompetitors try to retain their most lucrative costumers by enrolling them forvarious perks such as frequent flyers can earn free travel, hotel stays, gifts etc.

§ McDonald s India have targeted a lot at the kids. To keep them coming in again andagain they introduced the happy meal concept where they used to give away differenttoys every week. And they advertised about it saying collect your entire set of toys.This concept really worked and has shown a tremendous increase in the sales and ispresently an integral part of their marketing strategy.

§ Jet PrivilegeJet privilege is a rewarding and customer friendly frequent flyer programme in thecountry as a jet privilege member one can earn JP miles not only on jet airways but alsofrom many other programme partners of the programme.

♦ Stimulate larger purchases

Price reductions or two-for-one sales can motivate consumers to stock up on abrand, thus allowing firms to reduce inventory or increase cash flow.

Many soaps brands are doing sales promotions to stimulate larger purchases. Whenpeople generally come to buy soaps, and see the offers like,Fairglow, buy 3 get 1 free,Lux buy 3 get 1 free,Rexona buy 3 get 1 free,Godrej Nikhar buy 3 get 1 free,Dove get 3 at a reduced price, buy 2 get Lakme fairness cream free,they generally end up buying more then what they intended to. They often stock upproducts at the time of sales promotions.

♦ Introduce a new brand

Because sales promotions can attract attention and motivate trial purchase, it iscommonly used for new brand introductions.

Fairglow has effectively used sales promotions to introduce its brand, by doing a lot ofsales promotions like the buy 3 get 1 free, also Fairglow free with Good Knight, withother HLL products.

♦ Combat or disrupt competitors strategies



Because sales promotions often motivate consumers to buy in large quantities ortry new brands, they can be used to disrupt competitors marketing strategies. If afirm knows that one of its competitors is launching a new brand or initiating anew advertising campaign, a well-timed sales promotions offering deepdiscounts or extra quantity can disrupt the competitor strategy. Add to theoriginal discount an in-package coupon for future purchases, and a marketer canseverely compromise competitor’s efforts.

§ PepsiPromotion: Hero No.1Objective: The promotion wa sales promotions a part of Pepsi s efforts to counterCoke sales promotions aggressive marketing in thses citiesCity: Kanpur and lucknowStrategy: The event spread over a seven-day activity right after the dance mastipromotions. A mobile float with dancers, performers, and still walkers traveled thestreets of Kanpur and Lucknow. The entertainment was based around the theme of HeroNo.1

§ When Godrej did sales promotions to increase it washing machine sales Samsung toprotect its market also introduced sales promotions.

Godrej gave a rebate offer and a free VIP suitcase. So Samsung also introduced therebate offer and gave a camera free.

♦ Contribute to Integrated Marketing Communications

In conjunction with advertising, direct marketing, public relations and otherprograms being carried out by a firm, sales promotions can add yet another typeof communication to the mix. Sales promotions suggest an additional value, withprice reductions, premiums, or a chance to win a prize. This is an additional anddifferent message within the overall communication effort.

Techniques of consumer sales promotions

♦ Price discounts or price-off deals.

Price deals are probably the most commonly used promotional techniques. Aprice deal for a customer means a reduction in the price of the promoted productand the consumer saves money on purchase.

Such a deal is designed to:

§ Stimulate customers to try a new product,§ To encourage new users to try an existing product



§ To encourage customers to continue product patronage,§ Increase purchase quantity,§ Purchase multiple units and§ Accelerate usage rate.

§ All Out mosquito coils have a bumper offer, 30 hi-power mats originally priced atRs.45 are available at Rs.27 only.Objective: To create brand preference.It is very important to have sales promotions in the mosquito coils segment. This isbecause in mosquito coils there is hardly any product differentiation and so itbecomes necessary to give the consumer a reason to buy. Hence sales promotionsplay an important role in increasing your product sales.

§ Colgate fresh energy ice blue gel (Colgate India) 50 gm pack, Rs. 5.50 off on normalprice, now available at Rs. 12.50 only.

§ Lux soaps (HLL) 125gm pack, Rs.5 off.Objective: To increase sales and to encourage new users.

§ Duracell plus, special offer a pack 2 batteries, Rs.20 off on MRP.

§ Bajaj started the scheme on 20th august 2001, where by if you buy a Bajaj Spirit two-wheeler you get Rs.3000/- off, valid only in Ahmedabad.

§ AptechOn the complete ACCP 2002 course, save upto Rs.33,600/-

§ WoodlandOn woodland shoes and apparels get upto 50% off.

Price discounts are communicated through POP advertising, window displays,sales people, advertising in newspapers, magazines and TV ads.

Determining the quantum of discount depends on the consumer’s priceperceptions and may be difficult to decide.

Such promotions work very well in gaining the attention of consumers,particularly at the point of purchase among similar brands and may alsoencourage unplanned or impulse buying. If there are three different models of aproduct and because of the discount offered the price of the higher end model isappears, not too high to the consumer as compared to the lesser priced model,then the consumer may buy the higher end model.

Titan watchesObjective: make the high end product seen cheaper.



Branded watches are a high value product. Titan watches are expensive compared tomany other branded watches available. Hence in case a sales promotion offer like somerupees off is available on the watch, the consumer finds the high priced high qualityproduct cheaper and so buys that instead of the cheaper one.

The main advantage of this tool is that it has a very Strong consumer responseSuch discounts offer immediate value and strong consumer response.The Flexibility and convenience of implementation is another advantage. Priceoffers are extremely flexible in the sense that the producer has total control onthe number of units being promoted and the market area in which the offer willbe given. If different packs of the same brand are available, the marketer canchoose the one size that is not selling well.

A discount offer may rapidly lose its advantage if competitors announce asimilar offer. In fact, competitors are very likely to retaliate leading to the dangerof triggering a promotion wall in which no one benefits except the consumer.

Such discounts are short term and are unlikely to produce any long-term gainsbecause the incentive is to purchase now by creating sense of urgency. When thediscount is withdrawn the sales may fall below the level of pre-promotionperiod. And in the long run the sales would return to pre-promotion periodlevel.

♦ Price pack deals

Price pack deals are also called value packs.They can take any of the two forms: one is bonus pack and banded pack.In case of a bonus pack, an additional quantity of the same product is offered freewhen the standard pack size of the product is purchased at the regular price.

§ Godrej colour gloss triple action shampoo, offers 20% extra free. 100ml +20ml.

§ Sunsilk shampoo (HLL) 400ml bottle gives 33% more free.

§ New Ever youth lemon face wash, by Cadilla Health care Ltd. Offers 20% Extra with60 ml 12 ml free.

§ Lotus Herbal Ltd s Fresh Apricot scrub, 25% extra, communicated as 7.5 ounces at6 ounce Price.

§ Dettol shaving cream (Reckitt Benckiser (India) ltd.) get 40% extra free.

§ Bisleri 20% extra free



A variation of this offer is when the marketer develops special packs of theproduct containing more quantity but the price is proportionately low. This is amethod to “load” the consumer up with the product. This technique is often usedto introduce a new large size of the product or to encourage continued usage andalso to increase consumption.The offer is termed as “banded pack” when 2 or more units of the products aresold at a reduced price compared to the regular price.

Pepsodent toothpaste special pack a 150gm toothpaste + a 100gm toothpaste and aG.I.Joe international character, all in 1 pack at a low price of just Rs., which savesRs.81/-

Another variation of this technique is “buy 1 get 1 free” or some similar offer, itcould be “same for less” or “more for the same.”

§ Fairglow buy 3 get 1 free,§ Wipro baby soft baby oil 50 ml pack buy 1 get 1 free,§ Lux buy 3 get 1 free,§ Dove get 3 at a reduced price§ Akai offered a 14" colour television on the purchase of a 21" colour TV.

The main advantage of this tool is that extra product may encourage increasedusage and help sustain the habit. Also among other similar brands, a bonus packstands out at the point of sale.

♦ Refunds And Rebates

Refund is the repayment of total money paid for purchase, while the rebaterepresents repayment of only part of the money paid for the purchase. Refundoffers seems to work very well in guaranteeing the trial of a product or servicesince there is no risk involved for the customer because of the promise of totalrefund of the purchase amount.Refunds and Rebates play an important role in the consumer durable segmentbecause the product price is reduced to a great extent because of the rebate offer.

§ WhisperObjective: To increase product trialsAfter having launched it new product whisper ultra thin, confident about the productquality and confident about offering the promised product, to increase its trail andusage has started the money back offer.The money back offer is a very effective tool in making the consumer try the productin 2 ways, firstly because the consumer feels that the company will launch such a



scheme only if it is possible for it to offer such quality and so is become confident thatthe product will be satisfactory.And secondly he is more willing to try because if he does not like the product he hasthe option to get his money back.

§ Gillette announced a refund offer where a customer was required to buy a pack of7 o clock P II for Rs. 55.50, on returning the empty pack, the customer gets Rs.55.50 off on Gillette Sensor Excel.

§ A computer magazine, Chip, offered a refund of Rs. 350 on sending a one-yearsubscription, which the customer can use to purchase special issues of themagazine.

♦ Coupon

A coupon entitles a buyer to a designated reduction in price for a product orservice. Coupons are the oldest and most widely used form of sales promotions.Coupons bear an expiry date and cannot be redeemed after the cut off date.

Coupons can be of 3 types:

• Direct to the consumer• Media distributed• Product distributed.

The main Advantages of coupons are:

• Encourage brand switching• Stimulate trial for a product• Take off the attention from price

§ Wipro Shikakai had a coupon in newspapers, which anyone could redeem at thenearest retail store, where he could buy one and get one free.

§ Fair and lovely dark circle removal cream to create more product trials has couponsin the newspapers and magazines which avail you of Rs.10/- off on a 40 gm pack.

§ Ponds when it launched its face wash, the market scenario was such that manybrands where coming up with face washes and everyone positioned it as soap-free, there was not much differentiation and hence ponds intelligently did a salespromotion where it had coupons in newspapers and magazines which gave thecustomer the offer of Rs.5 off on a 50 gm pack. It also gave trail packs free withits other products.



§ Pears oil clear soap, redeem the coupon at a retail store and buy a 75gm soap getRs.5 off

♦ Contests And Sweepstakes

Contests and sweepstakes can draw attention to a brand like no other salespromotions technique.A contest has consumers compete for prizes based on skill or ability. Winners ina contest are determined by a panel of judges or based on which contestantcomes closest to a predetermined criterion for the contest. Contests tend to besomewhat expensive to administer because each entry must be judged againstwinning criteria.

Contests were very often used earlier where people has to write slogans, poems,stories etc. generally “I like the product because …” and the best ones wonprizes. But off lately, contests are becoming less and sweepstakes increasing.People are more willing to play on luck rather than participate by showing theirabilities.

§ Nokia India Pvt. ltd.Promotion: Nokia Sms Challenge-august, 2001Objective: To establish nokia phones as the most SMS-friendly phones in the marketCity: DelhiStrategy: Tie-ups with 15 premier outlets preceded and asked them to SMS a pre-decidedline to a particular number, the time taken by a participant was the determinant of thecontest, the person taking the shortest tome would be gifted a Nokia 3310 phone.

§ Asian paintsAsian paints had launched a cricket promo. One had to walk into a Colour World outletand pick out the shade of blue that the Indian cricket team would be wearing to theworld cup. Should lady luck smile, that individual would be among the 10 to win a freetrip to England.What was there in it for Asian paints?People would be exposed to the number of shades available.

