How are trade promotions used by companies to achieve their marketing objectives?
What will be an ideal response?
• Increase distribution: Manufacturers can increase distribution by persuading the trade to carry their product
lines. Persuasion tools typically include trade allowances, payments, or discounts offered in return for the retailer's
agreement to feature the manufacturer's products. Manufacturers might also offer free cases of product to the
retailer to introduce the brand to the retailer.
• Increase trade support: To continue the support of trade members in the carrying of their brand, manufacturers
can periodically offer price -offs (discounts from list price) for a certain time period.
• Liquidate inventories: If the manufacturer plans to launch a new type of product, it might decide to eliminate
inventories of existing products using a variety of techniques, such as rebates.
• Increase goodwill: Manufacturers who wish to improve relations with distribution channel members can offer
goodwill gestures. Some approaches include offering free cases of product for trade members who buy a certain
quantity or who feature a certain flavor or size. Manufacturers can also offer sales contests, such as free trips to
top -selling channel members.
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