Trade marketing is a branch of marketing aimed at promoting merchandise at a wholesaler, retailer or a distributor level. The basic idea is to market your products through the value chain, including Points of Sale. Here are 4 distinctive features of trade marketing, and how you can work with it:
Promote your products to a retailer
To ensure prominent display of products, including more shelf space, a constant promotion is needed. There are multiple ways of doing it: one, for example, is by paying different bonuses to a retailer or a wholesaler as part of the contract. Usually it is done once a month or a quarter.
The second one, which is more basic and is being done constantly by most distributors, is different promo aimed at the whole sales channel. Such promo can have different goals and utilize different mechanics, but the main goal is simply sales increase.
POSm, or Point of sales materials, are an integral part of any trade marketing strategy. Those can vary, for example, a flyer with a promotion mechanic for an outlet can also be considered POSm. Also this group includes promo materials usually displayed inside a point of sale, such as shelf talkers, shelf stoppers, yellow/red price tag, lightboxes and so on. Here is an example:
Transition to end consumer
Many of trade marketing activities involve transition to end consumer, or should initially be directed to that purpose. The basic examples are sales at retail chains or gift-for-purchase type of promo.
Such promo activities can also be performed in basic retail stores, with mechanics such as when distributor gives a discount for individual products, and a retailer translates a discount on the final price of the product. POSm usually play a big part in such promo activities.
Trade marketing today
Nowadays a huge chunk of trade marketing involves digital part, sometimes even utilizing Big Data. For example, a product can have a code to promote a digital add-on, or it can give a customer added privileges for e-commerce activities, including a discount in such cases as using an app to buy a product, instead of going to the store. Or a retail chain can utilize e-mail newsletter to inform customers of new discounts. This way trade marketing blends with digital marketing.
Check out the very true trade marketing promo mechanics on our portfolio page.