What is trade promotion? | HCL Technologies

TECHNOLOGY Q&A

Consumer Packaged Goods (CPG) Sales Planning and Trade Promotion

What is trade promotion?

Consumer goods manufacturers face pressing trade investment requests from their retail partners to drive an increase of both revenues and margins. They must balance these requests with their own requirements to deliver revenue and volume growth along with higher margins and returns on investments.

Trade promotion is part of revenue management and refers to marketing campaigns directed at wholesalers or retailers rather than at final consumers. It is a marketing technique aimed at increasing demand for products in retail stores. In a trade promotion, wholesalers and/or retailers are offered special price discounts (often in addition to a trade allowance), subsidized or free display racks or stands, gifts, or other incentives.

Trade promotion management (TPM) is the process of planning and accounting for the funding of events and activities at retail level including brand management, budgeting, account management, demand planning, integrated sales and marketing, retail execution, and back-end processes (including settlement), and analytics.