Free AIOU Solved Assignment Code 439 Spring 2021
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Course: Advertising and Sales Promotion (439)
Semester: Spring, 2021
ASSIGNMENT No. 1
- 1 Describe modern viewpoints on promotion with examples. Also explain the various categories of promotional media in Pakistan.
Promotion is an attempt by marketers to inform, persuade, or remind consumers and B2B users to influence their opinion or elicit a response. Most firms use some form of promotion. Because company goals vary widely, so do promotional strategies. The goal is to stimulate action from the people or organizations of a target market. In a profit-oriented firm, the desired action is for the consumer to buy the promoted item. Mrs. Smith’s, for instance, wants people to buy more frozen pies. Not-for-profit organizations seek a variety of actions with their promotions. They tell us not to litter, to buckle up, to join the military, or to attend the ballet. (These are examples of products that are ideas marketed to specific target markets.)
Promotional goals include creating awareness, getting people to try products, providing information, retaining loyal customers, increasing the use of products, and identifying potential customers, as well as teaching potential service clients what is needed to “co-create” the services provided. Any promotional campaign may seek to achieve one or more of these goals:
- Creating awareness:All too often, firms go out of business because people don’t know they exist or what they do. Small restaurants often have this problem. Simply putting up a sign and opening the door is rarely enough. Promotion through ads on social media platforms and local radio or television, coupons in local papers, flyers, and so forth can create awareness of a new business or product.
Large companies often use catchy slogans to build brand awareness. For example, Dodge’s wildly successful ads where a guy in a truck yells over to another truck at a stoplight, “Hey, that thing got a Hemi?” has created a huge number of new customers for Dodge trucks. Hemi has become a brand within a brand. Now, Chrysler is extending the Hemi engine to the Jeep brand, hoping for the same success.
- Getting consumers to try products:Promotion is almost always used to get people to try a new product or to get nonusers to try an existing product. Sometimes free samples are given away. Lever, for instance, mailed over two million free samples of its Lever 2000 soap to targeted households. Coupons and trial-size containers of products are also common tactics used to tempt people to try a product. Celebrities are also used to get people to try products. Oprah Winfrey, for example, recently partnered with Kraft Heinz to launch a new line of refrigerated soups and side dishes made with no artificial flavors or dyes. Kate Murphy, director of strategic partnerships at the social marketing platform Crowdtap, weighed in on the strategy. “Celebrity endorsements can provide immense value to a product/brand when done right,” Murphy said. “If a celebrity aligns with a product, they bring a level of trust and familiarity to the table.”
- Providing information:Informative promotion is more common in the early stages of the product life cycle. An informative promotion may explain what ingredients (for example, fiber) will do for a consumer’s health, describe why the product is better (for example, high-definition television versus regular television), inform the customer of a new low price, or explain where the item may be purchased.
People typically will not buy a product or support a not-for-profit organization until they know what it will do and how it may benefit them. Thus, an informative ad may stimulate interest in a product. Consumer watchdogs and social critics applaud the informative function of promotion because it helps consumers make more intelligent purchase decisions. StarKist, for instance, lets customers know that its tuna is caught in dolphin-safe nets.
- Keeping loyal customers:Promotion is also used to keep people from switching brands. Slogans such as Campbell’s soups are “M’m! M’m! Good!” and “Intel Inside” remind consumers about the brand. Marketers also remind users that the brand is better than the competition. For years, Pepsi has claimed it has the taste that consumers prefer. Southwest Airlines brags that customers’ bags fly free. Such advertising reminds customers about the quality of the product or service.
Firms can also help keep customers loyal by telling them when a product or service is improved. Domino’s recently aired candid advertisements about the quality of their product and completely revamped their delivery operations to improve their service. This included advertisements highlighting a Domino’s pizza being delivered by reindeer in Japan and by drone in New Zealand. According to University of Maryland marketing professor Roland Rust, “delivery” stands out in how Domino’s has broadly improved its quality, and “the customized delivery vehicles are a competitive advantage.”
Print Media e.g.
Newspapers and magazines with easy conditions of entry for publishers and editors, without differentiation between authentic, credible print media and on the other, a large number of “dummy publications”. Both types enjoy high levels of freedom of expression and in many instances also receive substantial benefits from Government-controlled advertising, irrespective of whether a newspaper is a genuine newspaper with a credible level of circulation or it is a merely token, ceremonial publication whose circulation may not exceed 100 or 500 copies a day but, because of corrupt practices, receives larger volumes of Government-controlled advertising.
