QUANTITATIVE RESEARCH

Author: Dubray, Jolene M.
Add. Authors: Schwartz, Robert M.
                       Garcia, John M.
                       Bondy, Susan J.
                       Victor, J. Charles 

Canadian Journal of Public Health March-April 2009, v100 i2, p109(4)

Abstract:
Objective: On May 31, 2006, Ontario joined a small group of international jurisdictions to implement legislative restrictions on tobacco point of sale promotions. This study compares the presence of point of sale promotions in the retail tobacco environment from three surveys: one prior to and two following implementation of the legislation.
Method: Approximately 1,575 tobacco vendors were randomly selected for each survey. Each regionally-stratified sample included equal numbers of tobacco vendors categorized into four trade classes: chain convenience, independent convenience and discount, gas stations, and grocery. Data regarding the six restricted point of sale promotions were collected using standardized protocols and inspection forms. Weighted estimates and 95% confidence intervals were produced at the provincial, regional and vendor trade class level using the bootstrap method for estimating variance.
Results: At baseline, the proportion of tobacco vendors who did not engage in each of the six restricted point of sale promotions ranged from 41% to 88%. Within four months following implementation of the legislation, compliance with each of the six restricted point of sale promotions exceeded 95%. Similar levels of compliance were observed one year later. Grocery stores had the fewest point of sale promotions displayed at baseline. Compliance rates did not differ across vendor trade classes at either follow-up survey. Point of sale promotions did not differ across regions in any of the three surveys.
Conclusion: Within a short period of time, a high level of compliance with six restricted point of sale promotions was achieved.
Key words: Tobacco; marketing; compliance
Objectif: Le 31 mai 2006, l'Ontario s'est jointe a un petit groupe de competences internationales pour mettre en oeuvre des restrictions legislatives sur la publicite dans les points de ventes du tabac. Cette etude compare la presence de publicite sur le tabac dans les points de vente dans un environnement de vente au detail du tabac a partir de trois etudes: une avant la mise en oeuvre des mesures legislatives, et deux apres cette mise en oeuvre.
Methode: Environ 1 575 vendeurs de tabac ont ete selectionnes au hasard pour chaque etude. Chaque echantillon stratifie par region comprend un nombre egal de vendeurs de tabac classes selon quatre categories de commerce: les depanneurs sous banniere, les depanneurs independants, les postes d'essense-depanneurs et les epiceries. Les donnees relatives a la publicite dans six points de vente restreints ont ete recueillies a l'aide de protocoles normalises et de formulaires d'inspection. Les estimations ponderees et 95 % des intervalles de confiance ont ete produits au niveau provincial, regional et des categories de commerce a l'aide de la methode bootstrap pour estimer la variance.
Resultats: A la base, la proportion de vendeurs de tabac qui ne participaient pas a la promotion de chacun des six points de vente restreints variait entre 41 % et 88 %. Quatre mois apres la mise en oeuvre des mesures legislatives, la conformite a la promotion de chacun des six points de vente restreints excedait 95 %. Des niveaux similaires de conformite ont ete observes un an plus tard. Les epiceries affichaient le moins de publicite au point de vente a la base. Les taux de conformite n'ont pas differe parmi les categories de commerce lors de l'etude de suivi. La publicite dans les points de vente n'a pas differe dans les regions dans aucune des trois etudes.
Conclusion: Au cours d'une courte periode, un niveau eleve de conformite avec la publicite dans les six points de ventre restreints a ete atteint.
