Trade marketing is the key to getting your product noticed and purchased by consumers. It involves promoting and positioning your product in various shops, big or small, worldwide.
This guide explains what trade marketing is, discusses its strategies, and recommends the top five advertising agencies guaranteeing successful results for your business.
Table of Contents
- What Is Trade Marketing?
- Who Uses Trade Marketing?
- Why Is Trade Marketing Important?
- Trade Marketing Strategies
- How To Develop a Trade Marketing Strategy
- Top 5 Advertising Agencies To Help You Build a Trade Marketing Strategy
- Trade Marketing Examples
- Trade Marketing Tips
- What Is Trade Marketing? Key Takeaways
- Trade Marketing FAQ
What Is Trade Marketing?
Trade marketing is a marketing discipline that aims to boost demand for your products through supply chain partners—distributors, wholesalers, and retailers. It focuses on activities and techniques that help increase product visibility, availability, and sales.
Who Uses Trade Marketing?
Any business involved in a supply chain can use trade marketing. The process typically includes the following stages:
- A company manufactures consumer packaged goods (CPG) and dispatches them to a distributor at lower prices than the competition. The manufacturer offers additional benefits, such as discounts, bonuses, or other incentives, to ensure the distributor extensively promotes their products.
- The distributor sells the products to selected wholesalers.
- The wholesalers sell the goods to retailers.
- The retailers advertise the product to end consumers through more shelf space, prominent displays, or branded merchandise.
- This process ensures availability and a consistent supply from the manufacturer to the end consumer.
Why Is Trade Marketing Important?
- Builds Relationships
- Provides A Competitive Advantage
- Increases Your Market Presence
- Boosts Profitability
Trade marketing drives the following advantages:
Trade marketing helps you build long-lasting relationships with supply chain partners. This in turn can lead to easy distribution, increased profits and constructive feedback on possible product improvements.
Provides A Competitive Advantage
Trade marketing helps ensure your products are presented over the products of the competition, by offering the sellers attractive margins.
Increases Your Market Presence
Trade marketing helps you increase your market presence by making your products accessible to customers who prefer shopping in retail and local shops, rather than shopping online.
Customers who prefer to shop in physical stores are more likely to trust the retailer from which they have purchased goods in the past, so they are likely to show interest in your product if the retailer recommends it.
Trade marketing helps you sell your goods even if you don’t have enough knowledge about your end customers, by partnering with distributors, retailers and wholesalers who have more extensive knowledge about your target market.
Trade Marketing Strategies
The most common types of trade marketing strategies that bring results include:
Branding allows you to communicate your unique value proposition and the benefits of your product, raise awareness about the products you offer, establish an emotional connection with your customers and make wholesalers, distributors and retailers more willing to present and promote your goods.
Trade promotions allow you to increase your market placement and generate sales by giving wholesalers and retailers good margins to promote your products.
Based on price reductions, coupons, bulk deals, incentives and bonuses, trade promotions are beneficial for both your consumers and trade marketing partners.
Trade shows, also known as exhibitions or trade fairs, allow you to meet customers and promote your products. They also allow you to network with distributors, wholesalers and retailers who can become your trade marketing partners.
Strategic partnerships with well-known brands allow you to benefit from their popularity and credibility, along with their data and insights, to raise awareness about your products, build trust and boost sales.
Advertising allows you to target either mass audiences or specific audiences and boost brand awareness. Advertising helps create desire for your products, which leads the consumer to shop in the retail store to find them.
On the other hand, when consumers show interest in a product their favorite retailer does not offer, the retailer is likely to contact other levels within the supply chain to make the product available.
Making customers aware of your product facilitates the work of distributors, wholesalers and retailers.