§ Taj MahalOn filling the coupon present in the ad and mailing it with a flip top of Taj Mahal tea100, 250 or 500g pack, one could win prizes. Prizes included 1st prize: diamond setworth Rs. 1,00,000, 2nd prize: diamond set worth Rs. 50,000, 3rd prize: Taj Mahalwatches. The offer was available in Punjab, Delhi, Chandigarh, Mumbai and Pune, from24th august to 25th September.

A sweepstake is a promotion in which winners are determined purely bychance.



Consumers need only to enter their names in the sweepstakes as a criterion forwinning. Some popular types of sweepstakes also use “scratch-off cards”.

Contests and sweepstakes often create excitement and generate interest for abrand, but the problems of administering these promotions are substantial.One problem is that the game itself may become the consumer’s primary focus,while the brand becomes secondary. The technique thus fails to build long-termaffinity for the brand.

§ Britannia khao world cup jao campaign has taken the market by a swing.Under the offer you collect points available on Britannia biscuit packets and exchange100 points for a scratch card, which has various gifts and the 100 world cup tickets. Theoffer was actually introduced during the last world cup and had shown phenomenalresults. Sale increased tremendously; there was an increase in the sales by 25%, claimsthe company. So it is being done this year too. This year too the contest is showing goodresults.

§ LakmeObejctive: To increase salesCity: DelhiStrategy: Scratch a card contest in all Lakme counters of different malls, markets, andshops was organized. Consumers who bought Rs.150/- worth or more of products weregiven a card and ion scratching the colored bar and assortment of gifts can be won.

§ Lipton Tazza.Promotion: Lipton Tazza Jo chaho woh paao contest-February 2002, July 2002Objective: to create awareness and build consumer loyalty to Lipton tazza teaCity: all over IndiaStrategy: With every purchase of Tazza tea, consumers got exciting prizes and also hadthe opportunity to win diamond pendants. The bumper prize entailed making a wish listfrom TVs, Refrigerators, jewelry, computers any and everything they wished for would bemade available to them.

§ Even TVS Victor and Boost are having scratch cards and giving away world cuptickets.

§ Maruti SuzukiWith every new Maruti 800 or Omni. The offer was on between 25th august to 15th

September. A 22-carat, 10gm Tanishq gold coin free and lots of other prizes. Other prizesincluded 50 Rs 50,000 Tanishq gift vouchers, 10 Rs.1 lakh Tanishq gift vouchers and agrand bumper prize of 1kg gold.

§ Vim gold bar offer with every Vim bar you get a scratch card, which has manyprizes including gold bars people are showing interest in this offer too.



§ Bombay Dyeing- Bombay Dyeing had the Bombay Dyeing Lao Diamond Pao Offer.6990 diamonds to be won on buying Bombay Dyeing products worth Rs. 300 andscratching the card available.

§ CintholBuy Cinthol International Perfumed Deodorant and through the scratch card:1 Ist prize- Win a trip for 2 to Australia5 IInd prizes - Panasonic 29" colour television set.150 IIIrd Prizes - Braun hand blender.Guaranteed minimum prize Rs 5/- OFF.

Contests-cum-sweepstakes:

Elle 18Promotion: Elle 18 valentine s day promotion, feb 2002Objective: to use valentines s day platform to communicate with th etarget audience ofElle 18City: Delhi, Mumbai, Banglore, Chnadigarh, Pune.Strategy: Upon the purchase of Elle 18 products worth a certain amount, a scratch-cardwas given out. this could entitle the person to a number of gifts and hampers. Thehighlight of this was the Cinderella Activity which invited those customers who hadbought products worth a pre-decided amount to try put a glass slipper. The lucky few,whose feet fit, were awarded dinner dates.

♦ Sampling

Getting consumers to simply try a brand can have a powerful effect on futuredecision-making. Sampling is a sales promotion technique designed to provide aconsumer with an opportunity to use a brand on a trial basis with little or norisk. Saying that sampling is a popular technique is an understatement. Samplingis particularly useful for new products, but should not be reserved for newproducts alone. It can be used successfully for established brands with weakmarket share in specific geographic areas.

Techniques used in sampling:

• In-store sampling

Lakme has in-store trail products. Since it in the cosmetics market it is very essential toprovide samples, many stores in Mumbai from time to time have Lakme sampling offers.Where they allow you to try the product and then buy it.

• Door-to-Door sampling



Whisper have done door-to-door sampling, sampling through schools, newspapers, etc.even now after so many years of its launch it does sampling because of the new targetbase that gets added every year.

Pantene also does door to door sampling.

• Newspaper sampling

Again Whisper and Pantene have done sampling through the newspapers.

• On-package sampling

Fair glow, a lot of free Fairglow soaps were available with many other products,especially other HLL products.

• Mobile sampling

Many road shows and mobile vans distribute free products or offers.Free Movie tickets, disco passes, pens…are often distributed.

Lehar KurkurePromotion: Smapling excersieObjective: to create awarness and initiate the consumer; sales promotions taste buds.City: 18 citiesStrategy: Extensive sampling for kurkure was undertaken in 18 cities in the northwherein a branded float visited various markets and sample packs of the product weredistributed to the target audience. Over 2 lakh packs of kurkure were distributed assamples.

♦ Trial offers

Trial offers have the same goal as sampling – to induce consumer trial use of abrand- but they are used for more expensive items.Ex: exercise equipment, appliances, consumer electronics, etc. the expense to thefirm of course can be formidable. Segments chosen for this sales promotiontechnique must have high sales potential.

♦ Premiums and advertising specialties

Premiums

They are items offered free or at a reduced price, with, the purchase of anotheritem. Many firms offer a related product free.



There are 2 options available for the use of premiums:

1. A free premium provides consumers with an item at no cost, the item isincluded in the package of the purchase item.

2. A self-liquidating premium requires a consumer to pay most of the cost ofthe item received as a premium. In this promotion offer the consumer isrequired to send a specified sum of money along with a proof of purchaseto claim the premium.

Premiums have become very common today. Many companies are offering lotsand lots of premiums. The main advantage of Premiums is that they offer notonly that one product but also another product, which may influence thecustomer, a lot to buy the product. Especially if the other product is worth it.Also new products are given free with established brands to stimulate trial of thenew brand.

§ When attacked by Cavincare of Fairever fame, HLL adopted a defensive strategy bygiving away one more Fair and Lovely free with every purchase of it (BOGOF). Thisis one of the many ways by which a marketer can piggyback on the brand s standingin the market.

§ Ponds buy Ponds cold cream 100ml and get a ponds body lotion 50ml pack free.Buy Good Knight expert refill pack and get 3 Nyle shampoo sachets free.

§ Pepsodent toothpaste buy 100gm and get 4 Clinic Plus sachets free.

§ With 2 Dove soaps get a Lakme Fair Perfect cream free.

§ Colgate toothpaste 200gm gives 500 ml Pepsi free

§ With every car financed, Tata Finance gave Tata finance credit card free, applicableonly in Calcutta.

§ On using HSBC credit card you get around 25%off at select restaurants.

§ Buy Nivea cream (J. L. Morison (India) ltd.) 50ml and get Nivea soap worth Rs.22free.

§ Buy Nivea body pure talc and get Colgate fresh energy gel toothpaste free.

§ Buy Nestle Cerelac 400gm get Johnson s baby soap free.

§ Buy Nescafe classic 50gm and get Nestle Kitkat free (36gm)

§ Buy Servo engine oil and get Coca-Cola or Mazza free.



§ VLCC With every spot reduction package for tummy/ thighs/ hips, free 5 kgs.weight loss.

§ Excalibur, on buying any two Excalibur shirts or trousers, a wristwatch worthRs.350 free.

Advertising specialties

Popular advertising specialties are caps, t-shirts, toys, mugs, mouse pads, pens,calendars, etc.Advertising specialties have 3 key elements:A message placed on a useful icon, and given to consumers with no obligation.

§ Pepsodent toothpaste 100gm pack get free dental insurance worth Rs.1000, this is avery effective strategy because it is giving you re the guarantee that nothing canhappen to your teeth. The Rs.1000 insurance speaks a lot for its brand and its productthrust.

§ Buy a Fairglow fairness cream and get a mirror free.

§ Buy a Kodak camera and get a Dil Chahta Hai T-shirt free.

§ CMC Computer EducationOn enrolling for DST & eDAST, a set of 3 CDs of Brittanica Encyclopedia worth Rs.1995free.

§ Every pack of Rasna gives free prankies. This influences the kid to a great extent.Because of the prankies the kid wants to buy only Rasna and nothing else. So themom does not have a choice but to buy a Rasna

Many other kids products are influence a lot by such specialties especially likedby the kids like tattoos, masks, tazo, cricket bats etc. hence products that havesuch offers sell more than the other brand available.

§ Ruffles lays, get free Tazo,§ Rasna, get free Prankies§ 5 Alpenlibe get free tattoos§ 1 Marbles get free tattoos.§ Cadbury s Gems get Spiderman masks free.§ Cadbury s Dairy milk buy 2, 13gms chocolate get a toy free.§ Archies mousepads.§ Pepsi caps§ Duracell T-shirts



♦ Continuity/frequency Programmes

In recent years, one of the most popular sales promotion techniques amongconsumers has been “frequency Programmes”. The main objective of suchProgrammes is encouraging repeat purchases or repeated visits to particularretail shops. Frequency Programmes offer consumers discounts or free productrewards for repeat purchase or patronage of the same brand or company.

§ Shoppers stopObjective: reward the loyal customer.Shoppers stop started the First Citizens Club and enrolled customers asmembers of the shoppers club by charging a fee of Rs.150. The customers were

entitled to a variety of benefits by collecting points.

§ Indian Airlines frequent flyers programme where you get discounts on frequentvisits, get hotel stays free, credit facility etc.

§ McDonald s announced a promotion to stimulate repeat visits to its restaurants. Apart of the communication said now every time you buy a happy meal for yourkids, they get a lego system set with it - every 10 days there will be a different legosystem set inside each box.

♦ Brand placement

Brand placement often referred to, as product placement is the sales promotionstechnique of getting a marketer’s brand featured in movies and television shows.The use of a brand by actors and actresses or the mere association of the brandwith a popular film/ television show can create a positive image and have ahuge impact on the sales of a brand.Marketers and advertisers used to think that brand placements affected onlyconsumers’ perceptions of a brand, much like advertising. But recent brandplacements have shown that the technique can have a sales impact like atraditional sales promotions.

Brand placement has varying results; if the brand name is spoken aloud theimpact can be dramatic but less obvious placements, referred to as backgroundplacements are considered by some as a waste of money.

§ Coke in Yaadein , Pepsi in Khushi§ Pass Pass in Yaadein§ Tourist destinations in many films.§ Provogue shirts in all Fardeen Khan movies.



♦ Event sponsorshipWhen a firm sponsors or co-sponsors an event such as a rock concert, a cricketmatch, etc. the brand featured in an event immediately gains credibility with theevent audience. The audience attending an event already has a positive attitudeand affinity for the contest – they choose to attend. When this audienceencounters a brand in this very favourable reception environment, the brandbenefits from the already favourable audience attitude.

§ Hindustan lever limited:Project: Lakme Makeover promotion January 2002Objective: to present the amazing qualities of Lakme range of cosmeticsCity: DelhiStrategy: tie-ups with select outlets preceded the actual event. They served as the venuesfor makeovers that were conducted live on the spot. During the course of the promotion,a fashion show, featuring the 3 models that represent the range of the promotion, afashion show featuring the 3 models that present the range, was also organized. Thisevent led to a considerable increase in the actual sales of the products.