In contrast to the ease of entry into publication for print media, the entry criteria into the electronic media sector are more exacting and more expensive i.e. the need to meet the eligibility criteria specified by PEMRA, the costs of obtaining a license e.g. Rs.5 million, the costs of equipment and satellite broadcast facilities, the relatively high cost of operating a news channel (whose content cannot be re-sold or repeated unlike the content of an entertainment channel) etc. In the print media sector there is no longer any State-owned daily newspaper or magazine. But in the electronic media sector, there are PTV and PBC, both of which receive large sums of money from the public (the TV license fee for PTV) and funds for projects from the Public Sector Development Programme (PSDP) and the public exchequer e.g. PBC, which receives over 90 % of its revenue as grant-in-aid.
Perhaps the easiest sector for entry and the easiest to operate in, at the lowest cost, because even a single individual with a computer and Internet connectivity can maintain a website or a blog. The evolution of Face book, Twitter, and other dimensions of the Internet have also made it the most participative mass medium with optimal access, except for phases where YouTube is blocked.
Classical Media and Below-the-Line Media
Classical media, theatre, books, cinema. Below-the-line media: outdoor billboards, posters, handbills, displays, banners, etc. Each of these is not a conventional news medium and each of these is governed by different laws and mechanisms at the Federal and now increasingly, at the Provincial levels.
AIOU Solved Assignment Code 439 Spring 2021
Q No.2 The fundamental purposes of sales promotions are to argument, support, and assist the promotional effort being conducted on print and assist the promotional effort being conducted on print and electronic media. Describe the concept and purpose of sales promotion with appropriate examples.
Sales promotion is a set of marketing technologies aimed to stimulate the demand in particular products and increase brand awareness. Limited in time, it creates a feeling of time-sensitiveness, generates new leads, and keeps existing customers engaged.
- It helps to generate new leads. Sales promotion can boost your product image since it encourages sharing information about it within social groups related to your business. If you sell training football shoes, people keen on playing football will share the message.
- Allows re-engaging with your existing audience. Once a person subscribed to a brand’s email newsletters, they will receive regular sales promotions. It is a way to keep the audience engaged and maintain a close connection with the company, which is crucial for building loyalty.
- Skyrockets revenue. Sales promotions help companies to increase the number of sold goods, even though they need to lower the price to achieve that goal. Of course, merely reducing the price is not enough, people should need your product, while the discount is only another reason to make a purchase.
- Increases brand awareness. Sales promotion is a way to make a name for your brand because people are more likely to talk about a сompany that proposes benefits and saves their money. That’s what sales promotion does.
Although the main goal of sales promotion is to increase demand in a particular product, you can reach several important goals. Understanding them will help you create an effective promotion strategy.
- Launch a new product. If you’re going to expand and turn your small coffee shop into a bakery, you need to reach new market segments. You can attract new customers by offering a free cookie with each cup of coffee or suggest visitors set their own price once in a while.
- Attract new clients. This objective should be your long-term goal since it allows your business to grow. Your potential clients are likely your competitors’ customers, so analyzing their product and benefits, you can offer something more valuable.
- Stay competitive. Researching and analyzing your competitors will not only help you attract new clients but constantly improve your product and customer service.
- Make existing customers buy more. It’s always easier to make an existing customer buy more than attract new clients. Provide each client with a personalized approach — it will help you build customer loyalty. As a result, clients will promote your brand organically.
- Sell during the off-season. Goods like swimwear, boats, tents, air conditioners, refrigerators are definitely more popular in summer but you should consider special strategies to sell them throughout the year. Offer time-limited discounts, “1+1=3” campaigns, and other marketing tricks.
- Run clearance campaigns. They’re especially popular before summer and winter. As dealers need to make room for a new collection, they often run total clearance campaigns when users can buy goods from old collections at extremely reduced prices.
There is a variety of ways to run a successful sales promotion, but let’s focus on some most frequently used ones, using a cup of coffee as an example.
- Price deal. It is a temporary cost reduction, for instance, 20% off for a coffee for a week.
- Loyalty reward program. This means that customers collect points or credits when they buy coffee. If they get 10 points, for example, they will have one coffee for free.
- Bonus-pack deal. It means that a customer can get more products paying the original price. For instance, they pay a dollar for one cup of coffee and get free candy, which gives some positive emotions and makes them come back in the future.