Mots cles: tabac; commercialisation; conformite 

External:
Point of sale promotion of tobacco products constitutes an important pillar in tobacco industry marketing efforts. Severe restrictions on other forms of public advertising for tobacco products increase the importance of in-store promotions. Aggressive point of sale advertising includes power walls (i.e., cigarette displays that exhibit cigarette brand associated colours, three-dimensional displays and promotional lighting), countertop displays and signs advertising tobacco products. In 2006, the tobacco industry spent $107 million on point of sale promotions in Canada, including $40 million in Ontario alone. (1) A study conducted in California estimated that, on average, there were 17.2 cigarette advertisements and promotional materials in each of the surveyed tobacco vendors. (2) Moreover, significantly more cigarette marketing has been observed in retail environments where adolescents frequently shop, particularly for cigarette brands that are popular among adolescents, (3) and in stores within 1000 feet of a school. (4)
A number of recent studies address the effects of retail cigarette advertising on youth. Cigarette advertisements at point of sale have been shown to increase brand user imagery in a positive direction among adolescents. (5) Another study found that the prominence of cigarettes at point of sale increased adolescents' perceptions about the ease of illegally purchasing cigarettes, while the combined presence of cigarettes and advertising at point of sale decreased their perception of being asked for proof of age. (6) Frequent exposure to retail cigarette marketing has been found to significantly increase the odds of smoking susceptibility (7) and ever smoking among adolescents. (7,8) Furthermore, cigarette promotions have been associated with influencing youth who were already experimenting with cigarettes to progress to regular smoking, and established smokers being most influenced by promotional offers. (9)
Despite the apparent detrimental effects of point of sale promotions in promoting cigarette smoking, few jurisdictions have implemented legislation that bans or restricts tobacco point of sale promotions. Eleven of Canada's 13 provinces and territories and 6 international jurisdictions (Iceland, Thailand, United Kingdom, South Africa, New Zealand, and Australia) currently have tobacco point of sale promotion restrictions in force. (10) Ontario joined this small group of pioneers in May 2006. To date, only New Zealand has published compliance rates with regards to the point of sale restrictions. In that study, 64% of stores surveyed were noncompliant with at least one of the point of sale regulations three years after the regulations were put in place. (11)
On May 31, 2006, Ontario implemented the Smoke-Free Ontario Act (SFOA), (12) restricting tobacco point of sale promotions in any place where tobacco products are sold. The SFOA also strengthens youth access restrictions and restricts smoking in enclosed workplaces and public places. SFOA restrictions on tobacco point of sale promotions include a ban on: a) countertop displays; b) displays that permit handling by a purchaser prior to purchase; c) displays of cigarette cartons; d) decorative, illuminated panels; e) three-dimensional exhibits; and f) outside promotional displays. A complete ban on tobacco displays came into effect on May 31, 2008.
Using a cross-sectional study design with provincially representative samples of tobacco vendors, this study compares the presence of point of sale promotions captured in three surveys: one prior to and two following the SFOA implementation.
METHODS
Setting
Enforcement of the SFOA is funded by Ontario's Ministry of Health Promotion and is administered through 36 local public health units. Tobacco Enforcement Officers in each public health unit are responsible for conducting three types of routine inspections to assess compliance with the SFOA: youth access to tobacco products; tobacco point of sale promotions; and smoke-free enclosed workplace and public places. All inspections are conducted using standardized inspection protocols and inspection forms.
The 36 public health units are geographically grouped into seven regions known as Tobacco Control Area Networks (TCAN). The number of public health units within each TCAN ranges from 1 in the Toronto TCAN to 9 in the South West TCAN.
Sample
Three separate stratified random samples of tobacco vendors were drawn for the baseline and two follow-up surveys. Sample selection was stratified by region (public health unit within TCAN) and vendor trade class. Applying precision-based sample size calculations, roughly 240 tobacco vendors were randomly selected within each TCAN for each survey. Due to the smaller number and geographic distribution of tobacco vendors, the two northern TCANs were collapsed into a single northern area and 300 tobacco vendors were selected from the newly combined northern area. Each survey sample represented approximately 5% of the tobacco vendors in the largest TCAN (Toronto) and 28% of tobacco vendors from the smallest TCAN (combined northern area). Within each TCAN, tobacco vendors were selected in numbers proportional to the total number of tobacco vendors in each public health unit.
Five vendor trade classes were included in this study: chain convenience stores, independent convenience and discount stores, gas stations, grocery stores, and restaurants (baseline survey only). Restaurants were not included as a vendor trade class in the followup surveys due to the decreasing number of restaurants selling tobacco products following implementation of the SFOA. Equal numbers of tobacco vendors were selected in each of the vendor trade classes. In total, 1,594 tobacco vendors were selected for the baseline survey, 1,575 for the first follow-up survey, and 1,576 for the second follow-up survey.
Data collection
Data for all three surveys were collected by public health unit enforcement staff as part of their routine responsibilities. Using a standardized inspection form, enforcement staff collected information on the presence of six point of sale promotion prohibitions: a) countertop displays; b) display that permits handling by a purchaser prior to purchase; c) display of cigarette cartons; d) decorative, illuminated panels; e) three-dimensional exhibits; and f) outside promotional displays. Data were collected between April 18 and May 9, 2006 for the baseline survey; September 18 and October 8, 2006 for the first follow-up survey; and May 22 and June 11, 2007 for the second follow-up survey. Inspections were completed in approximately 90% of selected tobacco vendors during all three surveys.
Data analysis
[Graphic omitted]All analyses were conducted using SAS version 9.1. (13) The data were weighted by the inverse of their sampling probability such that the sum of their weights represents the tobacco vendor population within each public health unit. Weighted estimates of the rate of tobacco vendor compliance with the point of sale prohibitions were calculated at the provincial, vendor trade class, and TCAN levels. Due to small numbers of tobacco vendors within some of the strata, the bootstrap (14) method for estimating variance was applied to all analyses. For the purpose of comparing similar vendor populations in the baseline and follow-up surveys, the restaurant vendor trade class was excluded from the baseline survey analyses. At baseline, the proportion of restaurants that did not engage in each of the six point of sale promotion prohibitions exceeded 90%. Significant differences between surveys were determined by Pearson's [chi square] (provincial level) and two-sample t-tests (vendor trade class and TCAN levels).
