Click 'Read Original' for details. "The industry often says, 'No promotion, no sales.' If a product is not promoted, channels or terminals will not proactively stock it; if not promoted, they will not push your product; if not promoted, their loyalty will decrease; if not promoted, market share will quickly be seized by competitors." These phenomena force companies to invest heavily in sales promotions to expand market share and grow sales performance. Below are 21 channel promotion methods seen in the market, shared for reference.
Buy More, Get More of the Same Product This is a basic promotion method, such as buy 100 get 5 free, or buy 10 get 1 free. The weaker the product's pull, the stronger the promotion. This type is typically used by manufacturers to push non-best-selling but key products, encouraging terminals to stock more. In practice, terminal order quantity often becomes a key performance indicator for product promotion. This method is simple but can easily lead to price erosion. If terminal sell-through is slow, low-price dumping may occur, disrupting the price system and shortening the product lifecycle. Prerequisites: strong promotional support to ensure terminal sell-through, strict control over terminals, and limiting quantities per outlet based on a promotion schedule to avoid killing the product.
Product Bundling Bundling usually pairs best-selling products with slow-moving or new products. The goal is to maintain best-seller sales while making it easier for terminals to accept slow-moving or new items, reducing distribution difficulty and encouraging terminal promotion. This works only if the best-selling product has high consumer pull and strong brand influence; otherwise, terminals won't accept slow-moving or new products, adding inventory or sales pressure.
Product Mix Promotion This combines market demand with corporate goals. For example, a beverage company's mainstream price points are 3, 4, and 5 yuan. The 3-yuan product is strong with high demand, but the company wants to upgrade price points and brand without hurting sales. They might set the 3-yuan item at 50% of distribution, 4-yuan at 5%, and 5-yuan at 20%. The 3-yuan item generates volume and competes, while 4- and 5-yuan products are the real focus.
Physical Gifts Frequent product promotions can bore terminals, so manufacturers sometimes switch to gifts. For example, buy 10 cases of new product and get a blanket; one-time purchase of 50 cases gets a phone; or cumulative sales reach a certain level and get a tricycle. In practice, gifts like rice and cooking oil are practical and easy to monetize, so terminals accept them well. However, terminals may factor gift value into price, lowering product prices.
Cash Rebates Cash rebates are the most attractive to terminals. For example, a one-time purchase of 5 cases gets a 100 yuan cash rebate. This should not be used on mixed-product promotions, as it may lead to lower retail prices and hurt future sales. Promotions aim to maximize sales and profits. Cash rebates should be used as a short-term tactic, not frequently, to avoid making other promotions seem less attractive and setting obstacles for future promotions.
Cash + Physical Rewards When a product isn't selling well, physical rewards alone may not excite terminals, and cash alone may seem like a price cut. Many companies combine both, often with a justification for the cash portion. For example, a one-time purchase of 20 cases at 40 yuan each gets 200 yuan for promotion staff wages or rent support, plus one case free, to stimulate terminal orders.
Box/Carton Recycling To boost sales, some manufacturers offer cash for empty boxes, encouraging terminals to push the product. This is especially useful when a product is popular but terminal margins are low, or during new product launches when profit margins aren't competitive. As the product gains consumer acceptance, the box recycling incentive is gradually reduced.
Display Rewards To showcase products and increase purchase opportunities, brands compete for display space. Terminals that follow manufacturer display requirements may receive monthly display rewards of 300-800 yuan (cash or goods, with cash preferred). Random checks may disqualify non-compliant terminals. Some manufacturers link display rewards to sales, setting dual targets. For example, a base display fee of 300 yuan/month, plus an extra 200 yuan if sales targets are met, with higher rewards for higher targets. Some companies include display fees in sales policies during new product launches to ease distribution and display challenges.
Merchandising Support For brand promotion and information delivery, manufacturers may fund terminal signage, in-store KT boards, POP, light boxes, posters, lanterns, price tags, and stack displays, either annually or periodically, rewarding terminals that meet standards.
Dedicated Promoters Manufacturers place dedicated promoters in terminals to directly promote and introduce products to target consumers. Key is training on product selling points, brand messaging, and sales skills.