§ Coke and Pepsi keep sponsoring cricket matches.

§ Coke [V]Popstars this was one of the event sponsorships that had a lot of effect onthe sale of Coke. The V Popstars was a very interactive session being shown live onchannel Vand all those who watched it and liked it, automatically also developed afavourable impression of Coke because of their association with the event.

§ Britannia s association with the cricket world cup through the Britannia khao worldcup jao offer, has had a lot of impact on their sale and their brand image.

§ Ponds association with women s day creates a special liking for ponds amongwomen.

§ Britannia Tiger sales promotion s association with the Lagaan Super match alsoenabled Britannia to develop a positive image for the brand Tiger Biscuits in themind of the customers and consumers.

♦ Exchange offers

If a family bought a refrigerator 10 years ago and the machine is still givingreasonable service then the family is unlikely to buy a newer and more advancedversion of the refrigerator unless they get rid of the older one by selling it tosomeone. No one in our country is prepared to throw it as junk. Same thing istrue for a number of products such as televisions, microwave ovens, washingmachines, cars, two-wheelers, computers, etc.This segment of present owners is sizeable enough yet to sell new brands tothose who already own a similar product is not easy. To attract this segment,manufacturers regularly announce exchange offers.



Consumer durables market is the one where exchange offers are used the most.Almost all the TVs, Refrigerators, Washing Machines, etc. have exchange offers.

§ SamsungOn exchanging old TV for a new Samsung Plano, upto Rs. 5000 off.On exchanging old TV for a new Samsung Hitron Digital, upto Rs. 3000 off.On exchanging old refrigerator for a new Samsung refrigerator, upto Rs. 8000 off.

§ Kurl-onOn exchanging old mattress for a new Kurl-on mattress, get Discount upto Rs. 1200.

♦ Internet promotionsThey are the most recent form of sales promotions. They are promotions that aredone via the Internet. It is becoming increasingly popular because of the largeuse of Internet. But still it has a lot to develop.

The Godrej group of companies has launched "Godrej Bargainz", which the companyclaims is the first ever online sales promotion by an FMCG company in India.The promotion - where consumers can actually save while shopping from the GodrejStore on www.iBaya.com - will run exclusively on iBaya.com. Under the promotion, fivewinners will be chosen every week from the consumers who have shopped on the GodrejStore on the Website. The winners will receive a year's free supply of Godrej consumerproducts.According to the company, the store features the entire range of Godrej consumerproducts such as soaps, detergents, toiletries, hair colours, shampoo, hair oil, fruitbeverages, processed foods, wheat atta, packaged foods, bakery items and householdinsecticides. Further, all the products have been made available at a special discount onthe MRP to the consumer.

http://www.iBaya.com



TRADE PROMOTIONS

Sales promotions can also be directed at members of the trade – wholesalers,distributors, and retailers. It is intended to stimulate demand in the short runand help push the product through the distribution channel more immediately.Effective trade promotions can generate enthusiasm for a product and contributeto the loyalty distributors show for the brand. With the massive proliferation ofnew brands and brand extensions, manufacturers need to stimulate enthusiasmand loyalty among members of the trade and also need a way to get the attentionof the buyers suffering from information overload.

Objectives for promotions in the trade market

Generally speaking, when marketers devise incentives for the trade market, theyare executing a push strategy – i.e. sales promotions directed at the trade helppush a product into the distribution channel until it ultimately reaches theconsumer.

♦ Obtain initial distribution

Because of the proliferation of brands in the consumer market, there is fiercecompetition for shelf space. Sales promotion incentives can help a firm gaininitial distribution and shelf placement. Like consumers, members of the tradeneed a “ reason to choose” one brand over the other when it comes to allocatingshelf space. A well conceived promotion incentive might sway them.

♦ Increase order size

One of the struggles in the channel of distribution is over the location ofinventory. Manufacturers prefer that members of the trade maintain largeinventories so that the manufacturer can reduce inventory-carrying cost.Conversely, members of the trade would rather make frequent, small orders andcarry little inventory. Sales promotions techniques can encourage wholesalersand retailers to order in large quantities, thus shifting the inventory burden tothe channel.

♦ Encourage co-operation with consumer market sales promotions

It does a manufacturer no good to initiate a sales promotion in the consumermarket if there is little co-operation in the channel. Wholesalers may need to



maintain larger inventories and retailers may need to provide special displays orhandling during consumer market sales promotions. To achieve synergy,marketers often run trade promotions simultaneously with consumerpromotions.

♦ Increased store traffic

Retailers can increase store traffic through sales promotions or events. Apromotion that generates a lot of interest within a target audience can driveconsumers to retail outlets.

Techniques of trade sales promotions

♦ Allowances

§ Off-invoiceHere marketers allow wholesalers and retailers to deduct a set amount from theinvoice they receive for merchandise. This programme is really just a pricereduction offered to the trade on a particular marketers’ brand for a specifiedshort promotional period. The incentive for the trade with this programme is thatthe price reduction increases the margin (and profits) a wholesaler or retailerrealizes on the off-invoiced brand.

This scheme is in general available for many products, where if the bill amount is abovea certain amount you get a certain percentage discount. The % varies from around 2% to10%, from company to company and also from time to time.

§ Buying allowanceIt is similar to the off-invoice allowance. It is a discount for the purchase of thepromoted product during the specified period on the purchase of certainminimum quantity of the product. This trade incentive is often used to gainmore distribution or to maintain the existing one.

§ Display and advertising allowanceThe retailer is required to arrange the product display in a prominent show-window or offer discount to consumers and advertise this offer in the localnewspaper or arrange a point-of-purchase display on the shelf corner. Theretailer earns the incentive only after meeting the conditions set by themanufacturer.

§ Buy back allowance



Manufacturers sometimes announce a buy-back allowance to encourage re-stocking by retailers. This promotion immediately follows another type of dealoffered to resellers and offered some incentive for new purchases. When themanufacturer realizes that after the initial deal the inventory levels at the retaillevel are quite low or depleted, such an offer helps in building the inventorylevel with retailers to normal.

§ Bill back allowanceThe manufacturer offers a discount for every item purchased during thepromotion period. At the end after the promotion is over, the dealer counts thediscount per unit for all the items bought during the promotion period, adds anyadditional promotional allowances as stipulated by the manufacturer andsubmits the statement. He also needs to submit the bill for all such items.

§ Count and recount allowanceThis allowance consists of an offer of certain amount of money to retailers foreach unit of promoted product sold out of their stocks during a specified periodof time. The sales person concerned counts the opening stock with each retailerat the start of promotion and a final recount is made at the end of the promotionperiod. It can be used to ensure that resellers are not out of stock. The deal is easyto implement and the allowance is paid only on product units sold from theretailer’s shelves.

§ Slotting allowanceThese are the fees that a retailer charges the manufacturers to make available thespace on the shelf for their new products. Retail store owners say that thenumber of brands in each category is multiplying, there is increasing competitionand margins are decreasing, hence they have no option but to ask for a fee tokeep the product on their shelf and use the money to improve their shelf designand promotion, etc.

♦ Merchandise allowanceIn the form of free products packed with regular shipments, are payments to thetrade for setting up and maintaining displays. The payments are typically far lessthan manufacturers would have to spend to maintain the displays themselves.

Some of the schemes operating in town are:

§ Buy Cadbury s products worth Rs.3000/- and get 30 any chocolates worth Rs.5 free.


§ Buy 30 Bonbon packs and get 1 free.



§ Buy Colgate toothpaste worth Rs.500/- and get 6% discount.

§ Buy 24 Close Up toothpaste and get 1 free.

§ Buy 3 Good Knight Liquid packs and get 1 free.

§ Buy 3 Mortein coils and get 1 free.

♦ POP displaysPoint-of-purchase displays i.e. product displays and information sheets areuseful in reaching the consumer at the point of purchase and often encourageretailers to support ones brand. POP promotions can help win precious shelfspace and exposure in a retail setting. From a retailer’s perspective, a POPdisplay should be designed to draw attention to a brand, increase turnover, andpossibly distribute coupons and sweepstake entry forms.

Companies do P-O-P displays as and when they have sales promotion schemesgoing on.Some companies that do a lot of P-O-P displays on a regular basis are Gillette, Vicks,Duracell, Pepsi, Coke

♦ Cash rebateThis is a form of delayed value promotion for the retailer. Only after the proof ofperformance is furnished, the retailer is given a cheque for the amount ofdiscount.Once a retailer has met the laid down conditions, the rebate is given to theretailer. The advantage of this method is that the rebate is given only after theretailer has performed to qualify for the rebate.

♦ Free goodsA free goods promotion is a deviation from straight price cut. The promotionoffer to trade is in the form of extra quantity of purchased product “free”. Forexample, the manufacturer offers one case of free goods with the purchase of 12cases of the product. There may or may not be any limit on the quantity of thepurchase during the promotion period. If the retailer purchases 36 cases of theproduct, then he gets 3 cases of the same product free.Free goods deal often encourages resellers to stock more during the promotionperiod. For the manufacturer, it is an excellent promotion because it costs lessthan it otherwise appears.

§ Buy 24 Close Up toothpaste and get 1 free.

§ Buy Cadbury s products worth Rs.3000/- and get 30 any chocolates worth Rs.5 free.




§ Buy 3 Good Knight Liquid packs and get 1 free.

§ Buy 3 Mortein coils and get 1 free.

♦ DatingManufacturers of seasonal products often use dating as a technique of salespromotions. Dating is not a direct type of allowance such as free goods or cash.Manufacturer extends the facility to retailers to purchase a certain quantity ofproduct now but the billing is done after a period of time. It is not only thebilling, the retailer purchases the product at some reduced price during thepromotion period, however, the goods are shipped at a later date.

♦ Trade couponsIt is a manufacturer initiated sales promotion, however, the coupon distributionis undertaken by retailers, either through local print medium or in some othermanner. The important thing about such coupons is that they can be redeemedonly at the distributing store. There is an agreement between the retailer and themanufacturer that some agreed allowance will; be paid to the retailer. Generallythis is in the form of re-imbursement of some amount of money to the retailer foreach coupon redeemed. The distributing retailer gets the double benefit due tothe increase in store traffic and the incentive of reimbursement from themanufacturer. This is a string incentive to the retailer to arrange displays andpromote the coupon offer.

♦ Dealer loadersA dealer loader is a premium that the manufacturer gives to the retailers forbuying a certain quantity of a product. There are generally 2 types of dealerloaders – buying loader and display loader.A buying loader is given to the retailer on purchase of a specified quantity of aparticular product.A display loader is the premium given to the retailer for the window display.After the promotion period is over, the item or items, are given to the retailer as afree premium.

♦ SPIFFS (also called ‘push money’)It is a monetary reward given to the salesforce of the dealers to sell amanufacturers product. For example, a manufacturer of washing machines mayoffer Rs.500 to each sales person who sells the manufacturers’ brand of washingmachine. The SPIFF money varies as does the willingness of the dealers to allow



the salesforce to accept the offer. Dealers who carry product brands of differentmanufacturers generally hesitate to allow such offers.

♦ IncentivesIncentives to the members of the trade include a variety of tactics like awards inthe form of travel, gifts, or cash bonuses for reaching targeted sales levels thatinduce retailers and wholesalers to give a firms’ brand added attention. Theincentive does not have to be large or expensive to be effective.Another form of trade incentive is referred to as ‘push money’ i.e. SPIFFS.