To facilitate tobacco vendor trade class and geographic comparisons between the baseline and follow-up surveys, a point of sale (POS) index score was created. The 6-point index score was calculated by summing the number of point of sale promotional activities in which each vendor was not engaged. For example, a score of 6 indicates that a vendor did not engage in any of the six point of sale promotional activities and a score of 0 indicates that a vendor was engaged in all six point of sale promotional activities.
University of Toronto ethics approval was sought for this study. Collection of compliance data was deemed quality assurance and exempted from review.
RESULTS
Provincial level
The proportion of tobacco vendors who did not engage in each of the six point of sale promotions ranged from 41% to 88% in the baseline survey (Table 1). This contrasts sharply with data from both follow-up surveys, where the proportion of tobacco vendors in compliance with each of the six point of sale promotions exceeded 94%. The greatest change between surveys was observed in the decorative, illuminated panels (41% at baseline to 98% at first follow-up; p<0.001). Tobacco vendor compliance did not differ between the first and second follow-up surveys. In total, about 88% of vendors were compliant with all six point of sale promotion prohibitions in both follow-up surveys, up from the 16% of vendors who did not engage in any of the six point of sale promotions at baseline.
Vendor trade class level
The province-wide mean POS index score increased from 3.75 at baseline to 5.88 at first follow-up (p<0.001) to 5.92 at second followup. At the baseline measurement, mean POS index scores ranged from a low of 3.07 for chain convenience stores to a high of 4.84 for grocery stores (p<0.001; Figure 1). At both follow-ups, there was no significant difference in mean POS index scores across vendor trade classes.
[FIGURE 1 OMITTED]
TCAN level
At baseline, mean POS index scores ranged from 3.41 in the Central West TCAN to 4.22 in the South West TCAN (Figure 2). By the time of the first follow-up survey, all TCANs achieved significantly higher mean POS index scores, ranging from 5.81 in Central East TCAN to 5.96 in Eastern TCAN. There was no significant difference in mean POS index scores between the two follow-up surveys or across TCANs in all three surveys.
DISCUSSION
This study found that within a short time period following implementation of a tobacco point of sale legislation, vendor compliance with such restrictions was very high across vendor trade classes and TCANs. Furthermore, vendor compliance remained at a high level one year following implementation of the SFOA. These findings are encouraging for the implementation of a total display ban on May 31, 2008.
[Graphic omitted]There are three possible reasons for success of the ban as evidenced by compliance. The first is the comprehensive education campaign conducted by the Ontario Ministry of Health Promotion together with the public health units in the months leading up to implementation of the SFOA. The comprehensive education campaign included educational mail-outs to tobacco vendors, educational visits by tobacco enforcement staff to premises, group educational sessions, and detailed media coverage of the restrictions prior to May 31, 2006.
Another reason for success is the regular presence of enforcement staff at tobacco vendors due to other legislative components of the SFOA. Since 1994, Ontario public health units have been required to conduct routine annual youth access compliance checks on tobacco vendors in the province. The net effect of the long enforcement history and added enforcement presence on site might encourage higher levels of voluntary compliance in other restrictions of the SFOA, such as the point of sale restrictions, via the theory of perceived risk. (15)
A third reason for success is that vendors might be more likely to comply with point of sale regulations due to the physical presence of point of sale promotions, similar to smoking in restaurants. Non-compliance in either situation would exhibit the premise in a blatant and public illegal activity.
[Graphic omitted]Since tobacco point of sale restrictions are relatively new to the field of tobacco control, there is very little scientific literature describing the state of compliance within jurisdictions that have point of sale restrictions similar to Ontario. This study is important as it is the first study reported in the scientific literature that evaluated the change in the presence of point of sale promotions before and after implementation of a point of sale legislation.
A limitation to this study is that compliance could not be calculated at the public health unit level. Also, this study did not include reasons for vendor non-compliance.
In conclusion, there was a significant change in the presence of point of sale promotions within four short months and one year following implementation of the SFOA. About 12% of the tobacco vendor population in Ontario remains non-compliant with at least one of the six point of sale restrictions. Further study is required to explore the characteristics of non-compliant vendors and the possible explanations for continued non-compliance.
Received: March 25, 2008
Accepted: September 29, 2008
REFERENCES
(1.) Canadian Cancer Society. Tobacco manufacturer payments to retailers to display tobacco products and signs, Canada, 2001-2006, 2007.
(2.) Feighery EC, Ribisl KM, Schleicher N, Lee RE, Halvorson S. Cigarette advertising and promotional strategies in retail outlets: Results of a statewide survey in California. Tob Control 2001;10(2):184-88.
(3.) Henriksen L, Feighery EC, Schleicher NC, Haladjian HH, Fortmann SP. Reaching youth at the point of sale: Cigarette marketing is more prevalent in stores where adolescents shop frequently. Tob Control 2004;13(3):315-18.
(4.) Cohen JE, Planinac LC, Griffin K, Robinson DJ, O'Connor SC, Lavack AM, et al. Tobacco promotions at point-of-sale: The last hurrah. Can J Public Health 2008;99(3):166-71.
(5.) Donovan RJ, Jancey J, Jones S. Tobacco point of sale advertising increases positive brand user imagery. Tob Control 2002;11(3):191-94.
(6.) Wakefield M, Germain D, Durkin S, Henriksen L. An experimental study of effects on schoolchildren of exposure to point-of-sale cigarette advertising and pack displays. Health Educ Res 2006;21(3):338-47.
(7.) Feighery EC, Henriksen L, Wang Y, Schleicher NC, Fortmann SP. An evaluation of four measures of adolescents' exposure to cigarette marketing in stores. Nicotine Tobacco Res 2006;8(6):751-59.
(8.) Henriksen L, Feighery EC, Wang Y, Fortmann SP. Association of retail tobacco marketing with adolescent smoking. Am J Public Health 2004;94(12):2081-83.
(9.) Slater SJ, Chaloupka FJ, Wakefield M, Johnston LD, O'Malley PM. The impact of retail cigarette marketing practices on youth smoking uptake. Arch Pediatr Adolesc Med 2007;161(5):440-45.
(10.) Ontario Tobacco Research Unit. The Tobacco Control Environment: Ontario and Beyond. [Special Reports: Monitoring and Evaluation Services, 2007-2008 (Vol. 14, No. 1).] Retail Display of Tobacco Products: Monitoring Update. Toronto, ON: Ontario Tobacco Research Unit, 2008.
(11.) Anand S, Crawford A, Ng B, Blakiston M, Quedley M, Devadas R, et al. Cigarettes and candy: A study of retailer compliance with the point of sale tobacco display regulations in the 2003 smoke-free environments amendment act. Wellington, NZ: Cancer Society of New Zealand, 2006.
(12.) Government of Ontario. Smoke-Free Ontario Act (2005).
(13.) SAS Institute. SAS v. 9.1. 2006.
(14.) Efron B, Tibshirani RJ. An Introduction to the Bootstrap. New York, NY: Chapman and Hall, 1993.
(15.) Becker GS. Crime and punishment: An economic approach. J Political Economy 1968;76(2):169-217.
Jolene M. Dubray, MSc, [1] Robert M. Schwartz, PhD, [1,2] John M. Garcia, PhD, [1,3] Susan J. Bondy, PhD, [1,2] J. Charles Victor, MSc [1]
Author Affiliations
[1.] Ontario Tobacco Research Unit, Toronto, ON
[2.] Dalla Lana School of Public Health, University of Toronto, Toronto, ON
[3.] Cancer Care Ontario, Toronto, ON
Correspondence and reprint requests: Ms. Jolene Dubray, Ontario Tobacco Research Unit, c/o Dalla Lana School of Public Health, University of Toronto, 155 College Street, Unit 530, Toronto, ON M5T 3M7, Tel: 416-978-3051, Fax: 416-946-0340, E-mail: jolene.dubray@utoronto.ca
Acknowledgements: This study was funded by the Ontario Ministry of Health Promotion. We would like to thank the public health unit enforcement staff who collected the data for this study.

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The Advertising and Promotion of Print since the Fifteenth Century

Walker, George A. (2010)
Papers of the Bibliographical Society of Canada Spring 2010, v48 i1, p212(3) 

Robin Myers, Michael Harris, and Giles Mandelbrote, eds. Books for Sale: The Advertising and Promotion of Print since the Fifteenth Century. New Castle: Oak Knoll Press; London: The British Library, 2009. 256 pp.; US $49.95 ISBN 9781584562658
For the book lover, looking for a book that inspires and entertains is a passion that never dies. How we discover book treasures is a combination of serendipiry and the cunning promotional efforts of the publisher and bookseller. It will come as no surprise then that the history of advertising and promotion in the book trade is rich with remarkable stories. Books for Sale is a collection of papers delivered at the thirteenth annual Book Trade History conference held at the Foundling Museum in London, England, in November 2008. As the subtitle suggests, the topics covered span from incunabula to the Internet and give us a broad picture of the experiments and innovations in book promotion that have driven sales for the past five hundred years.
Robin Myers sets the tone for this collection by providing a solid introduction to the study of the business of bookselling and introducing us to the topics covered by the eight authors. The first essay, by Lotte Hellinga, gives us an ample account of the surviving advertisements (44 in total) from the fifteenth century. Julianne Simpson traces the sale and distribution of Christopher Plantin's Biblia Regia completed in 1572. Simpson provides us with evidence of Plantin's shrewd business acumen and his innovative use of printed advertisements for books. Ali this information she collected from her research at the Plantin archives in Antwerp.
When does printed information become advertising? Michael Harris addresses this issue as a subtext in his essay on eighteenthcentury advertising and throws light on the symbiotic relationship of advertising in the promotion of printed material and consumer goods. This essay is not about the advertising of books as much as it is about the role of advertising in print. Harris examines the business of John Houghton and how his printed matter diversified and cross-subsidized other ventures such as medical cures. The essay is illustrated with reproductions from various publications and gives usa picture of the blurred lines between what is information for the public good and what is mercantile commercialism. Building on this, Phillippa Plock's essay inspects the world of eighteenth-century trade cards preserved in Lord Rothschild's Waddesdon Manor in Buckinghamshire, England. Plock focuses on the Parisian book trade and the use of "visual rhetoric" to persuade wealthy recipients to purchase books. Six reproductions of these cards illustrate this style of advertising and give usa glimpse into their power to convince and intrigue.
Charles Benson invites the reader to explore the Irish book trade and its expansion in the nineteenth century. He is the Keeper of Early Printed Books at Trinity College in Dublin, Ireland, which gives him a unique advantage to peruse the collection of advertising ephemera there. Benson discusses the considerable advertising expenditure made by Irish publishers to promote their projects by the use of newspapers, magazines, wrappers, inserts and subscriptions and promotional offers. One interesting detail about the publication of Deighan's A Complete Treatise on Arithmetic (1804) is that the publisher printed the names of subscribers in the book if they paid the full price in advance. Deighan's book also contained advertisements (as was the custom) for other editions. Benson also describes how the printing of testimonials and endorsements was a popular practice to encourage buyers. Although these new advertising methods were not unique they are an example of how the publishing trade in Ireland flourished as it embraced the emerging age of persuasion.
Alan Powers discusses the appearance of a powerful device for catching the reader's eye and providing a stage for endorsements and promotional blurbs--the dust jacket. It is interesting to note that Marshall McLuhan declared the future of the book to be: "the blurb." The importance of the dust jacket as an advertisement and a surface for the display of design and art was underappreciated. Today we take the dust jacket for granted as a mark of a properly packaged, hardcover trade book, but there was a time when it was an innovation, a sign of modernist novelty by which the publishing industry and readers distinguished the new from the old. Many despised it and thought it a waste of paper. Powers explains with illustrations of popular jackets how the paper wrapper book jacket emerged as an advertising device. Today, of course, early dust jackets are prized items for collectors, precisely because so few survived the initial contempt with which they were greeted.
What does the world of literary prizes have to do with bookselling? Everything, it seems, and Peter Straus outlines their impact on sales in Britain and its tangent markets. Straus's experience as a literary agent is evident in his insider's understanding of book marketing and the impact a prize may (or may not) have on sales. A breakdown of the implications of the Booker prize on Rushdie's Midnight's Children gives the reader a care insight into the actual numbers publishers must consider when developing their profit and loss projections. This is a good article that could be expanded to include the impact of the new mass-market technologies of the Internet and mobile devices and how these have contributed to the impact of literary awards on sales.
The impact of the Internet is the focus of Udo Gollmann's article. Gollmann is an ABE Books employee in Europe who provides a survey of the effects of digital technology on book sales. Gollmann predicts that the future of the printed book will remain intact and that it will only be a more treasured and sought after commodity as digital technologies improve. Missing from Gollmann's prediction is the impact of digital piracy on the book trade and the role of the Google settlement on future printed books sales. As publishers struggle to find a business model for book sales in the light of new technologies like the Amazon Kindle and the Apple iPad, it is becoming increasingly apparent that a seismic shift in the culture of bookselling is on the horizon. Complete with contributors' bios and an index, Books for Sale gives us the perspective to reflect upon the book technologies that have driven sales and changed our relationship with reading.
GEORGE A. WALKER
Ontario College of Art & Design

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Relationship between sale promotions, duration of receiving reward and customer preference: a case study on financial products

Boonlertvanich, Karin (2010)
 Journal of Academy of Business and Economics Jan 2010, v10 i1, p53(12)

Abstract: 

Under current competitive environment in the banking industry, coupled with the fact that dissimilarity between each bank's financial products has been gradually dissolved, many banks are now competing on sales promotion differentiation for their customer acquisition. The purpose of this study is to examine the influence of sale promotion and the duration of receiving reward on customer preference, as well as the contingent effect from different types of financial products. Types of sales promotion studied are monetary and non-monetary promotions, while the duration of receiving reward is separated between instantaneous and delayed reception. There are four types of financial products in this study: fixed deposits, credit cards, mutual funds and bancassurances. Utilizing three-way ANOVA analysis, the findings revealed that sales promotions in monetary terms are more preferable than those in non-monetary terms for all products. Also, an instant-reception of a reward is preferred over a delayed-reception. The contingent effect of product types has a significant impact on the relationship between the type of promotion and customer preference. Offering a monetary promotion on a credit card product is more effective than offering a monetary promotion on other products. However, the contingent role of the product category has no impact on the relationship between reward reception duration and customer preference.
Keywords: Sales promotions, monetary promotion, delayed-reward promotion, customer preference


External:
1. INTRODUCTION
Sales promotion is one of the key marketing mix used as a tool to increase short-run sales, to attract new customers and to retain existing customers, as well as a tool to stimulate repurchasing behavior. For the industry or business that is in its mature phase of the business cycle, product or service quality can no longer be the key differentiation. As a result, greater market competition in this kind of industry usually leads to the greater role of sale promotions. The classical style of promotions such as price reduction, refunds or sweepstakes have been transformed into a more complex and diverse form, such as reward point redemption or privileged service offerings (Kotler, 2000).
The effect of monetary promotion on consumer attitudinal and behavioral responses has been intensively studied (Dobson et al, 1978, Gupta, 1988). It is of particular importance for researchers to investigate how the monetary promotion, such as coupon promotion, affects customer perceived value on products and services and how it impacts brand loyalty in the long-run (Alvarez & Casielles, 2005, Darke & Chung, 2005, Dawes, 2004, Garretson & Burton 2003, Krishna & Zhang 1999).
In contrast, the effect of non-monetary promotions on customer preference has been less investigated (Palazon-Vidal & Delgado-Ballester, 2005). Despite their lower impact on customer preference, non- monetary promotions can be considered as an alternative promotional tool especially for preserving long- term brand equity under short-term price or promotional competition.
Existing research usually focused on the effect of different types of promotions on consumer preference in the consumer goods arena (Palazon-Vidal & Delgado-Ballester, 2005, Shu-ling, 2006). Palazon-Vidal & Delgado-Ballester (2005) studied the effect from different types of promotional rewards on consumer preference for generic detergents, paper towels, chocolates and perfumes. Shu-ling (2006) also studied the effects on tissue paper, mobile phones and the CD album market. This kind of research has been absent in studies of financial products, especially the impact of different types of sale promotions on customer preference among each financial product category. Since most of the financial product offerings are now very similar to each other, as financial institutions are subjected to more intense competition, the increase in sales promotion as a tool to increase market share or capture leadership in business has become a preferred strategy among many financial institutions.
The present study proposes that the effects from the different types of sales promotions may vary among different types of financial products, which may be in line with or different from those found in consumer product studies. Credit-related products, e.g. credit cards, may intensify the preferential difference between monetary and non-monetary promotion benefits compared to investment products, including deposits, mutual funds and bancassurances. In addition, it is also hypothesized that a contingent effect from product types on the relationship between the duration of receiving a reward and consumer preference may also exist. The intangible nature of financial products may underline various reference points for assessing the perceived value obtained from an instantaneous reward compared to a delayed reception of a reward. Therefore, the purpose of this study is to focus on the effects of sales promotions and duration of reward reception on customer preferences along with the contingent role of a financial product category.
Bank executives can apply the results from this research in their promotional strategy planning such as the determination on the reward reception period and the type of sales promotion in accordance with customer preference and product types. This helps to reduce the risk and cost from an ineffective promotion campaign, while balancing the tradeoff between monetary promotion and corporate image.
2. LITERATURE REVIEW
2.1 Type of Sales Promotions
Sales promotions can be a direct incentive offers that have value or special incentives for the sales force or distributors aiming primarily on stimulating immediate sales. In this study, only consumer promotions, i.e. direct promotions to the end-consumer of financial products, will be studied. According to Chandon et al (2000), sales promotions can be categorized into two types: monetary promotions and non-monetary promotions.
Monetary promotions are a kind of promotion that enables customers to purchase goods or services at a lower price than the regular price or receive some kind of cash-equivalent gift or voucher, which can be made at the point of sale or occur later. On the other hand, non-monetary promotions usually result in customers purchasing goods or services at the regular price and then receive some kind of courtesy or privilege that cannot easily be converted into cash.