Support for Key Accounts For large-volume terminals, manufacturers may provide support such as promotion staff, rent, utilities, and wages, based on sales targets and performance, to boost enthusiasm and cooperation.
Volume-Based Rewards Since terminal sales capabilities vary, manufacturers offer tiered rewards for meeting volume targets, plus fuzzy rewards for overachievement, to motivate top performers and encourage others. This is often used by strong regional brands.
Cumulative Sales Rewards To maintain sales momentum and ease one-time purchase pressure, manufacturers set cumulative sales targets over a period. Reaching a threshold earns points or equivalent product rewards, with higher thresholds offering better rewards.
Task Completion Rewards This is a price subsidy for completing sales tasks within a specified time. Terms are agreed in advance: sales period, quantity, and reward levels. The better the completion, the higher the reward.
Sales Ranking Rewards Two forms: periodic sales contests and annual rankings. For example, monthly top three get a smartphone, washing machine, or microwave. Annual top performers may receive luxury travel, appliances, or cash, and top contributors might get a delivery vehicle for their use (manufacturer retains ownership). This "horse race" approach turns sales into a prestige battle, but manufacturers must manage top clients to prevent them from becoming too demanding.
Rebate Combinations To control clients and prevent risks like cross-region selling, manufacturers use a mix of explicit rebates, hidden rebates, process rebates, category sales rebates, and overall volume rebates. Explicit rebates have clear standards; hidden rebates are vague on amounts but clear on requirements. Process rebates reward specific actions like distribution rate, market share, inventory levels, payment speed, price compliance, and cooperation with promotions. Category rebates encourage pushing specific product categories. When paying rebates, manufacturers prefer goods over cash, such as daily necessities, travel, computers, vehicles, or training.
Seasonal Rewards To encourage distributors to stock up in off-seasons, manufacturers offer extra incentives beyond normal promotions. Rewards are higher in off-season and decrease as peak season approaches, motivating early stocking.
Payment Speed Rewards For large accounts that may delay payments, manufacturers offer rewards for quick payment. For example, 3% rebate for payment within 10 days; after 10 days, interest is charged. In appliances, manufacturers often offer high rewards and interest above bank rates for early prepayment.
Payment Terms Rewards This includes deferred payment, installment payments, or payment on next order. Manufacturers extend credit to ease cash flow for merchants, attracting more distributors and large clients.
Customer Title Rewards For strong, high-volume distributors, manufacturers offer both material and honorary rewards, such as "Sales Champion of the Year" or "Market Pioneer of the Year." This recognition boosts loyalty and stimulates others through competition.
Platform Upgrade Rewards Manufacturers may offer equity to deepen cooperation, turning clients into alliance partners, or upgrade second-tier distributors to regional distributors, or expand small regional distributors to cross-regional roles.
From August 22-24, the China FMCG Industry Association, organized by New Distribution, will hold the "2018 China Digital Innovation Conference (2018FDIC)" in Shanghai, themed "Finding New Growth Engines." The 3-day event will focus on marketing and supply chain, with six parallel forums on brand, distribution, communication, B2B, local logistics, and innovative retail. Industry leaders, CEOs, and brand executives will discuss digital transformation trends and drivers. We will invite over 500 FMCG executives, 200+ B2B CEOs, and 1000+ major FMCG distributors to discuss how to use digital tools for renewed growth. The conference will bridge brands, distributors, retailers, and marketing agencies, providing insights and best practices.
Invited Companies (list omitted)
Conference Time: August 22-24, 2018 Venue: Shanghai Baohua Marriott Hotel Agenda:
- Aug 22: All-day check-in; 14:00-17:30 Distributor Local Logistics Forum; 18:30-21:00 New Distribution Night Gala Dinner
- Aug 23: Theme: Marketing Digital Innovation; 9:00-12:00 Main Forum; 14:00-17:30 Parallel Forums on Brand, Distribution, Communication
- Aug 24: Theme: FMCG Supply Chain Digital Upgrade; All-day Supply Chain Conference
Registration: Open now. Scan QR code or click 'Read Original' to register. Early bird tickets at half price, only 50 left, while supplies last. For inquiries: Ticket and media cooperation contacts (omitted).
Review previous conferences via links below. -END-