♦ Sales-training ProgrammesAn increasingly popular trade promotion is to provide training for retail storepersonnel. This method is used specially for consumer durables like personalcomputers, exercise equipment, etc. the increased complexity of these productshas made it important for manufacturers to ensure that the proper factualinformation and persuasive themes are reaching consumers at the point ofpurchase. For personnel at large retail stores, manufacturers can hold specialclasses that feature product information, demonstrations, and training aboutsales techniques. Another method to give information would be the use ofvideotapes and brochures.

Hewlett PackardPromotion: Mystery shopper programObjective: to revitalize the distribution chain, audit retailers and the competitivesituation.City: Delhi, Mumbai, Ahmedabad and many moreStrategy: aimed at the dealers, the objective of this promotion was top revitalize thedistribution chain, audit retailer and competitive situation. Mystery shoppers visited theretail outlets to ascertain merchandising and retailer-consumer interaction.

♦ Trade showsAt trade shows, related products from many manufacturers are displayed anddemonstrated to members of the trade. Literally, every industry has trade shows.Their representatives are there to explain the products and services and perhapsmake an important contact for the sales force. The use of trade shows must becarefully coordinated and can be an important part of the business marketpromotional programme. Trade shows can be critically important to a small firmthat cannot afford advertising and has a sales force too small to reach all itspotential customers.



SALES FORCE PROMOTION

Sales promotion directed towards the sales people is referred to as sales forcepromotions. These schemes are intended to motivate sales people to put in moreefforts to increase sales, increase distribution, promote new or seasonal products,sell more deals to resellers, book more orders, develop prospects lists and buildup morale and enthusiasm. Some of these activities are meant to prepare thesales people to do their jobs well and include sales meetings and manuals,training programmes, sales presentations, film and slide shows etc. Prizedistribution to winners is the more tangible aspect of any such programme.

Objectives of sales force promotion schemes are:

♦ Increase sales volume♦ Introduce a new product♦ Reducing selling costs♦ Offset competitive promotions♦ Improve working habits♦ Develop new prospect lists etc.

Tools used in sales force promotions

♦ Sales meetingsSales meetings are generally organized for sales people form one area, region ordistrict more frequently, usually once a month, once in two months, or quarterly.These meetings bring together sales people from different territories of the nationand are considered a popular way of educating sales people. There is a varyingmixture of business and pleasure.Educational material of sales meetings generally focuses on product knowledge ,selling skills and motivation of the sales force. The programme often includesformal lectures, quiz shows, etc. The purpose is to generate interest andenthusiasm and the winners are awarded prizes and certificates.

§ Max HealthcareObjective: to celebrate the annual day of Max-India and instill a sense of pride amongstthe employees for being exclusive Max-team members.City: DelhiStrategy: presentations, reviews and their vision for the future marked the evening. Anaddress by the chairman, Mr.Analjit Singh and the award ceremony were the highlights.The vent itself was held in park royal, Delhi. Live feed of the evening was transmitted onaudio-visual screens. This exclusive live relay added to excitement among the invitees.



§ ElectroluxPromotion: Salespersons Meet- operation juggernautCity: GoaObjective: To encourage the sales personnel to sell moreStrategy: salespersons were treated to a futuristic experience with the theme of startwars. Laser shows, glass-shattering effects, etc. were a part of the theme.

♦ Sales ManualsTraining materials such as manuals, visual aids, flip charts, programmes,learning books are most useful to sales people. Sales manual may be long orshort depending upon the type of the products manufactured and sold by thecompany. The sales manuals usually contain product details, applications,manufacturing processes, prices, sales techniques etc. Some companies also havehouse journals that reports about the company programmes, new products,research activities, new polices, awards, promotions, etc.

In any firm where personal selling is critical for the sale of the product incentivesto the sales people become very important. Incentive programmes most oftenused by the company include paid vacations within or outside the company,cash rewards, prizes, honour awards, merit certificates for excellent performanceetc.

♦ Training♦ Sales contests♦ Incentives♦ Awards and prizes♦ Premiums (gifts)

Consumer-cum-Dealer-cum-Sales force sales promotions:

NokiaPromotoion: perfect 10 contestObjective: to attract channel partners, salespersons., an prospective buyersCity: 15 citiesStrategy: the contest was three fold - for consumers, dealers, and sales personnel. Alarge number of activities were organized. Dealer road shows, mass media consumercompetition and intensive merchandising were undertaken. Lucky draws were conductedand the participants get to win some great prizes also.



Few Differencesbetween Brands

Significant Differencesbetween Brands

ComplexBuyingBehaviour

Variety-SeekingBuyingBehaviour

HabitualBuyingBehaviour

DissonancereducingBuyingBehaviour

High LowInvolvement Involvement

THE CONSUMER DECISION MAKING

The consumer decision process begins with the recognition of need; that is, theconsumer must recognize the need to purchase a product. Only then does he gothrough the process to choose the product. A display or any other promotionmay remind the consumer that he/she needs the product, or may awaken thelatent demand for the brand or product category. Because of the salespromotional communications, need or problem recognition may get triggered inboth high involvement as well as low involvement consumers. If the purchasesituation happens to be one of high involvement, triggered by an attractiveexchange offer, or interest-free installments for consumer durable products suchas refrigerators, oven, washing machine, colour television set, etc., it is morelikely to result in extensive problem solving effort rather than immediatepurchase. The sales effect in case of low involvement situation is likely to beimmediate because of unplanned or impulse buying or because of familiarity ortop-op-mind recall of the brand. The consumer may think it is not worthdevoting time and effort to the purchase situation in question. The low-involvement consumer may have visited the retail store with the intention ofpurchasing a certain product but an in-store display attracted his/her attentionand led to brand switching or impulse buying. According to some researchers,this type of behaviour is an attempt towards reducing the amount of mentalexercise by using simple decision rule in making a purchase decision. Someexperts believe that price-cut and in-store displays are more effective for low-involvement than high-involvement consumers.

In a severely competitive market where brands are considered as having no realdifferences, consumers learn that many brands will meet the requirements.Naturally, the purchase behaviour is likely to become one of low-involvementand the brand on promotion has more chances of being purchased.

One can distinguish four different types of behaviours depending on the degreeof perceived difference among brands and the level of consumer’s involvementin a purchase situation.



‘Complex Buying Behaviour’ is shown by consumers when they perceivesignificant brand differences and they are highly involved in the purchasesituation. Such a situation may result because the product is expensive, egointensive, risky in some way, or infrequently purchased. The consumer does notpossess any meaningful information about the product and is in need ofinformation. He/she makes a well-considered purchase.

‘Dissonance-Reducing Buying Behaviour’ results when the consumer’sinvolvement in the purchase situation is high because the product is expensive,risky, self-expressive or infrequently purchased. The differences among brandsare perceived as not significant. After the purchase, consumer experiencesdissonance. As all the brands would not have all the features, the consumersuspects the correctness of her/his decision. This causes uneasiness and theconsumer looks for reassuring information and avoids disconcertinginformation.

‘Habitual Buying Behaviour’ results when the consumer’s involvement is lowand there are no significant differences among brands. This is generally the casewith most low priced and frequently purchased products. In this category, salespromotions can lead to considerable brand switching. Consumers buy theseproducts as routine purchases and do not consider them to be important. Theyreach for certain brands because of familiarity and not because of any brandloyalty.

‘Variety-Seeking Buying Behaviour’ results in product categories where thereare significant differences among brands but the consumer has low involvementin these products.

There is much brand switching due to variety seeking or boredom. Salespromotions can encourage increased brand switching because of premium offeror due to some contest.

When the information requirements are high and there is an absence of anyestablished criteria for evaluating the product category or specific brands in thecategory, the decision-making would be one of extensive problem solving (EPS).Typically, the purchase situation would be one of high-involvement.

If the consumers have already established some criteria to evaluate the productcategory or the brand, they are likely to engage in limited problem solving (LPS)and would collect some additional information to reach a decision. They may nothave any preference for a particular brand and hence would like to know a little



about the differences among brands. This would be more like “fine tuning” theirdecision.

When consumers have some experience with the product category and haveestablished criteria to evaluate different brands, they may buy the product as amatter of routine. This is routinised response behaviour (RRB). In some cases theconsumers may search for a small amount of additional information but, ingeneral, they only review what they already know. Sales promotions can lead tosignificant increases in the sales figures of the products if the consumers’ buyingbehaviour is routine type (habitually buying behaviour).

HOW ARE SALES AFFECTED BY SALES PROMOTION?

A question asked by numerous today .But at theend of the day do promotions increase sales?

Earlier this month, Smithkline Beecham Consumer Healthcare launched a promotion forHorlicks and is offering a game with the drink.Result?

Within 15 days Horlicks sales have gone up. Nestle s Milo, too, has been doing fairlywell purely on the basis of the cricket bat it offers with the product, says a retailer at asupermarket in Mumbai.

How does sales promotions influence sales ?There are 4 basic mechanisms involved:

1) Brand switching2) Repeat buying3) Purchasing more or accelerating timing4) Increasing category expansion and consumption

1) Brand switchingThe objective of some sales promotions is to induce brand switching, i.e.encouraging the consumers to purchase the promoted brand instead of theregular brand that would have been purchased had there been no salespromotion. This type of brand switching is often called ‘aggressive switching’.The second type of promotion effect on brand switching is considered as‘defensive switching’. In this case, the objective is to retain the customer byencouraging him to buy the same brand as was bought on earlier occasions.



Godrej offered free gifts plus discounts on its washing machines to make consumersshift from newly arrived competition (Samsung). That was an aggressive strategy.To prevent its customers from shifting to Godrej, Samsung had to launch a similarscheme of free gifts and price discounts. This was a defensive strategy.

The manufacturer’s concern is to compete with other similar brands, whilethe concern of the reseller is to encourage customers to buy from his store.When a retailer promotes, consumers respond by switching stores, i.e. theypurchase from the store that is promoting instead of the regular store.

Promotions offering price deals influence the attitude of consumers towardsbuying the brand. Much would depend on the size of the discount and theconsumers’ sensitivity towards price and how much importance consumersplace on price as compared to quality. If the attitude toward the brand hasbeen quite low compared to some other brands, then a price promotion islikely to encourage a switch to the promoted brand. Such price promotionsmay also encourage consumers to buy an otherwise expensive brand whichthey could not afford on the normal list price.

Displays at the points of purchase may induce brand switching because theyserve as conditioned stimuli associated with price promotions. Over a periodof time, consumers get trained to associate displays with price reductionsand respond even when the price reduction is not there.

If most of the consumers are inclined towards low prices because ofeconomic conditions, the majority of them are assumed to be buying lowpriced brands. However, if the price of an expensive item is reduced becauseof a promotion, some consumers from low quality category will switch to thepromoted brand. But when the low quality product is promoted, there is noswitching because the consumers have been buying the brand withoutpromotion. The consumers from high-income group are unlikely to switch tolow-price brand because of promotion and the sales gains would not bethere.

2) Repeat buying When a consumer buys a product on promotion, this may lead todeveloping a habit towards purchasing that brand and some evaluationabout the performance of that brand. It may also happen that since the brandis purchased on promotion, the consumers’ attitude towards the brandweakens, and the probability of purchase in future declines. Repeat purchasemay result because of habit formation that may develop because the brand isbought more than once due to sales promotion. Much depends on thesatisfaction of the consumer with the brand purchased on promotion.



For example, if a customer purchased a Godrej refrigerator on promotion and wassatisfied, it is very likely that next time when the need arises, the customer wouldpurchase the same brand again on promotion, or other products of the samemanufacturer when available on promotion.