Chandon et al (2000) found that the effectness of monetary sales promotions are similar to the effectiveness of a direct price discount. For non-monetary sales promotion, Palazon-Vidal & Delgado- Ballester-Vidal et al (2005) found that if the promotional reward is the same product as the main purchasing product, customers can evaluate the value of the promotion and may react to the promotion in a similar fashion as when receiving a monetary promotion. In contrast, the effectiveness of a non- monetary promotion, that is very different from the main purchasing product, can be difficult to assess.
Therefore, both monetary and non-monetary sales promotions have their own advantages for customers, but in different aspects.
2.2 Duration of reward receiving
Shu-ling (2006) studied the effect of non-monetary promotions and classified the duration of reward reception into to two types, namely, instant reward and delayed reward reception. D'Astous (2002) studied the effect of promotional premiums and separated the premiums into direct premiums and delayed premiums. Hence, with regard to the reward reception period or time-related sales promotion, two categories of reward reception can be considered:
1. Instant reward reception which enables customers to receive rewards or promotions immediately at the point of sale when they follow the terms of the promotion.
2. Delayed reward reception where the company will send or allow the customers to come back and pick up their reward or promotions for some time period after the sale occurrence.
Typically, the longer the time one needs to wait to receive the reward the less preference the customer has for the reward. This may be due to various factors such as the weariness of waiting, the deterioration of value according to time versus the value of money concept and, the most important factor, the worry or concern over actually receiving the reward at all (Shu-ling, 2006). However, since many financial institutions are now moving toward offering delayed-reception rewards due to corporate and product concern, it is important to study the effect of the duration of reward reception on customer preference across different product types.
2.3 Contingent role of product types
Kotler (2000) classified consumer goods into four main categories, as follows:
1. Convenience goods: products that customers frequently purchase and use with small effort to buy and little comparison shopping, and are suitable for mass promotion.
2. Shopping goods: products that customers will purchase only after comparing various products and brands available. They are usually less frequently purchased products, requiring more shopping effort, and suitable for advertising through local or specialty media and personal selling.
3. Specialty goods: products that customers seek out because of their unique characteristics or brand identification. It usually requires a special effort to purchase a strong brand preference and loyalty, low price sensitivity, and suitable for carefully targeted promotions and personal selling.
4. Unsought goods: products that customers are either unaware of or have little interest in actively pursuing, so that, heavy promotions are often required to sell them successfully.
In this study, despite the fact that financial products are mostly intangible products and are quite different than consumer goods, we tried to select four kinds of financial products that can resemble the aforementioned classification of consumer products. First, fixed-deposits were chosen as a representative of convenience products since they are one of the simplest forms of financial products that all banks offer. Moreover, under the current full-blanket deposit guarantee from the government for all bank deposit accounts, all depositors need not to consider or assess the credit risk of the financial institutions with whom they are establishing a deposit account.
Second, credit cards were chosen as a representative of shopping products due to the variety of types and features currently available among different banks. Third, mutual funds were chosen as a representative of specialty products. Even though mutual fund investments may seem to be popular in most developed countries, they are relatively new to Thai investors. Customers are required to put some effort into understanding investment policy and the risk and return tradeoffs. Finally, bancassurance, particularly life insurance, was chosen as an unsought product. This final product fits reasonably well with the reviewed definition and is usually used as an example of an unsought product in most literature.
Many researches have investigated the contingent effect of product types on the effectiveness among various sales promotions. Bell et al (1999) indicated that different product types result in a different level of sales promotion recognition. For convenience goods, promotional products that use the same product as the one being purchased will provide superior results. In contrast, for shopping products, promotional products that use different products from the one being purchased will provide more effectiveness. In addition, it has been found that instant reward reception yields better results in specialty products compared to convenience products.
Tietje (2002) reported that the relationship between the type of sales promotion and the duration of reward reception will be different for different kinds of products. Therefore, in this study, we investigated the contingent effect of product types on the impact of sales promotion and the duration of reward reception on customer preferences.
[Graphic omitted]2.4 Related Research
Chandon et al (2000) studied the two kinds of customer benefits obtained from sales promotions including utilitarian benefits and hedonic benefits. Also, the research studied two types of sales promotions which are monetary and non-monetary sales promotions. The research found that monetary sales promotions will be more effective for products that provide utilitarian benefits, while non-monetary promotions will be more effective for products providing hedonic benefits especially from a brand awareness aspect.
D'Astous and Landreville (2002) conducted research to investigate customer response to different types of sales promotions for low involvement types of products. The results show that direct premium, e.g. instantaneous reward, results in a more positive preference than delayed premium.
