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Add Value to your Sales efforts!

The strategy to buy a service or product by using trade loaders or a gift with purchase dates back to the very dawn of marketing itself. It’s a concept that still works today. Walk down any Coles aisle, drop by any fast-food restaurant, or page though any Sunday advertising supplement,

Trade loaders are still being used to promote better placement on the shelves or entice sales people to promote retail lines more rigorously. Sometimes the gifts are substantial, (as in plasma televisions). But most are associated more strategically with the product being promoted, like the classic cosmetic bag linked to a new range of make-up.

Here are some of the important issues to consider when planning your gift-with-purchase or trade loader promotion:

*. Determine your specific program objectives. Is it to rejuvenate sluggish sales? To maintain share during a competitive product introduction? To reach a new group of consumers? The simpler you can keep your objectives the more measurable they will be. What is the right technique for implementing this promotion? Aggressive? Across many forms of media, or just one?
*. Review your history with gift-with-purchase programs. What worked? What hasn’t? What kind of results can they realistically expect? Also what has the competition done on this front?
*. Determine your budget. In general terms, your expenditures should be tied to anticipated, incremental sales. Some companies set aside a certain percentage of overall sales for promotional spending, but there is no definitive rule for determining this percentage. But you must consider if you actually have the budget to effectively support a Gift-with-purchase program. How do you intend to support your program with advertising and point-of-purchase material? Cutting corners in some areas may affect their programs success.
*. Identify a gift-with-purchase product that reinforces use of your brand. The item should appeal to your target audience and have a high perceived value relative to the cost of their product. Will it be custom designed? Or “off the shelf”? Brand name or generic? Is the gift right for the target audience? But more importantly, why? Does the gift fit with your product's brand positioning and audience?

*. Put together your time line. Plan your start and finish dates and determine who will be responsible for each step of the program. Most gift programs are limited-time promotions. Every effective program offers a specific gift for a specific period of time to maintain continued consumer interest.
*. Determine how you will measure results. And make sure you have a system in place to track those results. This is KEY to successful programs. Other forms of advertisement does not have the quantifiable results promotional product marketing has, use these results to sell your next promotion.
*. Engage the support of everyone responsible. Communicate regularly with all parties involved and see how the program might be supported through your sales and/or dealer incentive programs. ...
*. Evaluate the results. Be objective about the results of your program and how it worked. Keep a record of your results and observations for use in planning future programs.

Increased sales is, of course, the major factor you will use to measure the success of your gift-with-purchase promotion, but other factors might include:

* Increased customer goodwill;
* Retail and employee excitement about your product and offer;
* Generation of repeat store visits or purchases;
* Faster sell-through.

It is important to calculate the cost versus the perceived value of the gift. Branded products often have a higher perceived value but obviously cost more money. Other cost considerations include:

* Advertising and point-of-sale materials;
* Getting the gifts and supporting point-of-sale materials to the stores and onto shelves; all associated freight charges.
* The cost of staff or outside service firms dedicated to the execution of the program.
* Any packaging changes that might be necessary.
* Fees associated with sweepstakes registration.

Costs should be balanced against your expected return on investment. This also goes for calculating a factor for repeat business that might be generated as a result of the gift.

With an advent of the internet revolution, promotions (or their redemptions) can be run on line. Pepsi has done this effectively by driving business to their website to register to win gifts for many promotions. Can you offer these types of promotions? It is important to consider that this additional step in the process. It may limit some redemption, but this type of on-line redemption does provide some traceable data on these campaigns.

A factor often overlooked in budgeting: If the gift promotion is an unusual one, there may also be some opportunities for generating publicity.

Choosing the right gift to include with your offer is perhaps the most important issue connected with this type of program. The following questions could easily be asked ;

* Does the gift fit in with your product's brand positioning? The wrong gift could possibly do more harm than good to an established brand image by sending a mixed message to consumers. Some experts also warn that the gift-with-purchase strategy is not useful for new product introductions, because it splits the focus of the consumer. That is particularly true if the gift involves a recognized brand: There's a danger that the consumer will perceive the new product as the gift.
* Does the gift make sense for their target market?
* Does the gift support usage of the brand you are promoting? Will it generate goodwill to aid in a repeat sale? If you're promoting donuts, for example, a coffee mug would support future use of the product. If you're promoting toothpaste, a toothbrush and so on.
* Does the gift tie in well with your overall promotional theme? Is the item different, creative and does it illicit a response from the purchaser? Themed promotions are more memorable than non-themed. Concepts tied in with the season or with an overall campaign creates future marketing potential.

There are always alternatives to the standard gift with purchase program. To keep costs down, companies often use these other value-added promotions:

* Self-liquidators. Instead of an outright gift, the company can offer consumers a promotional item at a substantially reduced price, recovering some, or all, of the costs.
* Sweepstakes. Purchasers are entered into a sweepstakes with the possibility of winning a prize or prizes. Obviously, more expensive prizes can be offered to enhance the perceived value and increase consumer participation in the sweepstakes. Make sure you know the requirements for organising the correct legal documentation for registration in each state before running these types of promotions (They must be paid for and registered separately in each state).
* Continuity programs. The gift is offered for a specified number of repeat purchases or store visits to build customer loyalty and repeat business.

Most consumer purchase decisions are made at the point of sale. That makes packaging and merchandising critical to the success of most gift-with-purchase promotions. Effective execution can make the difference between mediocre and spectacular results. This includes such things as obtaining extra shelf space or display space.

In-pack/on-pack gift promotions. In many cases, the gift can be included inside the package, as cereal makers have traditionally done. In-pack gifts need to be specially promoted on the product packaging to draw attention to the offer. On-pack gifts, on the other hand, might require special packaging (and packaging equipment) and special handling in stores. That could add significantly to the cost of a program.
Container promotions. In some cases, the packaging itself is the gift. Jam companies sometimes sell their product in packaging that can be reused as everyday glassware. Such brands as Milo occasionally offer product packaging that is designed to be saved as collectibles.

APPEAL – A fine line
Gift-with-purchase offers can give less-than-anticipated results if the gift fails to appeal to the target audience or offers a low perceived value in relation to the cost of the product.

Be aware that it is possible to overuse gift-with-purchase. If a program goes on too long, consumers may come to expect a free gift, and they can be annoyed when the program is concluded. Consumers might also respond negatively if the gift is not perceived as being as valuable as a previous gift offer. Also, a predictable schedule for a company's gift promotions may "train" consumers to time their purchases so that they tend to buy only when a gift promotion is on.

Source - APPA

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