- Giveaways. These tactics aim to increase brand awareness. It means giving some items for free in exchange for personal information to use in further marketing. For example, offer a free cup of coffee in exchange for a phone number, which you can use for many purposes: promoting new sales, sharing updates and news with short text messages, etc.
- Coupons. You can sell coffee for the original price and give a coupon, which will make the next purchase 5% cheaper.
- Mobile couponing. It stands for coupons received on mobile phones via SMS. To get a discount, a customer needs to show the coupon on their smartphone.
- Sampling. Choosing this promotion type, companies give a sample of the product; for instance, the first cup of coffee to promote a new taste.
You’ll see some popular techniques as well as less used methods that will help you increase sales without much effort.
- Discounts. This technique is as old as the hills. Small companies and big corporations use this method to sell more. One of the reasons it’s so popular, even today, is that discounts are great for both consumers and retailers. Sellers can clear room in their warehouse for new arrivals and customers can buy more at reduced prices. Keep in mind that a normal discount should be between 5-20% since clients won’t even notice less than 5% discount, but more than 20% off will make them feel suspicious about your brand.
- Time-limited offers. This technique works even better than a big discount. With this trick, marketers manage to create a sense of urgency and fear of missing out on their products. You can give clients 24 hours to grab this special offer. To make this technique perform better, you need to advertise your promotion on each channel you use. This will bring more sales and increase your site traffic.
- Seasonal promotions. People often buy ski suits in summer and air conditioners in winter to save money. Selling products during off-seasons can be a real challenge, so we strongly recommend you to run seasonal promotions. Sell items from old collections at reduced prices and don’t forget to advertise your campaign via email and social media.
- “1+1=3″. “Buy one and get one for free” and “Buy 2 items and get the third one for free” are very familiar marketing tricks. Such campaigns help you sell products at a low price or save money shopping together with a friend. Retailers can significantly boost sales with this technique reinforcing clearance sales.
- Holiday promotions. Christmas, New Year’s Eve, Halloween, International Women’s Day, and Valentine’s Day are great chances to skyrocket sales. People are extremely generous when buying presents for their friends and family. Launch your holiday campaigns in advance, and invest in advertising via email, PPC, social media, and other channels. This will help you increase brand awareness and site traffic.
- Gifts. Who doesn’t like freebies? If you are a startup or about to launch a new product, go for this technique. It will help you reach big audiences fast, build brand recognition, and collect user-generated content which is especially valuable for every type of business. Let users try your service for free for 7 days, launch a campaign that will let each client who spends $100+ receive a gift, or give away free samples with each order.
- Contests. Competitions are a great opportunity to boost user engagement and increase brand awareness and sales. You can let your audience to create a slogan for your brand, a new advertising message, design, or share creative ideas on how to use your product in an unusual way. Make sure that the prize correlates with the effort spent on participating in your contest.
- Reward points. You definitely should reward clients who buy from you regularly – people love brands that appreciate their choice. So, with this technique, you can start building customer loyalty. Give points to each client who makes a second purchase or spends a certain amount of money. Then, let them exchange those points for a product they like.
- Special prices. Marketers usually run a 1-day campaign when users can buy everything at a fixed price. These prices usually look tempting for users and they can’t overcome the feeling of missing out. The goal may be an annual clearance of goods. You can set a fixed price for each product category of your store. For example, sweaters for $5.99, jeans for $9.99, coats for $15.99. This technique works.
- First-purchase coupons. It always takes time for people to give money to a new store especially when buying expensive products. To make them think over the purchase faster, offer a special incentive. You can send a welcome email to a new visitor with a coupon to get a 10 or 15% discount off their first purchase. For better performance, limit this appealing offer to a couple of days.
- Free shipping. Very often users leave your site without buying just because of expensive delivery options. To win back these potential clients, you can run a time-limited campaign that allows them to receive their orders for free if they spend a certain amount of money. If you sell medium-priced goods, do not make this fixed sum too high. Otherwise, people won’t fall for this trick.
AIOU Solved Assignment 1 Code 439 Spring 2021
Q No.3 What are the various specific techniques practiced under point-of-sales promotion? Explain these techniques with examples.
Everything you need to know about the methods of sales promotion. Sales promotion is needed to attract new customers, to hold present customers, to counteract competition, and to take advantage of opportunities that are revealed by market research.
