Deck 20: Consumer Sales Promotion: Premiums and Other Promotions

Question 1

A greater percentage of consumers take advantage of free mail-in offer premiums than any other type of premium offer.

Answer 1

False

Question 2

Self-liquidating offers usually require that the consumer mail in a stipulated number of proofs-of-purchase,along with sufficient money to cover the manufacturer's purchasing,handling,and mailing costs of the premium item.

Answer 2

True

Question 3

Mail-in offer premiums can be used to encourage repeat-purchase behavior.

Answer 3

True

Question 4

The perceived value of a premium item depends on the value of the brand that is offering the gift.

Question 5

Price-off labels may be used on new brands.

Question 6

Retailers do not like when manufacturers use near-pack premiums.

Question 7

Price-off promotions are also called cents-off.

Question 8

Price-off promotions are effective when the marketer's objective is to reward present brand users.

Question 9

Bonus packs are extra quantities of a product that a company gives to consumers at the regular price.

Question 10

Free-with-purchase premiums are primarily designed to generate repeat purchases.

Question 11

No type of premium offer can serve to enhance a brand's image.

Question 12

Price-off promotions create problems for retailers,causing them to dislike this type of promotion.

Question 13

Bonus packs are sometimes used as an alternative to price-off deals.

Question 14

The Federal Trade Commission states that there must be a hiatus period of at least 90 days between price-off label promotions on any given brand size.

Question 15

Price-offs cannot reverse a downward sales trend.

Question 16

A free roadside kit given to a customer with the purchase of four tires is an example of a premium.

Question 17

Promotional games are capable of creating excitement,stimulating brand interest,and reinforcing brand loyalty.

Question 18

Premiums are articles of merchandise or services offered by manufacturers to induce action on the part of the sales force,trade representatives,or consumers.

Question 19

Bonus packs are intended to encourage trial from consumers.

Question 20

A rebate is the practice where manufacturers give cash discounts or reimbursements to consumers who submit proofs of purchase.

Question 21

Rebates for less than $20 are typically redeemed at the retail checkout.

Question 22

Which of the following is a type of consumer-oriented promotion? 

A) allowances 
B) cooperative advertising 
C) social media 
D) premiums 
E) experiential model

Question 23

Retailers can't commit rebate fraud because a rebate occurs between manufacturers and consumers.

Question 24

The issue surrounding evaluating promotions is whether or not to even evaluate promotions.

Question 25

One drawback for manufacturers offering rebates is that many consumers never bother to redeem them.

Question 26

Buick ran a contest that provided entrants with the opportunity to win a new Buick Lucerne.The ultimate purpose of the contest was to encourage people to visit Buick dealerships.Of the more than 500,000 entrants to the contest,3,000 agreed to take a test drive.This promotion generated a large number of potential Buick purchasers and also contributed to Buick's large and expanding _____.

A) brand image 
B) geographic reach 
C) online brand community 
D) new driver segment 
E) database

Question 27

Proofs of purchase cannot be required as a condition for entry in a contest or sweepstake.

Question 28

Contests and sweepstakes are used primarily to enhance a brand's image.

Question 29

The major objective of continuity promotions is to enhance the image of the brand.

Question 30

Contests generate greater response than sweepstakes.

Question 31

The use of two or more sales promotion techniques in combination with one another is called an overlay.

Question 32

Retailers also design promotions for their present and prospective customers.

Question 33

Which type of consumer promotion offers consumers a delayed reward with the objective of reinforcing a brand's image? 

A) contest 
B) mail-in offer 
C) continuity programs 
D) price-offs 
E) bonus packs

Question 34

Compared with many other sales-promotion techniques,sweepstakes are relatively expensive.

Question 35

Achieving agreement is the first step in evaluating sales promotion ideas.

Question 36

Which type of consumer promotion offers consumers an immediate reward with the objective of encouraging repeat purchases? 

A) samples 
B) phone cards 
C) continuity programs 
D) self-liquidating offers 
E) bonus packs

Question 37

Continuity promotions are referred to as loyalty programs.

Question 38

_____ are articles of merchandise or services offered by manufacturers to induce action on the part of the sales force,trade representatives,or consumers.

A) Coupons 
B) Rebates 
C) Price-offs 
D) Premiums 
E) Add-ons

Question 39

Tie-in promotions are cost-effective because the cost is shared among multiple brands.

Question 40

When evaluating promotions,efficiency represents a promotion's cost-per-thousand.

Question 41

Which of the following should a manufacturer consider when choosing a premium? 

A) the brand's image 
B) the target market 
C) the objectives of the promotional period 
D) the item's value 
E) All of these are correct.

Question 42

Which type of premiums require the consumer to mail in a stipulated number of proofs of purchase along with sufficient money to cover the manufacturer's purchasing,handling,and mailing costs of the premium item? 

A) free-with-purchase premium 
B) mail-in offer 
C) self-liquidating offer 
D) add-on premium 
E) contingency premium

Question 43

Which of the following is the typical range of the reduction for a price-off promotion? 