Repeat purchasing is often the result of habit formation and learning. Salespromotions stimulate the customers to by a product and this becomes thefirst step towards establishing a habit. Another route is not to allow thebrand user to shift to some other brand by rewarding and reinforcing thealready established behaviour.

In case of low-involvement products, the role of habit is more important. Theconsumer does not want to devote much time to thinking and pre-purchaseevolution in making a purchase decision. Habit helps the customer avoidany cognitive effort and helps as a simple and convenient way to decidewhich brand to purchase.Once a consumer gets used to the long-lasting effect of Duracell batteries, itbecomes a habit and he would not think much before going in for the same brandagain.

In case of high-involvement products, it is assumed that learning takes placewhen the consumer experiences the actual performance of the product andmakes an evaluation. A favourable evaluation is likely to help sustain thehabit. In some cases, even consumers with low involvement often makeevaluations that may have repercussions with regard to developing thehabit.This holds true to a great extent in case of industrial products, where the actualexperience after initial usage is very important.

3) Purchasing more or accelerating timingPurchasing more and accelerating timing refers to those situations whenconsumers buy more than their immediate requirement, or shift theirpurchase timing as a result of promotions. When resellers buy more thantheir normal requirements, it is called ‘forward buying.’ Building excessiveinventories in this manner often leads to stock diversion in non-deal areas.Another important repercussion of this purchase behaviour is that it merelyshifts the purchases which would have occurred anyway.For example, if a consumer buys more than the immediate requirements, then in thenext purchase period, this consumer either would not buy, or buy less. In anothersituation, due to promotion, the consumer buys the refrigerator now, though theintention was to buy after 2 months.This is purchase acceleration.



Another effect of promotion can be that consumers who have bought inexcess of their requirements would be out of the market. Similar would bethe retailers’ shelves are full. This can help in pre-empting the competition.Such acceleration in purchase quantity would also help in preventing brandswitching, and in some cases, more consumption of the product.

The reverse may also be true in certain situations, i.e., negative accelerationwhen the consumers buy less or decide to purchase later rather than now.This may happen when the sales promotion stimulates brand switching. Theconsumer wants to try the product and buys a smaller quantity to reduce therisk associated with using something new. The consumer may also postponethe purchase of a product because he/she learns from some source about theforthcoming sales promotion or anticipates it.

4) Increasing category expansion and consumptionSales promotions are likely to stimulate demand by creating new occasionsfor purchase or by increasing the consumption rate of consumers. In certainsituation, the purchase of a product category gets accelerated. Salespromotions such as displays can create new purchase occasions by thereminding the customer that the displayed product is good for growingchildren (protein biscuits). Other products, for example noodles or potatochips purchased on promotion in multiple units, can increase theconsumption rate, which is often the objective of many promotions.One example can be of condensed milk, (Milkmaid). An attractive display of thisbrand is arranged and a free recipe book is given on purchase of 2 packs. This isquite likely to increase the rate of consumption of this product and consumers will betempted to try different recipes.

In case of many high-involvement products, promotions can help consumersto realise that a certain product would serve as a good gift item (a silk sari,camera, a Cadbury pack, Ray-Ban sunglasses, etc). In some cases, there is acertain price limit beyond which the consumers will not buy a product.However, a price promotion offer lowers the price of the product below thecustomer’s price limit, and thus a purchase occasion is created. Manycustomers buy cars when available on promotion such as interest-freeinstallments, which otherwise they are not in a position to buy on downpayment. Of late, this is happening in case of almost all brands of computers.

Observations in the market place point to the likelihood that brandswitching, repeat purchasing, purchase acceleration and consumption, alloccur simultaneously. The net result, however, is that sales promotionswork.



SALES PROMOTION BUDGET

The allocation of monetary resources to sales promotion is determined by thepromotional strategy of the firm.In most cases, first the total amount of money for promotion is determined thenit is budgeted for different activities. Before deciding the money allocated tosales promotion, the management should evaluate relevant factors such as typeof product, its stage in PLC, the market situation, level of competitive activity,etc. All these factors, alone or in combination, can significantly affect thepromotional budget. There are five important techniques that are commonlyused to allocate funds to sales promotion.

♦ Percentage of sales method

The percentage of sales method to allocate the funds is probably most popularamong companies. In this approach, the budget is determined by taking a fixedpercentage of sales. The sales figure taken could pertain to the previous year, orthe average of several past years. This percentage could also be based on theforecasted sales of the year under consideration.

♦ Unit of sales method

This method is commonly used by companies dealing in high-priced products,generally consumer durable goods such as four and two wheeler auto-manufacturers, refrigerators, washing machines, microwave ovens,entertainment electronics and many other items.Instead of rupee value of sales, as in the previous method, the base is thephysical volume of either the past or anticipated sales. This figure of units isthen multiplied by a fixed amount of money to reach the budget amount. Forexample, the manufacturer might allocate Rs. 2000/- per unit for salespromotion.

♦ Competitive parity method

Many marketers match or base their sales promotion budget to that of the majorcompetitors. The logic attributed to this method is that the collective minds ofthe companies in the industry probably generate promotion budget that are closeto optimal and any departure from the industry norms may lead to promotionwar.

♦ All you can afford methodIn using this approach to budget allocation, the amount that is leftover after allother relevant allocations have been made, is earmarked for sales promotion.



This approach is used, generally, by companies with small budget, or by someother companies, large as well as small, when they are introducing a newproduct. It is merely an availability oriented budget and quite unsophisticated.Apparently, there is no realisation that in a competitive market situation, salespromotion mainframe sales in many ways.

♦ Objective end task method

As mentioned earlier, the promotion budget is determined by the overallpromotional strategy. Objective end task method approach is the one which isdriven by strategy. This is also the most popular technique to decide the salespromotion budget. The promotion manager starts by making a thorough studyof the market, the product, competition and consumer behaviour in order to setup appropriate promotion objectives. These objectives may relate to increasingshort-term sales, introducing a new product, stimulate trial, increasingdistribution, etc., within a specified period of time. Next step is to determinehow much money would be necessary to accomplish each task involved inachieving the objectives. If the costs happen to be more than the moneyavailable, then either the promotion objectives adjusted or more funds are madeavailable from the contingency reserve or by reducing the budgets of the otherpromotional activities.

SALES PROMOTION EVALUATION

Measurement of results in any area of business activities related to the objectivesthat are set. To accomplish this, set of evaluation criteria is laid down before theimplementation of the sales promotion programme. A number of theseobjectives are directly related to sales. In all such cases, the measurement doesnot pose any complexity and the sales based techniques can be used with relativeease. For instance, it is quite easy to measure the sales effect before, during andafter the sales promotion. In case of objectives not related to sales, such as trialpurchase, or changing consumer awareness and attitude as resultant increaseand perceived value of the product, measurement is more difficult. In certaintypes of promotion, the reseller support is important and can have significanteffect on marketer's promotion performance.

♦ Pretesting

How sales promotion is to be communicated and what would be communicatedto the target groups is important and can be pre-tested. For example the pre-tested may find out what is likely to be the perceived value and the risk. Acustomer considers whether it would be wise to buy an unknown brand of sportshoes at a 45% discount. In this offer was there a risk of buying an unfamiliar



brand? The pre-test can be conducted to assess these factors by using focusgroups and consumer panels. Another approach, ballot method, consists ofkneeling a ballot paper to a list of consumers. They are requested to evaluatedifferent illustrated promotion is and vote for the most light and return the ballotto the firm. A relatively expensive but more accurate method is a portfolio test.A portfolio of sales promotion is prepared and shown to consumers in personand the responses are noted.

To test consumers behaviour responds such as trial purchase, repeat purchase,etc., pretesting consists of experimenting in certain markets for individual storesin a market. All other factors remain the same; only the sales promotion devicebeing tested is the variable that is manipulated.

It is often quite helpful to evaluate the responses of resellers beforeimplementing the promotion programme. The simplest ways to visit severalimportant retailers and wholesalers, discuss the programme and seek theiropinion and suggestions. This may prove to be quite favourable in case thesupport of resellers is considered to be of paramount importance for promotionresults.

♦ Concurrent testing

This testing is done when the sales promotion is in progress. Concurrent testingthe permit the promotion manager to modify the sales promotion, if neededThis type of testing is conducted in terms of sales data which can be obtained ona weekly or monthly basis. If the promotion is a consumer contest and theconsumer is not require to purchase anything, the response to promotion can beadjudged by the number of entries received at some interval and if need be, thecontest period can be extended. In case of a coupon distribution programme,similar approach can be adopted by keeping track of coupons redeemed.

♦ Post testing

Post-testing is done after the promotion period is over. To assess the changingconsumer awareness and attitude, telephone calls, questionnaire mailed to theconsumers and personal interviews can be used. In these methods, the mostexpensive is the personal interview method and the least expensive is the mail.The information sought pertains to the promotion event. In case of samples onpremiums distributed through retail stores, intercept interviews at the Point ofSale can reveal more reliable information.

To measure the sales affect, sales figures before the promotion period can becompared with figures at the end of promotion and one month after the



promotion ends. Suppose that the promotion objective was to increase sales by30 percent in certain period and the pre-promotion sales for a similar periodwere worth 5 million rupees. The sales jumped to in excess of 5.6 million in thepromotion period. This would show that the objective was achieved. It is verylikely that in the ensuing month after the promotion, the sales will come down tosay 3.5 million rupees. In the sales return to 5 million rupees on the long run,then perhaps the sales jump is because of brand features and deal pronecustomers. However, if the regular sales settle at 5.5 million rupees on the longrun, then definitely the promotion prove successful in increasing the long runsales by attracting new customers and we have also attracted customers awayfrom other competing brands.



PROMOTIONS

CASES

PRODUCT CATEGORY: FMCG (beverages)

PEPSI

The company believes that sales promotions are an integral part of their overallmarketing strategy.Sales promotions are carried on at 2 levels –§ Customers i.e. trade§ Consumers

Why trade promotions?

Trade promotions are essential for 2 major reasons:

§ Drive volumes – the main objective of any sales promotion is to increasesales.

§ Visibility – the category demands not only volume, but also increasedvisibility in order to build the brand.

Trade promotions are comparatively easier to implement because the audience issmaller, direct contact is maintained as company salesmen are in continuousinteraction with the dealers.

SUCCESSFUL TRADE PROMOTIONS:

“Aha Bar Mein Jar”

Product: Pepsi Aha

Objective: Launch of Pepsi Aha and to induce trials.

The Rationale:



The company realised that it is essential to gain entry into the market first beforecarrying out consumer promotions. So the company decided to focus on bars toenter through a specific channel.The company based on a research identified the waiters as the major influencersin purchase of drinks in bars. So in an effort to induce trials of Aha among theconsumers at bars, Pepsi launched the “Aha bar mein jar” offer.

The Promotion:There were huge jars, branded and packaged as Pepsi Aha placed at the bars.The waiters were required to fill up the jars with Pepsi Aha crowns. After which,they would receive gifts and prizes from Pepsi.

The Result:The campaign resulted in:§ Increased Volume Sales§ Improving the equity of Pepsi among waiters.§ Created consumer preference for the brand.

CONSUMER PROMOTIONS:

Consumer promotions are identified at Pepsi at 3 levels:

§ National level§ Local Level§ Key A/c’s Specific

The two major objectives for the promotions are:

§ Volume growth§ Brand building

For instance the campaign in Pune wherein Fardeen Khan visited 10 colleges inPune may not drive volume sales but did enable top of mind recall for Pepsi fora very long duration.