How To Develop a Trade Marketing Strategy
- Conduct Market Research
- Study The Current Market Trends
- Design And Develop Your Product
- Build Brand Awareness
- Establish Your Product Proposition & Monitoring System
- Create An Advertising Plan
To develop a successful trade marketing strategy:
Conduct Market Research
- Study the pain points, needs and expectations of your target audience
- Research your competitors and the methods they use to sell their product(s)
Study The Current Market Trends
- Research the current B2B marketing trends to come up with trade marketing initiatives that will work for you
- Find opportunities you can use to your benefit, such as product price, added value for the customer or new solution to an existing problem
Design And Develop Your Product
- Design your product in line with consumer demands to make it stand out as a preferred choice on the market
- Use innovation to make it desirable for consumers
- Decide attractive packaging options
- Brand your product
Build Brand Awareness
- Build a website that reflects your brand
- Create marketing and advertising materials to promote your brand
Establish Your Product Proposition & Monitoring System
- Prepare an offer for distributors, wholesalers and retailers
- Identify and implement systems to monitor and manage simultaneous promotions at multiple retailers
- Integrate a system, together with your supply chain partners, to supervise inventory movement within the supply chain
Create An Advertising Plan
- Consider the types of ads and advertising channels you want to use to promote your product
- Work with a professional advertising agency to establish a thorough plan with weekly and monthly initiatives
From market research of competitors and trends to branding and advertising, a trade marketing strategy, guided by the expertise of a market research company, will help you reach your target audiences and successfully promote your product.
Top 5 Advertising Agencies To Help You Build a Trade Marketing Strategy
Working with an advertising agency with a proven track record can help you build one of the best brand awareness strategies to ensure your products reach your target market.
An agency can also support your direct response marketing efforts to evoke an immediate response from your target groups and encourage them to search for your product.
Here’s our roundup of the top five advertising agencies that can help you drive measurable results.
1. AXIS visual
Headquartered in Doylestown, Pennsylvania, Axis visual combines creativity with extensive knowledge or business and production processes to promote your brand.
AXIS visual offers:
- Advertising agency services
- Logo design
- Product design
Some of Axis visual’s well-known clients include United Incentives, Compass One, Acurian and Crothall.
Headquartered in Wroclaw, Poland, LaSoft specializes in building innovative applications to help startups raise awareness about their products.
- Mobile app development
- Digital marketing
- Product design
- Web design
LaSoft’s notable clients include TheSpoke, Casadesk, Servant and SapientBot.
Headquartered in Omaha, Nebraska, Identity Marketing Group designs solutions and products for companies of any size.
Identity Marketing Group offers:
- Video production
- Advertising agency services
- Digital marketing
- Print design
Identity Marketing Group has partnered with brands such as MasterCard, Drake Williams Steel, Miller Electric and VISA.
Headquartered in Bel Air, Maryland, Black Propeller manages over $100 million per year in ad spend across various paid search channels.
Black Propeller offers:
- Digital advertising
- Digital marketing
- Video marketing
- Social media marketing
Black Propeller’s notable clients include Optex, Fast Pace Health, Next day Floors and Valet Living.
Headquartered in Boston, Massachusetts, KHJ specializes in consumer brand marketing and business-to-business strategies.
- Advertising agency services
- Digital marketing
- Video production
- 360° Digital agency services
KHJ’s well-known clients include Quest Diagnostics, MassGaming, Abbott Molecular and Nordblom.
Trade Marketing Examples
The most common trade marketing examples include the following:
Manufacturers and wholesalers use different strategies to increase sales through retailers and distributors. These strategies, known as trade promotions, come in four main types:
- Price reduction or buy-one-get-one discounts and coupons
- Branding outside shelves using posters, displays, or special items to draw attention to the product away from the shelves.
- Motivating sales representatives with incentives or competitions to achieve higher sales.
- Providing samples or demonstrations at a location where customers can try the product.
Common trade promotions include coupons, discounts, special pricing, free samples, gifts, free-of-cost service, or volume-based incentives to retailers or wholesalers to encourage them to stock and promote the product.
Example: “Buy one, get one free” tactic, offered by many famous brands like Subway, Bath & Body Works, Starbucks, and Victoria’s Secret. BOGO trade promotion strategy helps increase sales volume, incentivizes retailers to stock and promote the product, and attracts customers with the perceived value and savings of the promotion.
Trade Shows, Fairs, and Exhibitions
Participating in industry-specific trade shows, fairs, and exhibitions is important for manufacturers. These events enable them to showcase products directly to retailers, wholesalers, and distributors and establish partnerships with important suppliers. These events also provide networking opportunities and help build long-term relationships.