A) 2-5% 
B) 5-10% 
C) 9-15% 
D) 10-25% 
E) 15-30%

Question 44

Which type of premium can build sales volume in stores that put up displays and participate fully? 

A) near-pack premium 
B) self-liquidating offer 
C) mail-in offer 
D) add-on premium 
E) continuity premium

Question 45

Which of the following is a type of premium? 

A)  trade allowance 
B) self-liquidating offer 
C)  efficiency premium 
D)  segmented premium 
E) add-on premium

Question 46

Laurie received a free Hawaiian shirt from Tropicana Orange Juice by sending in ten proofs of purchases.What type of premium is this? 

A) free-with-purchase premium 
B) in-pack premium 
C) on-pack premium 
D) wearable premium 
E) mail-in offer

Question 47

_____ entail a reduction in a brand's regular price and are clearly labeled as such on the package.

A) Bonus packs 
B) Price-off promotions 
C) Premiums 
D) Rebates 
E) Coupons

Question 48

A perfume manufacturer will send you a new lotion that uses the perfume you like if you mail them a proof of purchase and $5.00.This is an example of a(n)_____.

A) self-liquidating offer 
B) reimbursed premium 
C) on-pack premium 
D) out-of-store premium 
E) in-pack premium

Question 49

_____ premiums are less expensive because additional packaging is not required.

A) Near-pack 
B) Bonus-pack 
C) On-pack 
D) In-pack 
E) Add-on

Question 50

The toy inside of a box of breakfast cereal is an example of a(n)_____.

A) add-on promotion 
B) self-liquidating offer 
C) in-pack premium 
D) hedonic premium 
E) bonus pack

Question 51

Larkin Manufacturing wishes to reinforce their brand's image.It would be most effective for them to use _____.

A) rebates 
B) sampling 
C) price-off deals 
D) continuity programs 
E) self-liquidating offers

Question 52

To increase sales of Mountain Pure bottled water,the company is considering using a price-off offer.Which of the following would NOT represent a reasonable objective for using this form of sales promotion? 

A) The company wants to reward present users for their past brand allegiance. 
B) The company wants to load consumers. 
C) The company wants to establish repeat purchase. 
D) The company wants to ensure that promotional dollars do in fact reach consumers. 
E) None of these are correct.

Question 53

For which type of premium do consumers receive a free item from the sponsoring manufacturer in return for submitting a required number of proofs of purchase? 

A) free-with-purchase premium 
B) mail-in offer 
C) in-pack premium 
D) near-pack premium 
E) self-liquidating offer

Question 54

Managers must be circumspect in choosing premium items that are compatible with the _____ and appropriate for the _____.

A) retail image; shelf space available 
B) firm's product line; retail outlet 
C) brand's image; target market 
D) competitive premiums; firm's image 
E) economic conditions; cultural norms

Question 55

Self-liquidating premiums are paid for by the _____.

A) manufacturer 
B) wholesaler 
C) retailer 
D) consumer 
E) sales force

Question 56

For manufacturers,the Buy X,Get 1 Free form of premium serves the primary purpose of _____.

A) reinforcing brand image 
B) creating long-term relationships with customers 
C) enhancing advertising efficiency 
D) rewarding a brand's loyal customers or encouraging trial 
E) reinforcing other marketing communications messages

Question 57

Free-with-purchase premiums are also called _____.

A) self-liquidating offers 
B) mail-in offers 
C) free-gift-with-purchase premiums 
D) bonus packs 
E) bonus premiums

Question 58

A local ice cream store has a new maze and children's jokes on their bags every month.The maze and jokes on the bag is an example of a(n)_____.

A) self-liquidating offer 
B) on-pack premium 
C) near-pack premium 
D) mail-in offer 
E) game

Question 59

To promote sales and increase consumer awareness of good eating habits,a well-known cereal manufacturer included on the package an offer for a book entitled Good Eating and Lifetime Happiness.This book (a $9 value)could be obtained in exchange for only one proof-of-purchase along with $4.95 shipping and handling.What type of promotional tool is the company using? 

A) out-of store coupon 
B) basic-offer premium 
C) on-pack premium 
D) self-liquidating offer 
E) rebate

Question 60

Every year,retailers set up elaborate displays for Christmas merchandise.One retailer set up a display with several children's books for Christmas.One book offered a free ornament with the purchase of the book,and the ornaments were in a bin next to the book display.Consumers purchasing the book could also take an ornament.This is an example of a(n)_____.

A) self-liquidating offer 
B) on-pack premium 
C) in-pack premium 
D) near-pack premium 
E) add-on premium

Question 61

The major reason manufacturers are using rebates more now than ever is that many consumers never bother to redeem them.Thus,when using rebates,manufacturers get the best of both worlds-they stimulate consumer purchases of rebated items without having to pay out the rebated amount because most consumers do not undertake the effort to mail in rebate forms.Hence,rebates can be thought of as a form of _____.

A) premium 
B) phantom discount 
C) coupon 
D) overlay promotion 
E) bounce-back allowance

Question 62

Sun Cosmetics is sponsoring a promotional campaign in which consumers who send in an entry form have the chance to win a trip to Hawaii or hundreds of lesser gifts.What type of promotional tool is being used here? 

