Promotional activities and strategies play a crucial role marketing channels. These activities consist of advertising, sales promotions, and personal selling efforts of firms engaged in the distribution channel. Much of an individual channel member’s promotional efforts are directed toward influencing the behavior of other firms within the channel. For example, a substantial portion of a manufacturer’s promotions may be aimed at encouraging wholesalers and retailers to participate in the manufacturer’s marketing efforts. Additionally considerable promotional effort consists of joint activities by all channels to stimulate consumer or end user purchase. The fundamental strategy decision of using a ‘push’ versus a ‘pull’ motion strategy is discussed in this article. Attention is then focused on advertising sales motions and personal selling of channel members as these efforts relate to channel strategy.
Push versus Pull Strategy:
There are two basic promotional strategy alternatives available to manufacturers. Most promotional activities within the distribution channel hinge upon these strategies choice. A pull strategy attempts to stimulate buyers’ or consumers’ demand for a product by promotional efforts aimed at the ultimate consumer or industrial user. The goal is to build demand at that level so that retailers, wholesalers, or distributors feel compelled to stock that product in their respective assortment. Ultimately, the product is ‘pulled’ through the distribution channel by the end user demand created. Advertising and consumer promotions are the most commonly used elements of a pull strategy.
By contrast, a push strategy focuses the manufacturer’s promotional efforts on the members of the distribution channel itself, rather than the final user, Trade advertising and allowances, trade promotions, and personal selling are designed to influence middlemen to stock the manufacturer’s products and promote them to the final consumer.
Very few manufacturers employ ‘pure’ pull or push strategies. An effective promotional effort generally makes use of both. For example, Procter & Gamble spend over $1 billion per year on advertising aimed at ultimate consumers in an attempt to generate consumer pull for its products. As part of its pull strategy P&G promotes continuously with coupons in newspaper and though direct mail. Nevertheless, P&G also employees thousands of sales representatives who all work on wholesalers and retailers to convince those channel members to stock and support P&G products. In addition to this personal selling effort, P&G employs extensive trade promotions and allowances tied to their consumer advertising for channel members who agree to support those products and program.
Advertising can of course be employed by any member of the distribution channel and may be directed toward end users or other distribution channel members. Of particular interest are trade advertising and cooperative advertising.
Trade Advertising is designed to communicate with members of the distribution channel. Most firms with products nationally advertised to consumer also depend upon trade papers and magazines to reach their channel members. Such publications as Chain Store Age and Supermarket News are frequently read by manufacturers, wholesalers, and retailers and provide excellent vehicles for promotion within the channel.
Trade advertising is more informative and detailed than consumers advertising. The appeals used are typically more rational than emotional. Manufacturers frequently employ such advertising to describe products, suggest methods for handling or presentation, or point out the advantage to wholesalers and retailers of stocking those products. It may also be employed to explain new marketing programs or to build goodwill with the trade. One example of a trade advertisement placed by Procter & Gamble is to explain its discounts for retailers. A sample is shown below:
Procter & Gamble
Notice to Our Customers
Attention: Store Manager owner
We offer annual funded marketing Agreements to all retailers in the USA. Payments are made for performance under the applicable plan: FMA plan—purchase, distribute, or reduce price; CMF plan – purchase and/or distribute cases for print/electronics media featuring and/or display and/or price reduction and/or in-store sampling/couponing and/or selling/consumer shows other programs involve distribution by agencies of product coupons and samples in stores, in various markets at various times. Also, we offer display material, newspaper proofs, etc., to assist you in merchandising our brands.
Details are set forth in specific agreements. These offers are practical and usable by all retailers regardless of size. You may now be performing under an agreement are being made to you or your headquarters or wholesalers on your behalf. In some instances, Wholesalers commingle these funds for the benefit of all their retail customers.
If you are not receiving benefit of these offers either or through your wholesale supplier and would like to do so, send your name, address and telephone number to Procter & Gamble Box 162 Cincinnati, Ohio 45201, and we will contact you. Please specify the company product line.
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