Methods used in sales promotion include coupons, samples, premiums, point-of-purchase (POP) displays, contests, rebates, and sweepstakes.
For a marketer resorting to sales promotion, a variety of tools and techniques are available.
Sales promotion letters, catalogues, point of purchase displays, customer service programmes, demonstrations, free samples, discounts, contests, sweepstakes, premiums and coupons are the commonly employed methods of sales promotion.
Some of the methods of sales promotion are as follows:-
- Consumer/Customer Promotion Method 2. Trade Promotion Method 3. Combined Promotion Method 4. Sales Force Promotion Method 5. Rebate 6. Discount 7. Partial Refund 8. Free Samples
- Quantity Gifts 10. Product Combination/Bonus Offer 11. Packaged Premium 12. Prize Contest 13. Lucky Draw 14. Trade Fairs and Exhibitions 15. Word – of – Mouth Promotion 16. Telemarketing and a Few Others.
Sales Promotion Methods, Tools and Techniques
Sales promotion is needed to attract new customers, to hold present customers, to counteract competition, and to take advantage of opportunities that are revealed by market research. Methods used in sales promotion include coupons, samples, premiums, point-of-purchase (POP) displays, contests, rebates, and sweepstakes.
- Free Sampling – Consumer gets one sample free, after their trial and then could decide whether to buy or not, this helps in boosting sales.
- Offer of Price discounts/price deals – A temporary or seasonal reduction in the price, such as flat 50% off, is a good technique of attracting customers.
- Money back and Rebates – Consumers are offered money back if the receipt and barcode are mailed to the producer.
- Loyal customers Reward Points – Consumers collect points, miles, or credits for purchases, and redeem them for rewards, gifts or money.
- Price-pack/Bonus packs offers – The packaging offers a consumer a certain percentage more of the product for the same price for instance, ’25 percent extra’, ‘10% extra’, is seen mostly on goods. In yet another type of deal a customer is offered two products for the price of one.
In this scenario, bonus pack is disguised as a gain because buyers believe that they are obtaining a free product, though bonus pack is often wasted and is viewed as a “loss” for the consumer as the customer may not want the free product that came along with the purchase.
- Gift Coupons or cash back coupons – coupons have become a standard mechanism for sales promotions. Many times the discount coupon issued can be redeemed on the next purchase only.
- Mobile couponing – Coupons are available on a mobile phone. Consumers show the offer on a mobile phone to a salesperson for redemption.
- Loss leader policy – the price of a popular product is temporarily reduced below cost in order to stimulate other profitable sales.
- Free-standing insert (FSI) – A coupon booklet is inserted into the local newspaper for delivery, though it may not give the real benefit as mostly customers do not carefully see the pamphlets or stickers in the newspaper.
- Attaching a small sample in the leading newspapers – especially on weekends or holidays, many companies stick their free samples such as a shampoo pouch as a sales promotion gimmick. In fact this gets noticed and the consumer feels happy on receiving a small gift like this.
Methods of Sales Promotions – Involving the Store/Outlet:
- Dump bin – this is a very popular method with big stores or Big Bazarr where bins full of products dumped inside are kept at various strategic places in order to attract attention.
- Aisle interrupter – A sign is put up which juts into the aisle from the shelf.
- Dangler – in order to make a customer take notice, a sign is hanged that sways, every time when a consumer walks by it.
- Glorifier – A small stage is usually built that elevates a product above other products and glorifies it.
- Wobbler – it is a sign that jiggles or wobbles and makes the kids, in particular, feel very good about it. Many big departmental stores keep it as a sales promotion gimmick.
- Lipstick Board – Aboard is built on which messages are written in crayon. This also is an eye catcher and attracts attention.
- Necker coupon – A coupon placed on the ‘neck’ of a bottle indicating that the particular brand or a particular size has a scheme on it.
Trade Sales Promotion Techniques:
- Trade contest – A contest is organized with an intention to reward retailers who have sold big quantity of the product.
- Offering Trade discounts – These are payments to distribution channel members for performing a particular function or achieving a certain target.
- Trade credit period – a bigger trade credit period is offered to the most loyal and big dealer as an incentive.
- Point-of-purchase displays – this technique is used to create the urge of “impulse” buying and selling the product on the spot.
- Training programs – dealer employees are trained in selling the product and usually the training programme is kept at attractive destinations.
- Push money or extra commission – it is also known as “spiffs” wherein extra commission is paid to retail employees to push products.
