Sales PROMOTION Strategies:
 
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Theory of Advantage Merchandising:

•	Why Monitor customer loyalty and buying frequency: 

Food service establishments rely on repeat customers.  A sense of fairness, quality, and preference heighten a patron’s comfort with a business.  The product discount systems are designed to help differentiate one business from its competitors.  Strategies in the discounting systems can take many forms but in general reward the customer for frequent buying of specific products.  Discount systems augments each other as promotion utilities and these vary from coupons, senior discounts, mix/match discounts, ‘Rewards’, ‘Advantage’, standard quantity discounts, and so on.  Some methods of promotion discounting are stated below.  The motivation of all programs is increase store sales, traffic, and customer loyalty. 

Common promotion strategies are the these:

1.  Item direct discounting by percentage off or amount off.
		Example: 30% off regular price.

2. Split Price items.
		Example: 3 for $1.00 where $.50 each regular price.

3. Quantity price:
		Example: 1 at $.75, 6 at $ .65, 12 at $.60, 24 at $.50 each.

4. Manufacture Coupons where the discount strategy is on the barcode and the UPC standard table.  These strategies range from cents off, free, % off, and set amounts back.

5. Store Coupons where the store (headquarters) issues barcode coupons in advertising (or other means) that redeem against product and use the UPC standard strategy tables.

6. Store Coupons that use a number to reference local strategies.
		Example: Coupon #7 goes to strategy 5 to give $1.00 off a 12 			pack of Coke if redeemed before July, 2006.

7. Store Receipt Coupons that print at the time of purchase and encourage cross department buying.
		Example: Customer buys Cereal without milk, give coupon for 			20% off milk purchase.

 8. Item Discounts based on customer status or relationship.
		Example: Police officer gets 20% off pastries and coffee.
		Example: Employee get 20% off produce. 

9. Frequent Shopper Points (Rewards) discounts.
		Example: Spend $500 at store chain facilities and allow 				redemption of points (500) against promotion items, such 			as wine or clothing items like tee shirts.
		Example: Buy 10 cups of coffee, get the 10th cup free.

Frequent Shopper systems must accumulate product buying per customer and require a tractable identity such as a member card. 

10. ‘Advantage’ system buying strategies include concepts like
	Cents off
	Buy more/Get more
	Buy quantity get least free
	Buy get free
Loyalty programs like ‘Advantage’ have many strategies.  The buying advantage is passed to ‘Member Customers’ based on their purchase and the match between items in the advantage at the time of purchase.  These programs are used to create frequent repeat buying and customer loyalty.
		Example: A customer has ‘Advantage’ card that is scanned.  			Active at this date is $.50 a gallon off milk for members.  The 			‘Advantage’ member would realize the $.50 savings at the time 			of sale without cashier intervention.  The discount would be 			itemized on the receipt high-lighting the savings.

Theory of Advantage Programs: