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When launching a new product, distributors need to manage distribution and promotion, which requires mastering every link in the channel: sub-distributors, retail terminals, supermarkets, and competing products. Based on the characteristics of each link, distributors can design different promotional methods to achieve the ideal market coverage. Reasonable and effective promotions can activate the new product's features in the shortest time and rapidly increase its market share among similar products; conversely, they may lead to a passive situation of channel stagnation. To this end, our reporter interviewed several distributors, who shared their views and methods on new product promotions based on their respective channel expertise.
【Case 1】 Distribution Channel: “Tiered Promotion” Boosts New Product Distribution — Mr. Li, Ding Sheng Trading Company, Hangzhou, Zhejiang
Our company recently launched Product A. Due to its large profit margin, we adopted a “tiered promotion” strategy. The promotion was set in three stages, ultimately successfully launching Product A and achieving a high distribution rate. This method is suitable for distributors and large supermarket clients with relatively ample funds.
Tier 1: We set tiers at 100, 200, and 400 cases, with rewards of 0.7 yuan/case, 1 yuan/case, and 1.5 yuan/case respectively. The first stage set lower thresholds but higher reward rates, mainly considering small clients with limited funds. This stage lasted one week.
Tier 2: Tiers were set at 400, 600, and 800 cases, with rewards of 1 yuan/case, 1.5 yuan/case, and 2 yuan/case respectively. At this stage, the new product had received a positive response in urban areas and was gradually radiating to outer regions. Considering the interests of large and medium clients, we raised the tiers. For small clients, they needed to focus on selling Product A, even abandoning other brands, to reach the rebate standard.
Due to the success of the first stage and the product's advantages, sales of Product A gradually increased. At this time, large and medium clients with ample funds began to stockpile, which could affect price stability. To address this, the company issued a price list for sub-distributors at all levels, clearly stating that any violation of pricing policy would result in immediate suspension of supply. This stabilized the market price and alleviated concerns among sub-distributors about price instability. This stage lasted two weeks.
Tier 3: With the smooth progress of the first two stages, Product A achieved effective distribution and rapid sales growth. At this point, the company organized a regional sales competition, evaluating performance by region, with entry qualifications and reward amounts. The lure of high bonuses greatly motivated clients, leading them to stockpile large quantities, maximizing the use of their inventory and funds. This stage lasted one month.
Comment: “Tiered promotion” can quickly improve distribution rates and boost sales. However, it is a double-edged sword. If the product sells well in the market, large and medium clients may stockpile to earn higher rebates, disrupting market prices and affecting price stability.
Therefore, after launching a tiered promotion, it is essential to clearly define the minimum selling price for sub-distributors at all levels, and any violation should result in immediate supply suspension. However, price control may have a deterrent effect on clients of leading brands, but it may not be effective for small brands. Thus, the effectiveness of price control is crucial to the success of the promotion. Moreover, tiered promotions require strong support from manufacturers, so distributors should act according to their capabilities.
[Case 2] Retail Channel: “You Display, I Gift” Enhances Terminal Display — Mr. Zhou, Heng Da Food Co., Ltd., Ningbo, Zhejiang
When launching a new product, it is necessary to increase its visibility at retail terminals to attract consumers' attention, which requires expanding the product's display space. When promoting new beverage Product B, the company implemented a series of measures to boost visibility, with the guiding principle of “set a quota, offer gifts.”
The company set reward conditions: for orders exceeding 200 cases, for every 2 bottles displayed on the shelf, one bottle of the same product was given as a gift. This measure was immediately recognized by retail terminals, and the display effect was obvious. The distribution rate of Product B greatly improved. The “set a quota, offer gifts” activity lasted over a month, achieving effective exposure of Product B at terminals and increasing sales.
Comment: For impulse-purchase products like beverages, consumers go to the nearest retail terminal when they have a need. Which product they buy depends entirely on the limited products they see at the terminal. Even if they intend to buy a specific similar product, if the terminal does not have it, they will quickly find a substitute—the most visible and abundant product on the shelf.
Therefore, Mr. Zhou's method of “gifts for display” effectively increased the display space, visibility, and distribution rate of the product at terminals, playing a crucial role in promoting impulse-purchase products like beverages.
