Author: Ibtesaam Parveen Lari, MMS ‘A’ ‘28’.

KBS Batch: 2018-20.

Topic: Sales Promotion

1.      Economic and utilitarian benefits of monetary versus non-monetary in-store sales promotions:

Summary: While prior research has examined the issue of sales promotion proneness, very little has examined proneness to non-monetary promotions, such as contests and premiums discovered in store. This study draws on a promotions benefits framework to examine the influence of shoppers’ desired benefits on their relative proneness to in-store monetary and non-monetary promotions. Computer-aided telephone interviewing (CATI) data gathered from 500 grocery shoppers are used. The findings show that shoppers who are prone to using non-monetary in-store promotions seek exploration, entertainment and value expression benefits, in common with shoppers who are prone to monetary promotions.

2.      Is 75% of the Sales Promotion Bump Due to Brand Switching? No, Only 33% :

Summary: Several researchers have decomposed sales promotion elasticities based on household scanner-panel data. A key result is that the majority of the sales promotion elasticity, approximately 74% on average, is attributed to secondary demand effects (brand switching) and the remainder is attributed to primary demand effects (timing acceleration and quantity increases). To gain insight into the magnitude of the difference, the authors apply these expressions to previously reported elasticity decomposition results and find that approximately 33% of the unit sales increase is attributable to losses incurred by other brands in the same category.

3.      Decomposition of the Sales Impact of Promotion-Induced Stockpiling:

Summary: Promotion-induced consumer stockpiling has a negative impact on manufacturers because it moves forward in time brand sales that would have occurred later at full margin. However, the resultant increase in consumer inventory has two potential benefits: increased category consumption and preemptive brand switches (the additional inventory of the promoted brand preempts the consumer’s purchase of a competing brand in the future).

4.      MAGAZINE SALES PROMOTION:

Summary: This paper studies the effectiveness of a type of nonprice promotion often used in the European magazines industry to diminish the decline rate of periodical sales, in which a value pack is sold containing the magazine issue plus another product. Magazines are sold simultaneously with and without promotion at different prices, and promotions are serialized by fractioning the additional product across different issues of the magazine. Although promoting magazines contemporarily may cannibalize nonpromoted sales, this loss is compensated by a long-term increase in nonpromoted sales caused by product awareness and loyalty improvements. This strategy is increasingly used as an innovative form of product advertising.

5.      The effects of sales promotion strategy, product appeal and consumer traits on reminder impulse buying behaviour:

Summary: This article investigates factors of marketing communications and consumer characteristics that induce reminder impulse buying behaviour. Study 1 applies the antecedent, process and consequence approach to investigate the essential differences between reminder impulse buying and pure impulse buying. The results of Study 1 reveal that reminder impulse buying significantly differs from pure impulse buying on motivation, buying goal and decision evaluation.

6.      Taming the Blame Game: Using Promotion Programs to Counter Product-Harm Crises

Summary: The present research examines how different kinds of promotion programs (i.e., price discount versus donation promotion) buffer brands from the ill effects of product-harm crises. Drawing on attribution theory, the authors investigate the differential effects of promotion programs on consumer responses following ambiguous product-harm crises.

7.      Pre-empting Switch on Deal Retraction:

Summary: Consumer sales promotions (deals) are important promotional tools used by marketers to achieve immediate sales. However, sales promotion campaigns will not be profitable if customers do not make repeat purchases but switch to other brands once the deal is retracted. Typically, incremental sales during sales promotion campaign is obtained from the deal prone consumers with high brand switching tendency, as they are more likely to switch to a brand offering deal to reach his/her optimum stimulation level.

8.      A study of attitude and perceptions of pharmaceutical value chain members towards consumer promotions:

Summary: This study is an attempt to analyze the attitude of pharmaceutical value chain members towards sales promotion schemes. The researchers have studied the factors that managers/sales staff believe are important for the company to offer trade/consumer promotions. It has been observed that consumer promotions are focused on long term as well as short term goals. The study also revealed that there is a close relationship between sales promotion and the structural variables of the company.