A) tie-in promotion 
B) sweepstakes 
C) cooperative coupon 
D) contest 
E) mail-in offer

Question 63

Which of the following is one of the manufacturer's disadvantage of using price-offs? 

A)  the retailer must provide display materials to announce the price-off label offer 
B)  there must be a hiatus of at least 45 days between price-off label promotions on any given brand size 
C)  they can be used only on new products 
D) retailers often dislike price-offs 
E) All of these are correct.

Question 64

Games provide consumers with a(n)_____ reward and,for marketers,serve primarily to _____.

A) delayed; encourage trial by nonusers 
B) delayed; encourage repeat purchasing 
C) delayed; reinforce a brand's image 
D) immediate; encourage trial by nonusers 
E) immediate; encourage repeat purchasing

Question 65

Online sweepstakes and contests (along with online games)appeal to consumers and also further the interest of brands by ______.

A) enabling the expansion of a brand's opt-in e-mail database 
B) building consumer interaction with the brand 
C) creating awareness 
D) a and b only 
E) a, b, and c

Question 66

Which of the following are sometimes used as an alternative to price-off deals when price-off deals are either overused or resisted by the trade? 

A) coupons 
B) rebates 
C) add-ons 
D) premiums 
E) bonus packs

Question 67

For which type of promotion are winners determined purely on the basis of chance? 

A) games 
B) contests 
C) sweepstakes 
D) games and contests 
E) games, contests, and sweepstakes

Question 68

Every year,Dana enters the Pillsbury Bake-off.She submits a recipe that uses at least one Pillsbury baking product to a panel of judges.One hundred participants are invited to compete further by actually preparing their recipes for judges so that a grand prize winner can be selected,winning one million dollars.This is an example of which type of promotion? 

A) sweepstake 
B) game 
C) contest 
D) lottery 
E) cooperative promotion

Question 69

Compared with many other sales-promotion techniques,sweepstakes are _____.

A) relatively inexpensive 
B) simple to execute 
C) able to reinforce a brand's image 
D) able to reach specific groups 
E) All of these are correct.

Question 70

As promotion manager for a candy bar manufacturer,your objective is to create a sales promotion that will provide consumers with an immediate reward while achieving a repeat purchase objective for your company.Which of the following would effectively serve these purposes? 

A) mail-in offer 
B) contest 
C) sweepstakes 
D) bonus pack 
E) sample

Question 71

Bonus packs provide consumers with a(n)_____ reward and,for manufacturers,primarily serve a _____ objective.

A) immediate; repeat purchase 
B) immediate; generating trial 
C) immediate, reinforcing brand image 
D) delayed; repeat purchase 
E) delayed; generating trial

Question 72

The Federal Trade Commission states that _____.

A) there is a limit of six price-off label promotions per year per brand size 
B) there must be a hiatus period of at least 60 days between price-off label promotions on any given brand size 
C) price-off labels may only be used on brands already in distribution with established retail prices 
D) no more than 30 percent of a brand's volume over a 12-month period may be generated from price-off label promotions 
E) the retailer must provide display materials to announce the price-off label offer

Question 73

For which type of promotion must participants act according to the specific rules and may or may not be required to submit proofs of purchase? 

A) tie-in promotions 
B) sweepstakes 
C) cooperative promotions 
D) contest 
E) self-liquidating promotion

Question 74

Listerine mouth wash provided customers with a free 250ml bottle along with the purchase of a 1.7L bottle.This promotional offer would be categorized as a(n)_____.

A) near-pack premium 
B) bonus pack 
C) on-pack premium 
D) price-off promotion 
E) add-on bonus

Question 75

The ABC Company usually sells a package of ten razor blades for $9.00.When the company offers a package of twelve razor blades for $9.00,they are offering a _____.

A) self-liquidating offer 
B) bonus pack 
C) price-off promotion 
D) rebate 
E) sample

Question 76

Cash discounts given to consumers who submit proofs of purchase are known as _____.

A) coupons 
B) premiums 
C) rebates 
D) price-offs 
E) bonus packs

Question 77

Which of the following can participate in rebate fraud by failing to fulfill them? 

A) consumers 
B) retailers 
C) manufacturers 
D) government 
E) retailers and manufacturers

Question 78

_____ are extra quantities of a product that a company gives to consumers at the regular price.

A) Price-offs 
B) Premiums 
C) Bonus packs 
D) Add-ons 
E) Rebates

Question 79

Lisa purchased socks at a department store and noticed a sign that stated she could get $5.00 back by mail if she purchased five pairs and mailed in a form along with the proofs of purchases and a dated cash register receipt.This is an example of which type of promotion? 

A) coupon 
B) rebate 
C) premium 
D) bonus pack 
E) price-off

Question 80

Which of the following is FALSE regarding rebates? 

A) Rebates are also called refunds. 
B) Automobile companies are among the major users of rebate programs. 
C) Many consumers never bother to redeem them. 
D) Rebates offer consumers immediate rewards. 
E) Rebate fraud occurs by manufacturers, retailers, and consumers themselves.