- Trade allowances – this refers to short term incentive offered to induce a retailer to stock up on a product.
- Dealer loader – An incentive given to induce a retailer to purchase and display a product. This is the reason we see some products displayed by the store some better products may not be seen.
- Trade shows – Thousands of manufacturers display their wares and take orders at trade shows. Trade shows provide unique opportunities. First, trade shows provide a major opportunity to write orders for products. Second, they are a chance to demonstrate products, provide information, answer questions, and be compared directly with competitors.
- Sales meetings – Sales meetings are usually sponsored by manufacturers or wholesalers. Whereas trade shows are open to potential customers, sales meetings are targeted to the company sales force and/or independent sales agents. These meetings are usually conducted regionally and directed by sales managers and their field force, to explain the product or the promotional campaign, or simply to answer questions.
A fence sitter is a consumer who remains neutral or undecided amongst various alternative products. Such a consumer can be motivated to jump on the side of the marketer through effective advertising.
Brand switching is also known as brand jumping, brand switching is the process of choosing to switch from routine use of one product or brand to steady usage of a different but similar product. Much of the advertising process is aimed at encouraging brand switching among consumers, thus helping to grow market share for a given brand or set of brands.
Methods of Sales Promotion – Consumer/Customer Promotion Methods, Trade Promotion Methods, Combined Promotion Methods, Sales Force Promotion Methods
For a marketer resorting to sales promotion, a variety of tools and techniques are available. Sales promotion letters, catalogues, point of purchase displays, customer service programmes, demonstrations, free samples, discounts, contests, sweepstakes, premiums and coupons are the commonly employed methods of sales promotion.
1. Consumer/Customer Promotion Methods:
The consumer promotion methods of sales promotion are the methods which directly encourage consumers to buy the product in more and more quantity.
These methods may be as follows:
(i) Distribution of Free Samples:
Under this method, the producer distributes free samples of the product to consumers. They are also given to introduce a new product and expand the market. It increases the sales volume when the product is new to customers. It is an effective device when the product is purchased often, i.e. soaps, detergents, tea, coffee etc.
It is a method of demand creation. Sampling gives a change to consumers to compare products with other substitutes. Samples are given to doctors by medical representatives. The specimen copies of books are given to teachers. The idea behind this is that they recommend these products for use to patients or students.
Coupons are supplied along with products. A coupon is a certificate that reduces a price. When a buyer gives a) coupon to the dealer, he gets the product at a lower price (Regular price is Rs.100; with a coupon it may be Rs.80). Coupons (same as money) are accepted as cash by retailers.
Coupons normally perform two specific functions for the manufacturer. Firstly, they enthuse consumers to exploit the bargain. Secondly, they serve as an inducement to the channel for stocking the items.
The manufacturer thus succeeds in attracting consumers as well as in prompting the channel to stock the merchandise by introducing coupons. They are useful for introducing a new product as well as for strengthening the sale of an existing product.
According to John F. Luick and Zieglar, “A coupon is a certificate that when presented for redemption at a retail store, entitles the bearer to a stated saving on the purchase of a specific product.”
(iii) Price Reduction or Price off Promotion:
It stimulates sales during a slump season. It gives a temporary discount to the consumers, i.e. goods are offered at a rate less than the labelled rate. Fans are sold at a reduced rate in rainy and winter seasons.
For example, Hawkins pressure cookers have come up with several sales promotion schemes during the last few years.
For sales promotion different contests are conducted by producers.
According to John F. Luick and W.L. Zieglar, “A contest is sales promotion device in which the participants compete for a prize or prizes on the basis of their skills in fulfilling a certain requirement, usually analytical or creative.”
In these competitions questions are put to customers. Sometimes pictures are printed to test the general knowledge of customers and they are asked to give the detailed description of these pictures. No fees are charged from customers for participating in these competitions.
But they have to send the empty packets of the product, cash memo, prescribed entry information form and necessary information. The purpose of these competitions is to find prospective customers and to circulate a new product.
It is the instruction to educate consumers in the manner of using the product. It is a promotional tool to attract the attention of consumers. When products are complex and of a technical nature, demonstration is necessary, e.g., computers, field machinery, electrical pumping set, etc. Demonstration is done in front of consumers for mixer, wet grinder in retail shops, etc.
Premium method is also used to attract the consumers towards the product. In this method, consumers are provided some other useful product freely along with the purchased product. This is an effective method which is practised today for sales promotion.
