In-or On-package Premiums

(noun)

usually small gifts, such as toys in cereal or candy boxes

Related Terms

Examples of In-or On-package Premiums in the following topics:

  • Premiums

    • In 1937, the coupons were printed on the outside of packages, and later the Betty Crocker points program produced a popular reward catalog from which customers could pick rewards using their points.
    • One of the first loyalty marketing programs ever offered was a premium in which proof of purchase was redeemed for prizes or gifts.
    • In the United States, each year over $4.5 billion is spent on premiums.
    • Premiums fall into one of two categories: free premiums which only require the purchase of the product and self-liquidating premiums which require consumers to pay all, or some, of the price of the premium.
    • In-or On-package Premiums are usually small gifts, such as toys in cereal boxes.

  • Packaging Strategies

    • Toys are advertised in shops and on product packaging.
    • The educational benefits of toys are also explained on packaging for the benefit of parents and should be made explicit. .
    • It creates an image of the brand that can be the on-shelf purchase trigger or at-home touch point for consumers across a range of products and categories.
    • Color is just one cue that can give taste and fragrance perceptions – in chips, green says cheese and onion, while blue says salt and vinegar.
    • How can I offer them even more to justify the price/a premium?

  • Packaging Considerations

    • Andes mints are just one example of excessive packaging used to misrepresent the amount of product inherent in a package, making the package appear to have more product than it actually does.
    • Note, in this picture, the extra paperboard is added to exaggerate the size of the package.
    • Alternatively, development of a package (or component) can be a separate process, but must be linked closely with the product to be packaged.
    • Package design may take place within a company or with various degrees of external packaging engineering: independent contractors, consultants, vendor evaluations, independent laboratories, contract packagers, or total outsourcing.
    • Packaging plays an important part in preventing loss or damage to the packaged-product (contents).

  • Introduction to minimizing packaging

    • Packaging comes in many shapes and forms: boxes, bags, cans, foam pellets, shrink wrap, tubes, paper, etc.
    • Secondary packaging: larger cases, boxes, or bags used to group goods for distribution, ease of carrying, or display in shops.
    • The new package is more cube-shaped, which lowers packaging expenses by 10–20 cents per container.
    • Square jugs also store 50% more milk per square metre so more milk can be put on trucks, which reduces trips and fuel costs (by over 11,000 truck journeys annually).
    • Sam's Club (a division of Wal-Mart) says that the new jug also enables almost three times more milk to be placed in coolers.

  • Demanding a Premium

    • Firms can engage in premium pricing by keeping the price of their good artificially higher than the benchmark price.
    • Brands like Pepsi or Coke can price their goods at a premium, charging more than a generic soda brand due to its brand name.
    • Premium pricing is the practice of keeping the price of a product or service artificially high in order to encourage favorable perceptions among buyers, based solely on the price.
    • It is used to maximize profit in areas where customers are happy to pay more, where there are no substitutes for the product, where there are barriers to entering the market, or when the seller cannot save on costs by producing at a high volume.
    • Luxury has a psychological association with price premium pricing.

  • The "Bond Yield Plus Risk Premium" Approach

    • We can estimate the value of a company's equity by adding its risk premium to the yield to maturity on the company's long-term debt.
    • The risk premium on its equity is 4%.
    • BYPRP allows us to estimate the required return on an equity by adding the equity's risk premium to the yield to maturity on company's long-term debt.
    • The equity risk premium is essentially the return that stocks are expected to receive in excess of the risk-free interest rate.
    • In general, an equity's risk premium will be between 5% and 7%.

  • The Purposes of Packaging

    • The role of packaging in marketing has become quite significant as it is one of the ways companies can get consumers to notice products.
    • For example, in a typical supermarket a shopper passes about 600 items per minute, or one item every tenth of a second.
    • Considering the importance placed on the package, it is not surprising that a great deal of research is spent on motivational research, color testing, psychological manipulation, and so forth, in order to ascertain how the majority of consumers will react to a new package.
    • Information transmission: Packages and labels communicate how to use, transport, recycle, or dispose of the package or product.
    • Modified atmospheres or controlled atmospheres are also maintained in some food packages.

  • The Freemium Model

    • Freemium, a combination of the words "free" and "premium," is a business model where the company gives away a free service or software to all customers.
    • Freemium, a combination of the words "free" and "premium," is a business model where the company gives away a free service or software to all customers.
    • In fact, the concept of a smaller giveaway to attract a premium customer is not new.
    • History of the word FreemiumThe business model has probably been in use for software since the 1980s, particularly in the form of a free time- or feature-limited ('lite') version, often given away on a floppy disk or CD-ROM, to promote a paid-for full version.
    • Ways in which the product or service may be restricted in the free version include:

  • Packaging and Labeling

    • For example, in a typical supermarket a shopper passes about 600 items per minute, or one item every tenth of a second.
    • Considering the importance placed on the package, it is not surprising that a great deal of research is spent on motivational research, color testing, psychological manipulation, and so forth, in order to ascertain how the majority of consumers will react to a new package.
    • Information transmission: Packages and labels communicate how to use, transport, recycle, or dispose of the package or product.
    • Some packages contain desiccants or oxygen absorbency to help extend shelf life.
    • Modified atmospheres or controlled atmospheres are also maintained in some food packages.

  • Compensation and Competition

    • One of the key instruments in attracting and keeping employees is creating an effective compensation package.
    • Candidates often require a compensation package that includes benefits as a perk for employment, and may pass on a position with a higher salary if a competitor is offering a lower salary and a benefits package.
    • On one hand, a high base salary and a lucrative benefits package can help an organization keep and retain high-quality employees.
    • Employers think about the total compensation cost of employees and that calculation considers what they pay in health insurance premiums, in addition to salaries and wages.
    • Health insurance premiums are thus a cause of salary and wage growth stagnation for much of the population in the U.S.