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How can the cosmetic industry benefit from providing incentives to their trade partners?

  • December 9, 2019

All marketing promotional strategies have one goal: “Drive consumer demand’’. Although some marketers see trade promotion vs. consumer promotion as an “either or” situation, forgetting that trade partners are conduits for moving product from suppliers to consumers. The most effective promotions address both trade and consumer priorities. In short, unless a trade sales promotion is designed with the customer in mind, it’s likely to do little more than get products into stock rooms and warehouses, where they don’t make anyone any money that’s why; they offer trade partners (i.e., store owners) additional incentives to get their help in driving consumer demand.

Thus, marketing strategies are commonly discussed in terms of “push” and “pull” marketing strategies, taking into account both the trade partners and consumers. An incentive is a reward intended to induce, incite, or spur action. Economic developers aim to improve the economic and social well-being of their communities by increasing private-sector investment and
employment.

Trade promotion strategies are push strategies.

Their purpose is to push products out of warehouses to retail points of purchase where consumers shop.. They pull shoppers into retail stores or pull in-store shoppers to promotional display units with short-term incentives to buy now. Different push strategies address different trade promotion objectives, though most push strategies are price-related.

Push money, also referred to as a trade allowance, essentially pays trade partners to promote certain products. This money might include such incentives as bonuses for writing more retail orders, extra payments for building in-store displays or additional money for advertising. Example, beauty retailer Sephora, who has seen much success with their  ‘Beauty Insider Programme’, offers free makeup classes and access to exclusive beauty events to keep their customer base engaged. Benefits like these are putting a new spin on customer loyalty