9.      Clearance Pricing Optimization for a Fast-Fashion Retailer:

Summary: Fast-fashion retailers such as Zara offer continuously changing assortments and use minimal in-season promotions. Their clearance pricing problem is thus challenging because it involves comparatively more different articles of unsold inventory with less historical price data points. Until 2007, Zara used a manual and informal decision-making process for determining price markdowns. In collaboration with their pricing team, we since designed and implemented an alternative process relying on a formal forecasting model feeding a price optimization model.

10.   Government Adoption of Sales Promotions: An Initial Appraisal:

Summary: Governments have begun to adopt sales promotions to shape household consumption. Successful private-sector promotions hinge on choice of goals, design parameters, and implementation, particularly coordination between manufacturers and retailers. In the public setting, additional considerations—including equitable and nondiscriminatory treatment of citizens, the influence of the political process on goal setting and program design, the lack of experience in managing marketing programs, and a high level of public scrutiny—may constrain their application. The authors evaluate two recent incentive programs implemented by the U.S. government—the TV Converter Box Coupon program and the “cash-for-clunkers” stimulus in the automotive industry.

 

 

CONCLUSION:

The above 10 reports indicate the different ways of sales promotion and how different industries does it differently. Each of the above 10 articles showed the problem in sales promotion however also showing how the industry thrives in the market even with those problems. Many of them faced a pricing problem which a recurring problem when it comes to sales promotion. Each of them dealt with them in their own different way which brought them results and eventually lead them to success of the industry. From magazines to textiles everyone showed a flaw in their industry but they also how they dealt with them in their own different way.

REFRENCES:

 

1.     Reference: Mike Reid, Peter Thompson, Felix Mavondo, Karen Brunsø(2015)” Economic and utilitarian benefits of monetary versus non-monetary in-store sales promotions” Journal of Marketing Management, 2015 Vol. 31, Nos. 3–4, 247–268.

 

2.     Reference: HARALD J. VAN HEERDE, SACHIN GUPTA, and DICK R. WITTINK(2003)” Is 75% of the Sales Promotion Bump Due to Brand Switching? No, Only 33% Is” Journal of Marketing Research.

 

3.     Reference: KUSUM L. AILAWADI, KAREN GEDENK, CHRISTIAN LUTZKY, and SCOTT A. NESLIN(2007)” Decomposition of the Sales Impact of Promotion-Induced Stockpiling” Journal of Marketing Research 450 Vol. XLIV (August 2007), 450–467.

4.     Reference: Mercedes Esteban-Bravo, José M. Múgica, and Jose M. Vidal-Sanz(2009)” MAGAZINE SALES PROMOTION” Journal of Advertising, vol. 38, no. 1 (Spring 2009), pp. 137–146.

 

5.     Reference: Shu-Ling Liao, Yung-Cheng Shen and Chia-Hsien Chu(2009)” The effects of sales promotion strategy, product appeal and consumer traits on reminder impulse buying behaviour” International Journal of Consumer Studies 33 (2009) 274–284.

 

 

6.     Reference: Yi Xie, Hean Tat Keh(2016)” Taming the Blame Game: Using Promotion Programs to Counter Product-Harm Crises” Journal of Advertising, 45(2), 211–226.

 

7.     Reference: Surajit Ghosh Dastidar(2019)” Pre-empting Switch on Deal Retraction” Journal of Management Research Vol. 19, No. 1, January-March 2019, pp. 16-28.

 

8.     Reference: Shweta Srivastava and Anand Sharma(2012)” A study of attitude and perceptions of pharmaceutical value chain members towards consumer promotions” Department of Pharmaceutical Management, National Institute of Pharmaceutical Education and Research (NIPER).

 

9.     Reference: Felipe Caro and Jérémie Gallien(2012)” Clearance Pricing Optimization for a Fast-Fashion Retailer” OPERATIONS RESEARCH Vol. 60, No. 6, November–December 2012, pp. 1404–1422.

 

10.  Reference: John A. Quelch and Katherine E. Jocz(2010)” Government Adoption of Sales Promotions: An Initial Appraisal” Journal of Public Policy & Marketing Vol. 29 (2) Fall 2010, 189–203.

 

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