Key Accounts:

Key accounts could be, for instance, all pizza outlets across the city or anyspecific pizza outlet like Pizza Hut wherein Pepsi conducts specific salespromotions campaigns.Key accounts specific promotions are carried for certain major reasons:

§ They act as volume drivers.



§ They aid in image building – e.g. If Pepsi ties up with Restaurants, thentheir food – Pepsi association becomes stronger. Likewise the Pepsi cricketAssociation will be reinforced through their forthcoming campaigns forthe cricket world cup.

§ They act as reactionary tools to counteract competitor’s strategies.

Promotion could be of two kinds:

§ UTC (Under the crown)§ SLP (gifts, labels, accessories)

Timing of Promotion:

§ Seasonal During Ganpati festival Pespi promotes the Mangola brand through

contests to leverage the association between Mangola and Mumbai.

§ Reactionary to competitors strategy: With Maaza’s strategy to offers tattoos to their consumers, Mangola is also

gearing up to offer promotions.

§ Launch of a new brand:

Besides this during monsoons, sales are pretty low so the promotions aredirected accordingly. Like wise the brand intends to leverage their promotionson the forthcoming movie ‘Khushi’ that stars their brand ambassadors; FardeenKhan & Kareena Kapoor. Also the company is gearing to use the forthcomingcricket world cup to the hilt.

PEPSI AHA

Objective: To induce trials

Timing: Summer 2002

Vehicle: Games and contests

The Promotion:The company spent 3 weeks identifying four major channels through whichtheir promotions would be directed at the consumers. They include:

§ Eateries§ Theatres



§ Schools & colleges§ Pubs

The companies decided to use games to entice the consumers. The deal wasthat the consumers would play a lot of games and win Pepsi – Aha as prizes.The games had to consider the ‘brand values’ Pepsi – Aha aimed to beidentified with.They selected Johny A as their brand personality. The games included jigsawpuzzles that had the image of Johny A and hoopla games.

Result:Consumers’ response to the promotion was very effective. The enthusiasmgenerated by this promotion among kids and teens ensured a high top-of-mindrecall for the brand.However, the top line marketing was not upto the mark and was responsiblefor the poor sales of the brand. The television ads and hoardings were noteffective enough to persuade the consumers to purchase Pepsi Aha.

Pepsi – Mera Number Aayega Campaign

Offer: Prizes including cash prizes to be won

Platform: National level

Vehicle: Under-the-crown contests

Communication: The promotion was communicated through televisionpersonality Cyrus Broacha using television and newspaper media along withoutdoor advertising to communicate the campaign.

PEPSI STORYBOARD:

Dejected, he asks themaid, Mera number kab

aayega?" ."Aayega baba number,"she assures him.

Children are playing onswings. A young Cyrus iswaiting for his turn, but ispushed aside by otherkids.



Promotions that failed to deliver the results:

Mangola Ganpati Promotions 2002:The company had conducted certain contests through advertisements in localMarathi newspapers (ex: Loksatta). However the campaign failed to generateany response.

Promotions in Pubs to leverage their tie up with Deep Purple Band: This was acase of selection of wrong channel which Pepsi realised a little too late. Pubsdo not permit companies to put up posters in their premises. Added to that thepeople frequenting the pub wanted a variety of songs to be played and not justdeep purple songs. After this experience the company has decided not toventure into pubs for promotions unless the product category favours it, (likeShock and Baccardi Breezer)

Evaluation of the campaign:

The company measures the success of the campaign based on consumer healthi.e. top of mind recall. Although sales volume matters, the company lays stresson building brand equity.

A few years later, at abasketball court all the guysare selected, except our Cyrus.

...numbered crowns and youcould win lakhs every week."

Now in college, the youngstersdecide who gets to kiss girls byrotating a bottle of Pepsi. Heretoo...

...Cyrus misses by a hair'sbreath. "Mera number kabaayega?" wails our perpetualloser.

VO: "Ab to aa hi jaayega. DrinkPepsi, collect...

Disappointed yet again, hetugs at the coach's shirt andasks, "Mera number kabaayega?"

I won, I won," exclaims a guystanding next to Cyrus at anopen-air cafe. Cyrus looks at hisluckless crown.

This time our boy Cyrusdoes not lose hope ashe convinces himself,"Mera number aayega."



PRODUCT CATEGORY: FAST-TO-COOK SNACKS

MAGGI

Introduction:

Maggi Noodles was launched in 1982 as a tasty treat for children, with a strongfun element communicated in the brand’s advertising. The packaging was bright,innovative and attractive. The brand appealed to mothers because it wasconvenient, taking only 2 minutes to prepare, and because the price was veryaffordable. Initially it was a runaway success.

Two problems emerged subsequently. Cost escalation forced the company,Nestle, to increase the price. Secondly, it became clear that the user base was fastchanging and expensive continuous advertising was required to maintain sales.The need was to establish and stabilise a core franchise of loyal regular usersamong children under 14, especially those aged 8-10 who had been identified asthe biggest fans of Maggi Noodles.

As a sales promotion campaign they formed the Maggi club.

ANALYSIS:

Objective:

To build a core franchise for the brand by establishing an ‘ongoing dialogue’with young children over time, by means more closely targeted and lessexpensive than continuous mass media advertising.

The Promotion:

Children under 14 were invited (by press advertisements and leaflets distributedin select schools) to become members of a Maggi Club, by sending logos cut from5 empty wrappers of Maggi Noodles.Members received a club membership Card and a list of gifts of fun activities forthe year ahead, since ‘Maggi Clubbers are Fun Lovers’.



Gifts such as:

§ Snap Safari Game§ Laws Of The Jungle Game§ Cap And Mask Set§ Disney Today Comic§ Standees Set§ Travel India Game

To obtain each of these items, the Club Member was required to send theapplication with 5 proofs of purchase of Maggi Noodles.Details were also mailed to Members of special privileges negotiated for them bythe Club from time to time, e.g. discount tickets at ‘Appu Ghar’.

Results:

The enrolment of members was extremely successful. In fact members were sofar above target that there were some difficulties in coping with applications.The membership of the Maggi Club has grown by more than 75% per annumsubsequently. These members represent an expanding core franchise of regularusers of the brand.

Clubs are an attractive concept for any marketing executive looking to get‘closer’ to regular consumers of his brand. They are especially attractive whenchildren are the consumers: many children like belonging to a ‘gang’ and lovereceiving mail addressed to them personally. A club gives the brand theopportunity to talk direct to the child, without the intervention of the motherwho is so often – as with Maggi Noodles – the purchaser of products designedfor child consumption.

The Maggie scheme had no ‘frills’, all of which would cost money. Itconcentrated single mindedly on encouraging regular usage of Maggie Noodlesby offering a wide variety of attractive gifts in return for multiple proofs ofpurchase.Membership grew to a size where it also represented a valuable direct-marketingdatabase for other Maggi/ Nestle products.

MAGGI correcting its mistake:

The company failed to cash in on the success of Maggi Clubs. Further,discontinuation of the successful Maggi product and replacing it with a new



variant hit the company’s sales really hard. For the first time in years, Nestle sawits dominant position in the instant noodles market challenged by Indo-Nissin'sTop Ramen. In an attempt to rejuvenate the old Maggi, the company planned torelaunch Maggi through a planned sales promotion campaign.

Setting the ball rolling was the Maggi Fun-Dooz promotion and online contest.The promotion and contest were meant to take forward the `ab sab kuchh pehlejaisa' feel associated with the relaunch of Maggi noodles with the originalflavours.

ObjectiveThe Maggi Fun-Dooz promo was poised to drive the brand to new heights,reward loyalists, bring back lapsed customers and bring new consumers into itsfold.

PromotionFun-Dooz, as the nomenclature suggests, is a set of 16 `fun to do' and `great toplay with' three-dimensional puzzles which, when put together, could build upto a Toyland and `Zoomies': a dream house, a fast car or even a fighter plane!The Fun-Dooz puzzles are available with 400g packs of masala flavour Magginoodles. Completing the 16-piece puzzle first would fetch the winner a Fun-Dooz watch, while for anyone who manages to put together eight differentpuzzles, there are board games to be won. In the past, Maggi has given awaydinky cars and waist pouches as prizes in exchange of a set number of noodlespacks.

Supplementing the Fun-Dooz promo, is a Maggi-2-Minute Fun-Dooz contest onthe net (www.contests2win.com) lending a touch of modernity to thepromotions. A participant could win prizes such as music CDs on answeringthree questions correctly.

The company also has plans to rejuvenate the almost forgotten `Maggi Club' foryoung children. The club, which had a database of almost 2 million kids, sent outgames and puzzles to members in an effort to keep their interest in the brandalive.

ResultsAccording to company executives, sales have improved dramatically since theold flavour was brought back.



CATEGORY: OTC PHARMA

IODEX POWER CREAM

Iodex isn’t only a dark brown greasy stain-leaving balm, in an equally primitivebottle. It’s also a white, washable non-staining cream in a contemporary tube.Then why hasn’t the latter image replaced the former? SmithKline BeechamPharmaceuticals is working hard on that making the contemporary image of theage-old brand stronger.

The legendary Iodex in the green bottle contributes to about 90% of the totaliodex sales. But the power cream is showing only modest growth. The reasonbeing that Iodex Power Cream was a not-so-early entrant. Moov was already intotubes and quite established in the market. Creams are still in the nascent stagehowever. Today iodex and Moov are the only key brands available. HimaniCream was launched recently in the same segment.

In the past ten years, the category has clocked a growth of 3-5%. The cream, which SKBbelieved, would help category growth contributed just 3%. So this year they decided to dosomething different, which can actually trigger growth. A blind test done by the researchagency showed that the Iodex Power Cream was the preferred brand. So the companydecided that if the brand was good, they should stand by it. They came up with a money-back guarantee scheme quite unique in the OTC category.

TimingJuly 25th – September 30th

WhereTest marketed in Tamil Nadu and Karnataka. National launch in the first week ofAugust.

OfferThe money-back offer was exclusively for backache. (Though the product worksfor any kind of pain)

PublicityIn-shop promotion in Chennai and Bangalore and national advertising

Rationale



“Commercials do get noticed but are not very effective. A consumer feels goodwhen she can see the product, open it, smell it and apply it”

Story board:

A woman buying flowers isapproached by a salesmanselling Iodex Power Cream

The lady smiles and isconvincedabout the claims madeby thesalesman and agrees totry it out

"Kamar dard se pooraaaram dilaye,"the salesman says.Super: Fouranaaram, nahin to poorapaisa wapas.

But the salesman ispersistentso she loses her cool andasks him to "move."

"Woh nahin madam, yeh,"he says, referring to acompetitor brand.

But she is not interestedand politely refuseshim



Results

Power cream now contributes about 10% to the overall Iodex portfolio.

What the future holds?The company believes that if the cream segment moves, there will be a positiverub off on the entire Iodex brand.

PRODUCT CATEGORY: ORAL CARE

CLOSE UP v/s COLGATE

Close-up:

Its initiative ran under the banner ‘Sky Party with Hrithik Roshan’. This was apart of a nation-wide contest that commenced on Feruary14, 2001, with a finalscheduled on April 26, 2001.The contest culminated in Mumbai with a star-studded dinner and an airplaneride for 30 lucky winners with the famed film star on board. The idea wassimple. Consumers had to fill in some personal details on the inside of any close-up pack. The empty pack could be dropped in at collection boxes placed atconvenient locations in selected cities. A draw of lots determined the luckywinners who would be flown to Mumbai to participate in the Sky-Party.