The purpose of giving premium is to motivate new customers. But its main purpose is to induce the old customers of that product. According to George Christopolous, “A premium is an item of merchandise that is offered at cost or at relatively low cost as a bonus to the purchases of a particular product.”
According to Alfred Gross, “A premium is an article of merchandise or other thing of value offered as an inducement to purchase a product or service.”
The article of premium is packed in that packet and information is written that packet contains some article. Sometimes the information regarding premium item is printed on the packet or customers are directed to collect the premium item from the shopkeeper. Sometimes, there is a coupon inside the packet which is returned to the shopkeeper and premium item is collected.
(vii) Money Refund Offers:
It is the most important method of sales promotion. If the purchaser is not satisfied with the product, money is refunded. It is stated on the package. It creates new users and strengthens brand loyalty.
(viii) Fairs and Exhibitions:
India is a country in which various fairs and exhibitions are organized in different times. These fairs and exhibitions are organised on local, regional, state, national or even at international levels.
Businessmen and manufacturers take part in these fairs and exhibitions and display their goods. Since these fairs and exhibitions are visited by a large number of persons, businessmen and manufacturers get a good opportunity for advertising their goods.
(ix) Special Prizes:
Under this method, every purchaser of the product is given a prize coupon during a certain period. All the coupons distributed during this period are put into a box and a lottery is drawn therefrom. Winners are given some attractive prizes. Thus, this scheme also lures consumers to purchase and use the product.
(x) Aftersales Service:
Under this method, the producer gives a guarantee to customers to maintain the product for a certain specified period. Aftersales service and warranty increase the sale of the enterprise.
2. Trade Promotion Methods:
Trade promotion methods are also known as dealers’ promotion methods. These include all the methods which are adopted with a view to encouraging dealers and distributors to purchase and resell the product in more and more quantity.
Dealers’ promotion methods include the following methods:
This method is aimed at stimulating and motivating distributors, dealers, sale-staff, etc. This is an indirect way of boosting sales. This type of contest is conducted at the level of retailers and wholesalers. This is in the form of window display, store display, sales (volume), etc. A prize is awarded for the outstanding achievements.
(ii) Buying Allowance Discount:
Buying allowance discount increases the sale of the manufacturer and the profits of the dealer. The buying allowance or discount may be given at a fixed percentage on each minimum quantity of the product purchased during a stated period of time.
A premium is an article of merchandise or other thing of value offered as an inducement to purchase a product or service.
Premiums are used by wholesalers to induce retailers to promote or push their products. The objectives of premiums are generally to
(a) Induce consumers to switch from a competitor’s product to the seller’s,
(b) Induce consumers to try larger sizes of products,
(c) Increase off-season sales,
(d) Introduce a new product.
In this method, producers announce some incentives to the dealer. It is also an effective tool for increasing sales. For this purpose special prizes are fixed for dealers if they achieve their pre-determined targets.
(v) Credit Facility:
Under this method the producer allows credit to their dealers, based on the quantity purchased by them. This enables them to purchase a bulk quantity.
(vi) Advertising Allowance:
Under trade promotion methods, advertising allowance is also given to the dealer. The allowance is offered to the dealer to display the manufacturer’s product in the shop.
Under this method, producers give attractive and useful articles to dealers against their orders. The articles are transistor, radio, television-set, clock, watch, etc. Some manufacturers offer free holiday family tours to the dealers who place more orders.
Through this method, producers train their dealers so that they may make more and more sales of products easily and smoothly.
(ix) Dealers Listed Promotion:
This is the most important method of sales promotion. Listing dealers is a part of advertising. It gives a list of dealers or retailers who stock the product or who are engaged in its promotion. For example, the advertisement of L.G. product in newspapers carries the names of the stockists of their products. The consumer can buy products from anyone of the listed dealers. This method induces dealers to stock their products.
(x) Point-of-Purchase Advertising:
The point-of-purchase display is the silent salesman that calls the attention of the customer to the product in the hope of initiating buying action. Point-of- purchase is also known as dealer hopes, dealer aids, dealer displays, merchandising and point-of-sale material. Point-of-purchase advertising means advertising at the point of purchase. It is generally at the level of a retailer’s shop.
3. Combined Promotion Methods:
For sales promotion, consumer promotion methods and trade promotion methods are applied. Both these methods are complementary to each other. The first is consumer promotion method which motivates consumers to purchase. The second is trade promotion method which increases the business.
