Advertising & Promotion
Spring 2009
Procter & Gamble (B)
Light Duty Liquid Detergents
May 16, 2009
Amanda Barraza
Ted Chiang
Olga Shipilo
Clare Tan
1.What factors and policies guide promotion planning for the LDL’s?
i)Budget Allocation: The LDL managers of Ivory Liquid, Dawn, and Joy spend about half of their marketing budget in advertising and with a lower share on promotion. This is different from the strategy of Colgate & Lever, who spends a higher percentage on promotion. The marketing budget for H-80 is $60 million for the first year, which includes $18 million on advertising, $37 million on promotion, and $5 million of miscellaneous marketing expenses. ii)Scheduling of LDL Promotional Events: The
…show more content…
From 1979 to 1981 the share of consumers who claimed that they almost always used a manufacturer’s coupon increase by 6% to 28%; those who never used coupon “just occasionally” or “never” decrease by 4% and 3%, respectively.
Secondly, research indicates that for a new brand such as H-80 trail size represented by far the best purchase incentive for a consumer who had never tried a brand. Research has also pointed out that free mail-ins is an effective tool to achieve sampling of new users.
vii)Existing and New Competitors The LDL environment was becoming more intense, characterized by the increasing use of coupons and the entry of new brands with higher promotion budget than that of H-80.
viii)Promotion Alternatives
a.Trade Allowances: Based on previous experience, the sales division has recommended that $2.7/statistical case trade allowance on all sizes in the first 3 months was necessary to stimulate initial stock, in-store displays, and feature advertising by the trade. Furthermore, a $1.8 /statistical case allowance is believed to be effective as a fourth promotion event.
b.Sampling: An analysis based on 40.4 million households (50% of target households) indicates that the sample size of 6 ounce, 3 ounce, and 1.5 ounce are the most cost efficient sizes for sampling (Table 1). However, due to budget limitation Garner would not be able to afford sending out 6 ounce
this study is the use of convenience sampling, as previously mentioned. Black et al. (2000) make
For the majority of the simulation the team agreed to leave the volume discount relatively the same. The average discount given was between 30% -35%. However in periods 4 and 5 we decided to increase volume discount less than 250 and wholesale by 2%. Coupon discounts remained consistent throughout all 8 periods for Allround and the same when Allround + was brought on board. Looking back, it may have benefited the team, had we increased our coupons allowances which may have helped us to gain more market shares throughout the industry.
The usage of discount coupons is simple and holds a lot of profit with website based coupons you get online from a store where securing is a factor you are incumbent to establish.
The marketing strategy, mass marketing, has come to an era where improvement is paramount due to the influx of different cultures in the United States. Particularly, the Hispanic culture has developed a significant amount of influence to where it has been as profitable to better understand and target this group of consumers. Estimated at over 22 million, comprising over 8 percent of the total, and growing at six times the rest of the U.S. population, Hispanics spent over $171 billion on goods and services in 1990 (Cherian, p. 501-2). Due to the variations in the Hispanic culture, this study examines the differences in the response of Weak and Strong Hispanic, in reference to ethnic identification, to coupon usage and brand loyalty.
Display Allowance – Investing in this promotional strategy can he very effective as it can guarantee that the scooters are displayed prominently in a high traffic area of the store. The disadvantage is that the supplier has no control over the placement of competitive products in relation to their scooters.
This enables' them to sell their unsold outdated stocks but also help them to keep intact their old customer , and have new customers with this promotion .
Those who take the time to post match-ups will almost always tell you the source and date of the coupon. That makes it easy to go to the correct file and cut the coupons you need for that week's shopping trip.
Extreme couponing is creating more market savvy consumers that are focusing less on brand loyalty; which is a big problem for marketers. According to Viamari “48% of consumers say coupons heavily influence their brand decisions, and 38% of consumers say they would give up some of their favorite brands to save money.”
Impulse buys. Also since people carrier their cell phone with them, the coupon isn’t forgotten.
Use of discount coupons are availed from discounts websites where there is a better deal that you will get when you register with this online method of getting proper access to attain facilities that websites are certain to obtain with proper methods you are sure to find as source of conviction of making buys you are certain to find in many situations.
2) Company spends 3 percent of net sales on advertising and sales promotion efforts. 55 percent of advertising and sales promotion dollars are allocated to cooperative advertising programs with retail accounts. Janmar pays for a portion of an account’s media costs based on the dollar amount of paint purchased from Janmar. Remainder of advertising and sales promotion budget is spent on in-store displays, corporate brand advertising, outdoor signs, regional magazines, premiums and advertising production costs.
Companies use coupons to get a customer's attention. However, how people use coupons in entirely up to the customer. Without using coupons, you are wasting the money on a daily bases. This money can go to important objects such as gas money or bills. All that will cost the customer to use coupons is time. Being a couponer is essential to saving money. To become a couponer you must start collecting coupons, buy a binder to become organized, and start looking for deals at stores.
The relationships with trade show retailers are highly valuable in that they often prove to be long term. Re-orders by retailers from trade shows occur at a 50% clip, and they will re-order twice per year. With an average order from a retailer being $569 (Table 1), and the direct material and labor cost fixed at $267, the contribution margin per order at trade shows will be $302 (Table 2).
That’s what you do every time you miss an opportunity to use coupons. You are offering to pay more money for something than what you have to pay if you use coupons. Let’s review the value of clipping coupons. Coupons can save you money that can help you pay bills, make a purchase, save for your college education, save for your children’s college education or start a retirement fund. There is no out of pocket expense in order to reap these benefits, just a very small portion of your time. Let’s look at the flip side of the coin. If you don’t clip coupons, you won’t have extra money to help with expenses and purchases. You may have to take out a loan for purchases and expenses and incur interest expense as well. If you were diligent in your quest to save, you could be $75,000 richer in ten years. When you buy a lottery ticket your odds are 1 in several million that you will win. With coupons there are no odds, just solid savings. Coupons are free money for the taking. Take the time to clip coupons out of the newspaper or get them online. It only takes a few minutes of your time and saves you money that you can use for whatever however you choose. Capital One asks What’s in your wallet. I can tell you what won’t be in your wallet, if you don’t take advantage of coupons,
My signature indicates that this document represents my own work. Excluding shared data, the information, thoughts and ideas are my own, except as indicated in the references. I have submitted an electronic copy through Balckboard to be scanned by TurnItIn.com. In addition, I have not given aid to another student on this assignment.