Explain the difference between a push and pull strategy.

Question

What will be an ideal response?

Answer 1

A push strategy means that much of the intensive promotional activities take place from the manufacturer downward through the channel of distribution. Think of this approach as an investment by the manufacturer in intermediaries so that they will have a maximal incentive to stock, promote, sell, and ship the firm's products. Push strategies usually are supported by heavy allowance payments to intermediaries for helping accomplish the manufacturer's goals.

In contrast, a manufacturer employing a pull strategy focuses much of its promotional investment on the end-user consumer. In this case, heavy advertising in mass media, direct marketing, couponing, and other direct-to-consumer promotion are expected to create demand from intermediaries from the bottom of the channel upward. A pull strategy doesn't mean a manufacturer wouldn't engage in any channel incentives, but rather that the incentives would likely be greatly reduced versus a push strategy.