Colgate:

For a long time in the paste wars (all through the early and mid 1990s) it lookedas if Colgate Gel could not match the power of the Close-Up proposition. SinceClose-Up was gaining increasing popularity because of its ‘Sky Party’ Colgatealso hit right back.It launched its ‘Colgate Ke Andar Kya Hai’ promotion that had been uniquelydesigned to reward consumers for every purchase they made under thispromotion, according to Colgate-Palmolive. The consumer had to cut-open the



wrapper and place a mirror against the inside of the pack to read what has beenwon. In the case of toothbrushes, the consumer has to scratch the silver pack onthe packing with a coin to find a gift. There were 10 first prizes of Rs.10 lakheach, 50 seconds prizes of Rs 1 lakh each and 100 third prizes of PC’s andPalmolive-Natural soaps. The prizes range included kids’ activity books andPalmolive skincare booklets with Rs.3 discount coupons.

ANALYSIS

Objectives of the promotions:

Close Up – objective of the promotion was to strengthen and connect withtoday’s youth.

Colgate – the promotion was launched with the objective of growing volume andmarket share and to compete with Close-Up in the fresh-breath segment wheregel pastes are a huge success and Close-Up was the market leader whiledelighting consumers with a hidden surprise in every purchase.

Medium of communicating the promotionsClose-up used a multi-media approach in reaching this contest to its consumers.Print, radio, TV and the Internet were used extensively to create visibility andexcitement, as also to encourage participation.

Colgate’s promotion was supported by outdoor advertising, TV and presscampaigns and a POP (point of purchase) support plan.

Pull Strategy/ Push strategyBoth of the companies used pull strategy that motivated the consumers to go tothe retail outlets and ask for their respective toothpastes. These promotionsrequired the minimum support from the retailers.

Types of promotionsClose-up used an event with a celebrity specially leveraging the popularity ofHrithik Roshan after the success of ‘Kaho Na Pyaar Hai’ as a promotional toolthat also included sweepstakes.Colgate used discount coupons, gifts, prizes and contests as the promotional tool.

ResultsThe efforts of both the companies paid off in terms of higher consumerinvolvement. This is a good example of how two companies in the same segment



used different promotional strategies to attract the audiences and in respect totheir brand images.The promotions also aimed at creating awareness in the rural market, where thepenetration of tooth-pastes is just about 42%. The consumption of toothpaste isabout one-third of the urban consumption. Companies have to find the linkwhich will make the market grow and this will come through the power of thebrand.



INCREASING READERSHIP – THE A&M EXPERIENCE

A&M, a magazine for advertising and marketing had launched a sales promotionscheme to give the much-required boost to its sales. The sales promotion schemewas advertised in the print media i.e. newspaper (Times of India).

OBJECTIVE

To increase customer base and readership.

ABOUT THE SCHEME

The scheme was an attractive subscription offer launched for the purpose ofincreasing the readership of A&M. the scheme offered heavy discount on thesubscription rates of the magazine for the periods of 1, 3, and 5 years. Not onlythis, the scheme also offered free gifts with subscriptions of 3 and 5 yearsduration. The free gifts included a Videocon Digital Organiser with a 5-yearsubscription and Braun pocket shaver with a 3 year subscription. The details areas follows:

Subscription

Term

No. ofissues

Newsstandprice

@ Rs. 50

You payRs.

Effectivesaving

Free gift

5 yrs. 120 6,000 1,995 66 % Videocon digitaldiary

3 yrs 72 3,500 1,395 61 % Braun pocketshaver

1 yr. 24 1,200 695 42 % -

OTHER HIGHLIGHTS OF THE SCHEME WERE:

25 early bird prizes of Videocon KT 3113 Walkies.Fabulous prizes to be won by lucky draw of all new subscribers. The prizesincluded Honda City cars, Holiday package to Goa and Mussourie, Videoconrefrigerators, washing machines, air conditioners, Toshiba Colour TVs, LMLscooters and Kenwood car music systems.The scheme also offered flexibility in the mode of payment for the subscription.The payment was accepted either in the form of cheques, demand drafts or creditcards. The delivery of the first issue, as well as the free gift was promised to bedone within 4-6 weeks of receiving the subscription form.



WHY WAS THIS SCHEME LAUNCHED?

The main reasons for launching the scheme was to boost the sales of thismagazine.The magazine at a price of Rs. 50 was perceived to be an expensive magazine. So,Spectrum Magazines Ltd. thought of introducing a special subscription offer forA&M. they realised that the customers would prefer to subscribe to an expensivemagazine if an attractive offer was placed in front of them.Secondly, its nearest rivals, Business Today, Business India, and Business Worldhad also launched their respective offers. So, to counteract this action, it becamenecessary for A&M to come out with their own subscription offer, much moreattractive than other magazines.Thirdly, A&M realised that it was the only magazine which specialised inadvertising and marketing and there was no close competitor for the same. So itcould easily snatch away the readers of those business magazines who foundA&M out of their normal reach.

SCHEME DURATION

The scheme was launched on the 6th of October 1998, and lasted till 15th

November 1998. The duration was of sufficient length; neither too short, nor toolong. This duration was proper because it gave the readers sufficient time tothink about whether to avail the offer or not. The scheme was launched keepingin view the festive season of Diwali when the consumers are keen to buy newthings or entering into new ventures.

OUR STRATEGIES FOR A RELAUNCH

As is common knowledge, A&M has shut shop. But, if due to some reason it decides torelaunch itself, we have the following sales promotion strategies for them:

Objectives

First of all we need to set the objectives. The main objective would be to inducethe original readers to continue, and broaden the base.

Target market

They would therefore be required to define their target market properly. Themain target market is a working executive in the field of marketing andadvertising.



Strategy

A&M first needs to reduce its price, because no amount of sales promotionwould work if the product were itself so expensive.Further, today all magazines offer discounts and free gifts, due to which theconsumers have actually got bored.In the first month or so, they should have these free gifts, so that people actuallywanting those free gifts would purchase the product. But after those sales havedried up, A&M would require to innovate its promotions.It could launch a ‘voracious reader scheme’, wherein at the end of eachmonth/fortnight, a competition would be held in which all subscribers would beinvited. This competition would include a quiz, a crossword, etc based on thecontents of the magazine of that month/fortnight. Plus they would write aboutwhat they learnt from that issue.The top 3 will be selected and their names would be published in newspapers,magazines, etc. in addition to giving away some free gifts.What the above strategy will do is not only increase sales, but also increasereadership. The root cause of discontinuation of subscription is that people don’tread and hence think it’s of no use subscribing. These competitions will urgethem on to read even when they are pressed for time.What this will also do is make people aware of the quality of articles appearingin A&M.Therefore, even if the scheme gets discontinued, readers won’t change becausenow they actually know what the quality of A&M is.



PRODUCT CATEGORY – CONSUMER DURABLES

GODREJ Vs SAMSUNG washing machines

Objectives

Godrej: to increase market shareSamsung: to combat competitors’ strategy and protect their market.

Type of scheme

Godrej

1. Customer promotion scheme

Here the customer is benefited.The company is following this scheme by giving rebate on the original priceof the product (it cut down the price from Rs. 14,999 to Rs. 13,000). It is alsogiving a free gift (a VIP suitcase) and special loans to its customers. It ischarging 0% interest loans for its products to the customers.

2. Trade promotion scheme

Here the middleman (retailer) is benefited.Godrej is giving 10-15% of the profit to the retailers if they are unable to meeta specific target.

Samsung

Customer promotion scheme.Samsung is giving rebates on the original price of the product (its fully automaticwashing machines worth Rs. 21,000 are now costing Rs. 18,000), and are also agiving a free gift (a camera).

COMPARISONS

Godrej Samsung

Loans 0% interest loan Not applicableFree gift VIP suitcase A cameraService More service points Limited service pointsPrice Less High



Product range Large - (semi & fullyAutomatic washing

machines)

Limited - (fullyAutomatic washing

machines)Result of scheme

Sales of Godrej went up by 70%.Sales of Samsung went up by 30%.

Analysis

The free gift of Godrej (the VIP suitcase) has more utility, is a necessity, and isrequired by all classes of people.Whereas, camera is a sort of luxury item and is required only by specific classes.Hence, the strategy of Samsung is that of a follower and they are playingdefensive.

Recommendations

Samsung should have had an exchange offer and contests instead of following Godrejand giving a free gift.The exchange offer would have attracted many second or third time buyers,more so because it is a foreign company.Contests would attract first time buyers who would like to have an experience whiledeciding.Moreover, product features do not differ much in this case and hence the finaldecision is influenced by sales promotions to an extent. It is here that Samsungshould have used their creativity and had a promotion, which would haveattracted both, first-time, and non-first-time consumers.

Recently they have come up with the ‘phod ke dekho’ and ‘phir se phod ke dekho’promotions, which are not run-of-the-mill. Even here, free gifts are being givenaway, but the important thing is that the promotion has been packageddifferently in the form of a plastic nariyal (coconut). Even the selection of thenariyal is significant because in India, there is a tradition of breaking a nariyalevery time something new and good is about to be commenced. It is a symbol ofgood luck.Thus, this has really caught on the fancy of many a consumer and sales havepicked up at a rapid pace.



CATEGORY – SERVICES – FAST FOOD INDUSTRY

DOMINOS

TARGET CONSUMER

A target consumer for Dominos is anyone who wants convenient food. Themajor consumers of pizzas in India are the Kids, Teenager and the youngworking class crowd. Dominos targeted these segments, however now they aretargeting “families” also. This is reflected in their current ads and promotions.Dominos targets all those who are pizza lovers and young at heart.

Competition:Dominos believes that every food outlet that exists in the vicinity of its own pizzaoutlet constitutes competition.

Objective:Increasing the appetite of an individual customer by providing incentive to buy alarger pizza.Expanding to target ‘families’ as consumers.Dominos introduces offers, schemes and launches new product variants everyquarter to ensure awareness among its customers and accomplishes its brandbuilding exercise.

Promotion:§ Free coupons sent as fliers that enable customers to save a certain amount of money

on their orders.Eg:Meal for twoBuy a medium 10 pizza with any one veg topping for RS 99<save Rs40>

§ The most recent scheme of Dominos is introducing garlic breadsticks free with everylarge pizza worth Rs.199 or more. This has also been advertised through televisionthat shows a family as the target audience for this scheme.

§ The neighbourhood of the week scheme . They identify a potential area wheredemand has not picked up yet, after which they concentrate on the selected area andensure increased sales through various promotions.

§ They have a customer loyalty programme whereby they maintain a database of theirregular customers and keep them informed of all the new schemes, discountoffers,etc. They are also sent discount coupons through direct mailers which acts likea reward to the star customers and delights them.



§ Dominos had another offer which was called the U-buzz offer which was a tie-upwith AirTel.

DOMINOS – SALES FORCE PROMOTIONSDominos inculcates the core values of the company into its salesmen andprovides them with a lot of incentives which help them push the group.

When a new store is opened, Dominos has certain opening incentives where they set abenchmark on the basis of expected sales (average weekly unit sales) and once the store

achieves this target, the store manager gets a reward of $500.

• International and National Level AwardsThese incentives can be termed as attractive because they actually are givento the selected few who have excelled in some area and are then rewardedat an international conference and they are rated not just within theircountry but on an international level. For instance say ‘The Manager of theYear’ will have nominees from all over the world and the person gettingthis title will have earned it out of 7000 outlets the world over.

