History of Sales Promotion

History of

Advertising has a long and fascinating history and has had a major impact, both good and bad, on our culture. Advertising has entertained, moved, and motivated consumers for more than a century, and many of the images created by advertisers have become cultural icons—Ronald McDonald, the Marlboro Man, Tony the Tiger, and the Energizer Bunny, to name just a few. Much has been written about the history of advertising and how it reflects society and its whole range of activities. However, sales promotion also has a very rich and interesting history: have developed and used a variety of techniques over the past century to give consumers an extra incentive to use their products and services. Many of the sales promotion offers that motivate consumers today and have become part of their everyday lives have been around for nearly a century or more.

The oldest, most widely used, and most effective sales promotion tool is the cents-off coupon. have been around since 1895 when the C.W. Post Co. first began using the penny-off coupon to help sell its new Grape Nuts cereal brand. Procter & Gamble began using in 1920, and its first ones were metal coins that were good for discounts or buy-one-get-onefree deals. Those were soon replaced by cheaper, more convenient paper versions, which have been around ever since. Another classic promotional tool is the premium offer, which dates back to 1912 when Cracker Jack began offering “a prize in every box.” Ovaltine developed one of the first interactive premiums in 1930, when it gave away decoder rings that were needed to decode secret messages broadcast in Little Orphan Annie radio shows in the 30s. The promotion was brought back 20 years later as television became the new mass medium and the rings were used to decode messages in Texas Rangers TV shows. Perhaps no company has used premium offers as effectively as McDonald’s, which launched its Happy Meals in 1979 and has been using them ever since. Happy Meals account for a significant portion of McDonald’s sales and have made the company the world’s largest toy manufacturer.

Marketers also have a long history of taking their promotional programs to the customer. The first Oscar Mayer Wienermobile hit the streets in 1936, when the nephew of the company’s founder had the idea of introducing a 13-footlong hot dog on wheels. Soon it was seen driving the streets of Chicago, promoting Oscar Mayer “German Style Wieners.” Seven updates and 66 years later, there is now a fleet of eight Wienermobiles that cruise the highways of America and other countries playing 21 versions of the famous Wiener Jingle and helping to promote the brand. Pepsi is another company that took a promotional program on the road, with its launch of the famous “Pepsi Challenge” in 1975, which was one of the most successful promotions ever used to attract users of a competing brand. Pepsi took on its archrival and industry leader Coca-Cola in a hard-hitting promotion that challenged consumers to taste the two brands in blind taste tests. Pepsi ran the challenge promotion for nearly a decade and relaunched it again in 2000 as it began cruising for a new generation.

Contests and sweepstakes also have an interesting history. Pillsbury launched its first Bake-Off Contest in 1949, when the company’s advertising agency created the contest to celebrate the company’s 80th birthday and invited homemakers to share their treasured recipes. The response was so great that Pillsbury decided to hold the contest again in subsequent years, and the Bake-Off has become an institution as well as the nation’s most prestigious cooking competition. Many of the winning recipes in each year’s competition have become part of the repertoire of home cooks and have led to innovative new products from Pillsbury.

McDonald’s has taken another institution, the world-famous Monopoly board game, and turned it into a long-running and immensely popular contest. The first McDonald’s Monopoly game contest was in 1987, and its collect-and-win format and big prizes generated tremendous interest and excitement and was very effective at generating repeat business. McDonald’s began running the game annually in 1991, tweaking it each year by adding new partners and prizes and making the game more complex with new iterations such as the Pick Your Prize twist. However, in 2001 the game had the most surprising twist of all: The FBI used it to collect evidence against an embezzlement ring that had been stealing high-value game pieces throughout the years. It remains to be seen if McDonald’s will try to bring back the popular game.

Another promotional program of historical significance is the American Airlines AAdvantage frequentflier program, which was launched in 1981. The program created a new currency and has set the gold standard for loyalty marketing as it now has nearly 44 million members. American also has a steady stream of partners that offer AAdvantage miles as an incentive to encourage consumers to purchase their products and services. Loyalty programs have also become very prevalent in many other industries such as hospitality, rental cars, and retailing.

Many of the marketers discussed here are promotional pioneers, as they have found creative ways to provide consumers with an extra incentive to purchase their brands. The success of these promotions has had a major impact on consumers throughout the years and also has resulted in similar programs being developed by competitors. Such promotions show that advertising is not the only IMC tool with a rich and interesting history.

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