For the success of any business both the promotion methods are necessary. Without consumers’ promotion trade promotion cannot run. In the same way without trade promotion consumers’ promotion cannot run. They are not competitive of each other but are complementary.
As a man needs two legs to walk, so both are compulsory for promotion. The work of sales promotion can be performed if there is balance between the planning of these two promotions. Therefore, consumers’ promotion method and trade promotion method should be implemented together for sales promotion. For good results, it is necessary that a right balance should be set between them.
4. Sales Force Promotion Methods:
Sales force promotion schemes are necessary to increase sales.
The tools for sales force promotion are:
This is an incentive given to the sales people to sell more products to cross the quota or targeted sales. The manufacturer sets a target of sales for a year. If the sales force sells the products above the targeted figures, bonus is offered to them.
Contests stimulate salesmen to sell more products. This method is used to increase sales. For this purpose, prizes are given to salesmen who secure the maximum sales in sales contests.
Meetings are conducted by producers for the purpose of educating, inspiring and rewarding salesmen. Under this method, new products and new selling techniques are described and discussed with salesmen.
(iv) More Commission:
Sometimes, sellers are offered more commission by offering cash incentives and sometimes sellers are given such goods that they may use them for personal purpose or for official jobs. In this regard the example of Life Insurance Corporation is worth citing.
For example, if the amount of insurance policy increases more than set quantity then the rate of commission offered is 15% besides additional bonus which is also given. If the field officer insures more than his quota then increments are given and telephone facility is also provided.
AIOU Solved Assignment Code 439 Spring 2021
QNo 4 Describe various characteristics and types of product literature in Pakistan. How we can make product literature more effective?
The first P of the Marketing Mix is Product. It is the bases of the marketing mix of a company. It is important for a company to develop the perfect product for the right market. Here we will look at the various types of products and the life cycle of a product. Let us get started!
A product is generally categorized as a tangible good but it can also be an intangible service. Companies take a lot of time and effort to develop quality products that are in demand in the market. A good product is the very basic requirement of an effective marketing mix.
Products are broadly classified into two categories – consumer products and industrial products. Consumer products are products that the ultimate consumer purchases himself for direct use. The consumer purchases these consumer products to satisfy his personal needs and desires. Some examples of consumer products are toothpaste, eatables, textiles, computers etc and various such products.
Now there are many types of consumer products as well. Let us take at the classification of consumer goods based on the shopping effort involved:
- Convenience Products: These are consumer goods that are very convenient to purchase. They are bought frequently and with very little effort. Examples include medicines, toiletries, newspapers etc. Such convenience products have ongoing and continuous demand. Such goods are also bought in small quantities and are also generally lowly priced.
- Shopping Products: To shop for these consumer products, consumers devote considerable time and effort. They compare prices and features and a lot of thought is involved before making the decision to buy. Some such examples are electronics, furniture, jewelry etc. These products generally fall in the higher price range. Such products are pre-planned purchases.
- Specialty Products: For specialty products, consumers make special efforts to buy them. They are not your regular run of the mill consumer products. The buyer is willing to go through a lot of effort to purchase such products. Take for example any artwork, paintings, sculptures etc. The demand for such specialty products is usually pretty limited and the pricesare high.
These are products which are used as input for manufacturing other products. Unlike consumer goods, these are not for direct consumption. These are meant for business and non-personal use. Some examples of industrial products are raw materials, machines, tools etc.
Here the demand for industrial products is limited. Since they are not consumer goods the demand for them is not vast. The three broad categories of Industrial goods are as follows
- Machine and Machine Parts: These goods are used entirely in the manufacturing process. These include raw materials like cotton, lumber, petroleum etc. They also include manufactured products like glass, rubber etc.
- Capital items: These are goods/products used to manufacture finished goods. They include installations (lifts, mainframe computers etc) and equipment (hand tools, personal computers etc)
- Business Services and Supplies: These are industrialgoods and services that facilitate the manufacturing process. They include services such as painters, technicians, maintenance, and repairs. And products such as lubricants, stationary etc.
Product Life Cycle
Product life cycle is a representation of the cycle through which each product goes through from introduction to decline and eventual demise of the product. The Product Life Cycle helps us recognize which stage the products are in. Accordingly, the company can adjust their marketing strategy to make most of the conditions.