Example: "Consumer Electronics Show" (CES) is held annually in Las Vegas. This event gathers consumer electronics manufacturers from all over the world. Manufacturers showcase and promote their latest innovations, connect with industry experts, and establish partnerships with retailers and distributors.
A website allows manufacturers to showcase their products and attract a large audience. A well-designed website with high-quality content can effectively capture the customer's attention.
A website should include branded marketing materials for advertising and promotional purposes, which can benefit supply chain partners. They can access and use these materials to promote the products to their customers, enhancing the overall marketing efforts and increasing sales within the distribution channel.
Example: Amazon Business is an B2B online platform designed for businesses to buy and sell products. Businesses can find various items and take advantage of features like bulk purchasing, business pricing, and specialized catalogs.
Branding involves creating a distinct identity for a manufacturer's product. It influences consumer preferences and builds trust. It differentiates products and creates a positive perception among retailers and consumers. By investing in branding, manufacturers can increase the desirability of their products and gain a competitive advantage in the market.
Example: Prominent brands like Microsoft, Apple, and Google are excellent examples of effective branding strategies. They aren’t recognized solely by their product names but have established a strong reputation and recognition in the market. Retailers prefer offering products from well-known and reputable brands rather than unfamiliar companies.
When brands collaborate through marketing agreements or campaigns to help each other achieve their goals they are in strategic partnership. A primary brand with products or services complements a secondary brand and both benefit from targeting the same audience to enhance their value proposition. Rather than simply buying and selling products or services, strategic partnerships involve a closer relationship where both parties participate in promotional activities like marketing, advertising, branding, and business development.
Example: Coca-Cola has a long-standing strategic partnership with McDonald's (since 1955). Coca-Cola is the exclusive beverage provider for McDonald's restaurants, and their collaboration includes joint marketing campaigns, co-branded promotions, and special menu offerings.
Trade Marketing Tips
Now that you know how to build a trade marketing strategy, here are some top tips from our experts, to help make your strategy a success!
- Create a promotion schedule around specific themes, such as annual festivals and holidays, like Christmas and New Year’s
- Organize cross promotions of your brand
- Maintain consistent messaging across all marketing channels
- Present your products to consumers by comparing them to your competitors, showcasing the benefits they can bring in terms of price, quality, niche, etc.
- Plan well in advance to properly distribute resources and time
- Use your promotions to both boost sales and grow your brand
- Pay to retailers on scan, meaning reimburse them for what shoppers have purchased rather than paying huge amounts in advance
Set goals for your trade promotions and analyze the results, taking into account all costs, such as retailer fees, discounts or fixed costs
What Is Trade Marketing? Key Takeaways
Trade marketing allows you to present your products through supply chain partners, such as distributors, wholesalers and retailers, to increase your reach and build credibility.
Using trade marketing:
- Builds relationships
- Provides a competitive advantage
- Increases your market presence
- Boosts profitability
Trade marketing strategies include:
- Trade promotions
- Trade shows
- Strategic partnerships
To build a trade marketing strategy:
- Conduct market research
- Study the current market trends
- Design and develop your product
- Build brand awareness
- Create your product proposition
- Create an advertising plan
To start your trade marketing strategy, contact a full-service advertising agency to help you plan and implement trade marketing for your brand.
Professional advertising companies can help you in that regard by providing their expert opinion on the matter and guiding your business as fits your market.
Trade Marketing FAQ
1. What is trade marketing vs. brand marketing?
Trade marketing targets distribution channels to convince retailers and wholesalers to stock and promote a specific product. It involves negotiating trade deals, providing incentives, and developing point-of-sale materials to attract retailers' attention, encourage them to include the product in their offer and promote it to maximize its visibility and availability in the retail space.
Brand marketing focuses on building and enhancing the brand image and reputation among consumers. It involves creating a strong brand identity, developing compelling advertising campaigns, and engaging with consumers through various marketing channels. The objective is to establish a positive perception of the brand, gain customer loyalty, and drive consumer demand.
In simple terms, trade marketing is about persuading retailers to stock and promote the product, while brand marketing is about building a positive brand image and connecting with consumers to generate demand for the product. Both approaches are important and often work together to achieve overall marketing objectives.