• There are 4 levels of challenges (each of them) stretching through a 13 weekperiod at the end of which the sales are compared to those of thecorresponding period of the previous year.§ Silver Challenge

This challenge requires a store manager to achieve a 25% increase insales and if he manages to do so then he is awarded the silver cap andpockets a cash prize of 250$.

§ Golden ChallengeThis challenge requires a store manager to achieve a 50% increase insales and if he manages to do so then he is awarded the silver cap andpockets a cash prize of 500$.

§ Platinum Challenge Here the percentage expected is 75% and the cash prize increases to

750$

§ Diamond ChallengeHere with an expected increase of 100% this becomes not only thetoughest challenge but also the most coveted one.

As we can see, with all these challenges the status goes on rising and sodoes the cash incentive. Other than this the person receives international



recognition through acknowledgements meted out to him in the“Pepperoni Express”. In case of the award category “Rookie Manager ofthe Year” the person selected wins a trip to Las Vegas and Miami.

Incentives at the Local Level:• For each store manager his store is his “baby” and he has staff welfare fund

allotted to him and the store manager has got discretion to use this budget.He uses it as a “carrot” theory to improve the productivity of the teammembers. He could do this in the form of free movie tickets or free pizzasetc.

• Pins and badges are awarded to team members recognizing theirachievements.

• They have various ‘star ratings‘ for different stores. Owing to this everystore puts in their best to acquire the ‘five star rating’.

Medium of communication-Dominos believes firmly on the principles of direct marketing. The area ofoperations of a Dominos outlet is restricted and hence mass advertising does notbenefit it in any way in the sense that any leads generated as a result of it shall benullified as it will not be able to service such orders that are outside its purview.Therefore it Communicates with its customers through

• Sponsorships at festivals,• Sachin VISA tie-up,• Fliers• door hanging• Media for brand building - TV, Times of India• VISA• ABN AMRO• Cartoon Network• Jet Airways

The core promotional activity performed is door hangings. They have a uniquedesign and each hanging is complete with its own set of schemes and offers tolure the customers.

The task of reaching the hangings to every house is done between 1-3’o clock; during thetime when the number of orders are minimal. It is ensured that every house in the localityis covered and no stones are left unturned in reaching the fliers to the houses of theregular customers, if not all the people of the area.



Results-The store manager of Dominos claims that after the launch of promotionalscheme there is a substantial increase in sales.The most recent promotion i.e the garlic bread offer saw an increase in sales tothe extent of 45%.

CATEGORY – WEBSITES

INDYA.COM

Objectives-Build the brand, get consumers online and make them come again and again toIndya.com.

Type of promotions-§ Offline promotions are as important as online promotions to indya.com in

order to build affinity to the brand as customers only interact with brandsthat they have faith in. hence promotions were carried out at various accesspoints-TV, print, outdoors, on-ground and retail.

§ Promotions with Cyber cafés-About 50% of Internet access in India is from cyber cafés. To capitalise on this,indya.com has tied up with 950 cyber cafés (called indya cafes) across the country.These cafes are highly suitable for promotions. This has mutual benefits says NeetiChopra, vice-president, alliances, Indya.com. “Indya.com drives traffic to the cafes,which in turn provide a place for access to our site. Indya.com is the defaulthomepage in these cafes.

§ Online promotions- Pioneered the concept of online movie promotions in India.

What were the promotions about?Offline-For on-ground and retail promotions, we have signed up with Delhi basedkidstuff.

Cyber cafes-They have promotions targeted at free owners, like a free holiday for the owner of thebest done up cafe. Indya.com's Christmas promotion for instance was one wherein youcould win prizes if 'Santa singh' caught you surfing the indya.com website at any of theIndya cafes.



Online promotions-§ Launched J.P. Dutta's 'Refugee' in July 2000. Created Refugee.indya.com

where they gave insight into the movie and brought in consumer experience."A similar, but more interactive, promotion followed withMissionkashmir.indya.com.

§ For the first Independence Day of the new millennium, the portal launched"Meri Marzi freedom poll" where users could vote for their choice of events,institutions, personalities, news and other topics that have had an impact onIndia post independence.

§ During the Olympics, the portal launched a new channel Olympics to letusers participate in interactive games and quizzes.

§ Some promotions were done in association with a couple of its partnerchannels namely jobsahead.com and apnaloan.com. 'Smart Cv contest' inOctober 2000 was a promotion wherein 15 candidates with the best resumeswon an interview with one of the top five companies in India.

§ Likewise, 'Become Lakhpati' was a promotion whereby any use of the rightfour and quarter credit card on indya.com qualified for a lucky draw with aprize of Rs one lakh.

Pull or Push Strategy ?The company has used an efficient mixture of pushing the portal through cybercafes and pulling the customers towards the portal through their offline andonline promotions.

Their concept behind the promotion-Says Chopra," our promotions are very simple. But we build usefulness intobrand, which in turn brings stickiness on the site. The idea and execution ofpromotions reflect the weight and wisdom of indya.com. We learn from everypromotions and are able to fine-tune the next ones."They enable everyday usefulness so that users keep coming back. The First day,they may come for promotions. The next day they may come to read newspopulist property for sale. They offer 44 products and services on-linetransaction oriented promotions or for various conveniences.'

Results-Success on the Internet is based on unique brand building and Indya.com hasbuilt the essence of it being a great brand through its promotions. It relates to theethnicity of India and has a vibrant attitude.These promotions, the company claims have helped high brand recall forindya.com in the Indian Internet space



INDUSTRIAL PRODUCTS

Generally for industrial products the kind of sales promotions done arementioned below.

Volume discounts:On purchase of products over a ceratin quantity the custmer is given discountswhich vary from product to product and company to company.

Loyalty programs:This are a very important part of industrial products. This is because once acompany starts buying a particular product form a particular company they stickto that. Hence it is necessary to reward consumer loyalty.

Seminars and Conferences:

Seminars and conferences are a very important part. Most of the times gettingthe consumer id done through seminars. For eg. A cement manufacturer fotenorganizes seminars to educate the consumer about the product.

Microsoft Corporation (India) Pvt. Ltd.

Promotion: Microsoft Windows XP launch-October 2001Objective: to make people aware of Windows XP operating system in IndiaCity: Mumbai, DelhiStrategy: From 10 days before the actual event, kiosks were set up all over the city toinvite people to use XP for themselves. They were the quizzed on the same, and uponanswering correctly, they were given free consumer passes to mega-event the launch.In Delhi, Ansal Plaza’s amphi-theater and Mumbai’s Nehru center was converted into amini Consumer-expo with stalls of Compaq, Intel, Hewlett-Packard, Sony, HCl, andNIIT apart from the main windows XP stall, games and activities were held inside these,along with live demonstrations of XP features. This was a 2-day event and crowdsthronged the venues on both days.

SmithKline BeechamPromotion: boost enerhgizerObjective: To promote Boost sachet in offices.City: Delhi, Mumbai, Chennai, Kolakatta, Hyderabad, BangloreStaretgy: An extensive sampling promotion was undertalken for the boost energizersachet drinks in offices. Salesforce teams visited offices and personally handed over thesample packs to the staff.



PROMOTIONS

TEMPTATIONS

Just one year after its launch in September 2001, Temptations hasalreadymanaged to garner a3% volume market sahre in the 9000 tonne or Rs. 550 croremarketin India.

But the compnay realised just launching a revolutionary would not be sufficient,it had to be backed by extensive promotions and advertising to ensure itssuccess.

Objective: To induce trials and increase market share

Promotions:Numerous promotions and online contests were launched for the purpose. Thebudget fixed for promotions were 1.5 crore.

Cadbury’s tied up with ICICI bank ATM’s and Teatres for its advertisements.

300 bars of temptations were given in a promotion in association withCrossroads where in on a purchase upto a certain amount a free Temptationswas given.The firm alos identified 60 upmarket restaurants where 80-100 bars oftempatations were given away.

The firm tied up with Star network to launch online contests§ “Tempting Treats”

The customer had to log on to www.temptationsworld.com click on the Star logoand then answer a question based on the Star programme. The contest happenedbetween Feb2001 – April 2001.The bumper proze for the winner was A ford Ikon .

§ “Sweet Surprises”

The contest could be entered through internet or SMS. The winners would getatrip for 2 to Australia.

SAMSUNG DABAKE JEETO OFFER:

http://www.temptationsworld.com



Digital technology leader, Samsung India Electronics Ltd., has launched a megapromotion for the forthcoming Soccer event, called ‘Samsung Dabaake Jeeto’ Offer.

Objective:

Targets Rs.310 Crores worth of Sales from this Promotion

Timing :This Promotion was live in West Bengal on May 1, 2002 and All India on May 10, 2002was valid uptil June 30, 2002.

Promotion:During the duration of the promotion, every Samsung Consumer Electronics orHome Appliance product purchased by a customer entitled him/her to a SureShot Alarm Clock from Samsung. The Alarm Clock waspacked in a PlasticFootball that was given to the Customer at the time of purchase. On pressing theFootball from the top, the customer gets the Sure Shot Alarm Clock and if he/sheis lucky, they will find a tamper proof anodized sticker of the gift on the clock.The customer wins the gift etched on the sticker. This Promotion had gifts worthRs.10 Crores for the customer and the Dream Prizes for customers includedSamsung Digital Flat TVs, Frost-free refrigerators, Microwave Ovens, KarismaWashing Machines, Mobile Phones, Cameras and Soccer 2002 Official licensed T-Shirts from Adidas.

The total cost of this consumer promotion was Rs.15 Crores, including the Gifts.The Company released new print and television commercials around thisCampaign and carried out ‘In-Shop Hungamas’ at select dealer counters inKolkata, Goa and Cochin to create visibility for this Campaign.

“Samsung Dabaake Jeeto Offer has been launched with the objective ofstimulating the market and optimizing the sales of our products during the

forthcoming Soccer season states Mr. R. Zutshi, Vice President Sales, SamsungIndia



CINTHOL :

Cinthol celebrates 50 years of skincare with exciting promotional offers Cintholcelebrates 50 years of skincare this August. India's first deodorant andcomplexion soap was launched on 15th August, 1952 and in these 50 years of thebrand has crossed many glorious milestones.

The flagship brand of Godrej Consumer Products Limited, Cinthol is celebratingits month long Golden Jubilee with exciting offers for both the trade and theconsumers.

For its consumers, Cinthol has launched a special Golden Jubilee offer cartonpack of three soaps. The offer is valid only on the Cinthol deodorant andcomplexion soap. The special offer pack is in the striking original red colour ofCinthol and is priced at Rs.50. The offer is available all across the country.Cinthol has also launched a "Stock And Win" Golden Jubilee trade scheme inwhich stockists can win a number of prizes including Cinthol gold coins anddiamond rings

GODREJ FAIRGLOW:

Godrej FAIRGLOW, the unique fairness brand from Godrej has announced thelaunch of its VALENTINE SPECIAL on its website www.fairglow.com February6, 2002, Mumbai : The VALENTINE SPECIAL is featuring a host of offers &activities to satisfy the needs of young couples. The most amazing offer is theSEND A ROSE promotion, whereby consumers have the chance of sending arose FREE to their valentine alongwith their message. Also, consumers canparticipate in the very interesting 'Fairglow - Catch the Queen of Hearts' contestand win Rs. 1000 everyday.

The VALENTINE SPECIAL also features interesting ideas like the Love -greetings and E- kisses section where users can send these beautiful cards to theirvalentine, the Dr. Love & Astro Love calculators where they can find out moreabout their partners and the very interesting Love Poll. Users can also downloadamazing wallpapers, love stationery and screensavers from the site.

http://www.fairglow.com

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