There are four distinct stages in a product’s lifecycle. Right from the introduction of the product in the market to its end. Every stage has its own distinct features. And the company should change its marketing strategy every time the product makes its move from one stage to another. Let us take a look at the four stages.
As the name suggests this is the stage of introduction of the product to the market. At this stage, the demand for the product is only a proved demand and not effective demand. This stage is categorized by the following features
- The product’s sale is at its lowest and is increasing but very slowly
- During the introduction, the promotion expense is very high. Extensive promotions have to be undertaken to create awareness and demand for the product.
- The products are put in limited outlets. The distribution is also kept limited to a few channels. The point is to try out the product before expanding distribution.
2] Growth Stage
This is the second stage of the product lifecycle. Now the sales begin to take off and the product becomes well known. Some other characteristics are
- The promotionexpenses still remain high. Now the focus will be on brand recognition and brand image. This helps the product maintain and extend its selective demand.
- With a rise in sales, the profits also rise sharply
- This is the stage where new competitors may enter the market with better research and better products. To keep up with their products, the company may make improvement and modifications to their products
3] Maturity Stage
- This is the stage where the market saturates and sales growth of the firm slow down and finally stabilizes at a stage.
- Competition in the market will intensify in this stage. All competitors will want to maintain a production level to enjoy economies of scale
- This stage may also see a price war in order to keep their market share. Reducing prices may affect the profit margin of the company.
4] Decline Stage
This the terminal stage of the products, they are no longer relevant in the market. So the end of this stage is the eventual demise of the product in the market.
AIOU Solved Assignment Code 439 Autumn 2021
Q No.5 Comment on the nature, purpose, and functions of direct mail with appropriate examples.
A type of direct marketing that’s delivered physically to a prospect’s mailbox through the United States Postal Service or other delivery service. Postcards, flyers, and catalogs are common examples. Email marketing is the digital equivalent.
Direct mail is interactive.
Because customers physically handle mail and usually look at it before deciding whether to keep it, direct mail can help get more eyes on your marketing.
If you include a promotional offer, coupon, or a CTA that requires them to do something with the mailer such as bring it to a store or restaurant, your customers are more likely to keep it.
Getting letters in the mail can evoke nostalgia about the times friends or family has sent you mail. If you’d like to spark a more emotional response in the recipient, consider adding a personalized touch like a handwritten note or signature. Small gestures like this can make your marketing more memorable.
Direct mail can also reach a wider demographic than electronic advertising if your target audience is less likely to use social media or email. This form of marketing can turn some people into potential customers when all-electronic ads would have missed them completely.
It offers a lot of ways to get creative.
You can pair social media and digital content marketing with direct mail for a seamless customer journey.
A Utah-based marketing firm, for example, ran a holiday campaign in which they sent out a card and a $20 bill while encouraging recipients to spend the money on a charitable donation. When people scanned the code on the back of the card, it brought up an explanatory YouTube video and gave them a hashtag they could use when posting about their contribution on social media. This increased people’s awareness of their brand and emphasized the company’s values to the public.
There are even more ways to get creative with direct mail because its tactile nature gives you the chance to engage more of your recipients’ senses than digital marketing. Here are just a few examples of innovative marketing techniques from various companies:
- A Brazilian gym gave out calendars to their customers with cutouts in the shape of a man and a woman. As they flipped back each month, the silhouettes of the people got slimmer, imitating the effect of consistently working out.
- To promote World Water Day, one marketing team sent out direct mailers with a message that only became visible when soaked in water.
- An Australian marketing firm sent out disassembled cardboard FM radios. The recipients who put them together were directed to tune the radio to a channel where they could hear an ad inviting them to join the national defense force.
Companies are scaling back their physical marketing efforts in favor of digital marketing. Digital is the more environmentally friendly route, and it’s also easier to start seeing results with digital.
But because not as many companies are operating in the direct mail space these days, it’s easier to get noticed.
Remember that most people will at least skim through their mail before throwing it away, and a colorful, creative piece of mail has a much better chance of standing out in someone’s mailbox than your website does on Google—at least in the beginning. People don’t expect direct mail as much in the modern age, and they aren’t subjected to the same distractions when looking through physical mail as they are when they’re online.
Even if someone doesn’t use your coupon or special offer right away, they might keep it, especially if it’s something they need. They’ll stick it on their fridge or a board and let it hang out. Then when they’re looking for a new pair of pants or a deal on power tools, your company will be more likely to come to mind