Palazon-Vidal & Delgado-Ballester (2005) found that sales promotions can be used as a marketing tool to enhance brand recognition since it stimulates customer preferences in the product offering. Also, the research revealed that monetary sales promotions would be effective only for utilitarian-based products. On the other hand, non-monetary sales promotions are effective for both utilitarian and hedonic based products.
Shu-ling (2006) studied the impact of non-monetary sales promotions on customer preferences in three types of consumer products, namely, convenience goods, shopping goods and specialty goods. The research results indicated that customers preferred to receive promotional products similar to their purchasing product for convenience and specialty goods, while they preferred to receive promotional products different than their purchasing product for shopping goods. In addition, instantaneous reward is more preferred to delay reward reception for all types of products.
3. RESEARCH OBJECTIVES
Based on reviewed theories and literature, this study aims to integrate various associated elements of sales promotion to the financial product context. As a result the objectives of this research are as follows:.
1. To study the influence of the type of promotions, both monetary promotions and non-monetary promotions, on consumer preferences.
2. To study the influence of the duration of reward reception, both instantaneous and delayed reception, on consumer preferences.
[Graphic omitted]3. To study the contingent impact from types of financial products on the relationship between types of sales promotions, duration of reward reception and consumer preferences.
4. RESEARCH FRAMEWORK AND HYPOTHESES
Although there are a number of research studies on the effects from different types of sales promotions, most of them studied a single aspect one at a time (D. 'Astous and Landreville, 2002; Dawes, 2004; Raghubir, 2004). Studies on a multi-aspect of sales promotions, especially with the contingent role of product types, was limited (Shu-ling, 2006)
In addition, since most of the past research were often done in the context of consumer products, the obtained results may or may not be applicable to financial products, which are intangible in nature and may also contain an embedded financial risk. The research framework of this research, as shown in Figure 1, aimed to achieved the stated objectives and fill in the gaps of knowledge for financial product marketing.
[FIGURE 1 OMITTED]
From the research objectives and the research framework, three research hypotheses can be offered as follows:
H1: Different types of sales promotions, either monetary or non-monetary promotions, have a different impact on customer preferences.
H2: Different durations of reward reception, either instantaneous or delayed reception, have a different impact on customer preferences.
H3: Different types of financial products affect the relationship between types of sales promotions and durations of reward reception on customer preferences.
5. RESEARCH DESIGN AND METHOD
5.1 Sampling and Data Collection
The conducted research surveyed customers who recently purchased at least one financial product during the last three months and had an understanding of all the products. A total sample of 400 surveys was collected from a population in Bangkok. The cluster sampling method was used to first select 10 out of 18 provinces within Bangkok, then a proportionate sampling was used to determine the numbers of required sampling in each province.
[Graphic omitted]In general, the majority of the samples were (1) female (62%), (2) between 25-30 years old (41.5%), (3) completed at least a college degree (70.5%), (4) are working as professionals in private companies (81.5%), and have monthly income between 20,0001-30,000 baht (28.7%), see Appendix A for details.
5.2 Measures
The questionnaire used in this study is divided into 3 parts.
Part 1 is a set of questions for assessing the knowledge of each type of financial products to make sure that respondents have enough product understanding. There were 14 questions.
Part 2 is a set of questions about demographic characteristics of respondents including gender, age, occupation, education level, and monthly income.
[Graphic omitted]Part 3 is composed of questions on customer preferences to promotional advertising by a picture made of 16 color images, without a specific brand of the financial institution, as shown in Appendix B and C. The respondents were requested to indicate the extent to which they prefer or not prefer, based on the offering sales promotions in each financial product type. For each item, a five-point Likert scales anchored by 1 = strongly prefer and 5 = strongly not prefer with 3 = neutral (neither prefer nor not prefer) as the midpoint were utilized. For the reliability evaluation of the questionnaire, the Cronbach's Alpha on customer preferences for each product type were computed and revealed the reliability of the questions, value between 0.8233 and 0.9529.
From Table 1, there are four forms of sales promotion for each financial product, resulting in 16 different print ads questionnaire, similar to Palazon-Vidal & Delgado-Ballester, 2005; Shu-ling, 2006.
6. RESEARCH RESULTS
Table 2 shows the customer preferences on each combination of the sales promotion and duration of reward reception for each product type. In general, it can be seen that monetary sales promotion has higher preferential score than non-monetary promotion and instantaneous reward reception also has higher preferential score than delayed-reward reception. Moreover, sales promotions for credit product, i.e. credit cards, make stronger preference compared to investment products, e.g. fixed deposits, mutual funds and bancassurance.
[Graphic omitted]Results of the first hypothesis testing using a paired sample t-test showed that the test statistic is equal to 8.428 and p-value is less than the 0.05 level of significance. This confirmed that different types of sales promotions have a different impact on customer preferences and monetary sales promotions are more preferred to non-monetary promotions.

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