[Case 3] Supermarket Channel: “Popularity Promotion” Creates a Hot Sales Atmosphere — Mr. Wang, Hong Yun Food Co., Ltd., Hangzhou, Zhejiang
Our company previously conducted a promotional campaign for Product C, a beverage, by holding new product events in large shopping malls or supermarkets. Through games, Q&A sessions, roadshows, and other activities, we created an atmosphere to gather crowds, thereby enhancing the product's visibility and expanding its consumer base.
The company held a supermarket promotion themed “I'm the Coolest in Midsummer.” The event's theme board was 4m×3m, standing 5m high, featuring waves, coconut trees, and product images, giving a refreshing feel and standing out among many promotions. Combined with advertising materials and recorded broadcasts played over speakers, it created a lively promotional atmosphere.
Simultaneously, on-site Q&A and treasure hunt games were held. To participate in the treasure hunt, attendees needed a “game ticket,” obtained by purchasing any two bottles of Product C and presenting the receipt. Participants received small gifts, attracting consumers to engage in on-site interactions. Roadshows and tasting activities were also in full swing, drawing more and more consumers, and the gathered crowd created a spectacular promotional scene for Product C.
Comment: Mr. Wang's promotion was highly innovative, using the theme “I'm the Coolest in Midsummer” for differentiated promotion, unlike traditional supermarket promotions that typically involve a promotional table, one or two promotional girls, posters, competitive prices, or attractive gifts.
Such promotional activities maximize the creation of a hot sales scene, and the continuous gathering of consumers enhances product visibility, serving to promote the new product. However, this type of promotion has a clear disadvantage: it requires high distributor capability, high-quality event venues, and strong support and cooperation from the manufacturer.
[Case 4] Competitor Promotion: “Exclusivity Agreement” Achieves Terminal Interception — Mr. Liu, Lan Jian Food Co., Ltd., Jinhua, Zhejiang
When launching a new product, similar competing products may also appear. To achieve sales of the new product and reduce or even eliminate the impact of competitors, the company signs “exclusivity agreements” with retail terminals. Terminals that enjoy various financial support from our company cannot sell similar competing products.
For example, when promoting Brand A children's milk, the company signed agreements with clients that they could not sell Brand B children's milk. In return, the company provided promotional gifts, umbrella stands, price discounts, and other financial support to help terminals move the product.
The company periodically visits outlets to inspect shelves. If competing products are found, sales staff are required to remove them. Terminals not only cannot sell competing products but also cannot display related promotional materials like door headers or posters. The company tracks outlets through sales staff to check execution, ensuring that even the “shadow” of competing products is invisible, creating a dedicated store for Brand A children's milk.
Comment: “Exclusivity agreements” help improve the distribution rate and sales of new products. Under the agreement, a product is sold by only one terminal in a certain area, so the outlet's profit and product sales depend to some extent on its sales performance of the product.
In this situation, outlet clients will strive to conduct market research and take various proactive measures to boost sales, such as running promotions, urging sales staff to ensure distribution, display, replenishment, and ordering. As a result, not only do outlet clients increase their revenue, but the new product also gains rapid promotion.
Mastering channel promotions is key to new product promotion, and every link must not be underestimated. Through the channel promotion cases shared by these distributor bosses, it is evident that tailored promotional designs for each link yield different effects and benefits.
Distribution channel promotions bring rapid improvement in distribution rates; retail terminal promotions enhance product visibility and expand display space; supermarket channel promotions create a hot atmosphere, allowing consumers to face the product, try it, and increase awareness and consumer base; promotions targeting competitors expand the product's sales scope and also motivate retail terminals.
If distributors can grasp the promotions in these key channel links and design reasonable and effective promotional forms, they will surely push the new product higher, farther, and faster.
Text/Sugar Tobacco Wine Weekly -------------------------------------- Like this article? Feel free to click the top right corner to share to your Moments; About us: WeChat ID: FMCG Distributor Professional Consulting Management Account Intro: 20 years of FMCG distributor operation and management experience, professionally targeting distributor internal management: Click the “Read Original” below to enter our micro-community for interactive communication and questions. Learning Exchange QQ Group: 344257092 Reply 1 to enter the micro-official website to view historical messages. -----------------------------------------