In the food industry, there is a 'golden rule' called 'no promotion, no sales.' As the name implies, if a product is not promoted, channels or terminals will not proactively stock it, let alone push it. At the same time, channel and terminal loyalty will decrease. Over time, market share will quickly be taken by competitors.
These phenomena force food companies to work hard on sales promotions to expand market share and boost sales performance. So, for the current year-end market, what convenient and easy-to-operate promotion methods are available? Today, we have listed eight efficient and feasible channel promotion methods for the year-end market, hoping to inspire industry peers and help you win the year-end FMCG market!
1. Buy Product, Get Product Free
'Buy product, get product free' is the most basic promotion method. Common forms include buying 100 get 5 free, buying 10 get 1 free, buying 8 get 1 free, etc. The specific quantity of free goods often depends on the product's sell-through rate; generally, the weaker the sell-through, the stronger the promotion.
However, this method is simple and can easily lead to price erosion. If terminal sell-through is slow, low-price dumping may occur, disrupting the product's price system and shortening its lifecycle.
But if the company has strong promotional support to ensure terminal distribution speed and strictly controls terminals, it can prevent the product from being 'promoted to death.'
2. Product Cross-Promotion
'Product cross-promotion' is one of the fastest-acting methods, typically pairing best-selling products with slow-moving or new products.
This method usually does not affect sales of best-sellers while ensuring that slow-moving or new products are easily accepted by terminal outlets, reducing the difficulty of distribution and increasing terminal acceptance of new or slow-moving products.
3. Product Portfolio Promotion
'Product portfolio promotion' is a method where terminal customers combine market demand with the company's sales objectives. For example, if the mainstream consumption specification is 500g, the company is relatively strong in this specification, and market demand is higher.
As the year-end sales peak approaches, the company wants to focus on promoting 1.25kg and 245g products to accelerate layout in the foodservice channel and year-end gift market. Therefore, it still allocates the majority of distribution to 500g products but increases the share of 1.25kg and 245g products to strengthen the foodservice and gifting channels.
Although the profit margin of the former is lower than the latter, the former can generate sales and attack competitors, while the company can accelerate the promotion of 1.25kg and 245g products, perfecting the year-end market layout.
4. Physical Gifts
In the year-end market, frequent product promotions can make terminals feel bored. Therefore, food companies can appropriately change promotion methods while ensuring channel profits, such as offering physical gifts.
For example, as shown in the image below, purchasing coconut juice can come with gifts like cups, laundry detergent, and other daily necessities, or shopping bags, tissues, etc.
In practice, these daily consumer goods are closely related to people's lives, so they are easy to monetize, and terminals are relatively more accepting. Using 'physical gifts' can add a finishing touch, drive sales further, and achieve better promotional results in the year-end market.
5. Cash Rebates
'Cash rebates' are the most attractive promotion method for terminals. For example, if a terminal purchases 5 cases at once, a direct cash rebate of 100 yuan can be applied to the current payment.
However, this promotion should not be used in combination with product portfolio promotions, as it may lead some terminals to lower retail prices, affecting future sales.
Promotions aim to further expand sales and ultimately maximize profits. 'Cash rebates' should only be used as an immediate competitive tactic, not frequently, as it may cause terminals to become bored with other promotion methods, setting obstacles for future promotions.
Because for terminals, only the fastest and most direct money-making methods are the most acceptable.
6. Product Display Rewards
To fully showcase product image and enhance customer purchase opportunities, competing for display space has become one of the key battlegrounds for food companies. In the year-end hot market, display space is given great importance.
This typically involves competing for prime shelf positions and more centralized display areas. For example, the display of Huanlejia canned fruit is very centralized, located in a prime area with suitable lighting, making it easy to attract consumer attention.
7. Seasonal Sales Incentives
Seasonal sales incentives are a common promotion method used by many food companies. This method aims to encourage distributors or key accounts to stock up during the off-season, helping manufacturers seize market share or sales volume and prevent competitors from taking advantage.
Food companies will provide additional off-season storage rewards on top of regular promotional policies. The magnitude of seasonal rewards depends on the season transition. In the year-end market, seasonal rewards for beverages tend to increase, while rewards for canned goods decrease. This is to stimulate distributors and key accounts to stock up more during the off-season, helping food companies with product turnover.
8. Merchandising Support
Many companies, to fully promote their brand, often provide terminals with storefront/signage production, in-store KT boards, POP, light boxes, posters, lanterns, price tags, and in-store/out-of-store stack displays. Especially during the year-end promotion period, vivid product displays can greatly attract consumers and give products a differentiated advantage over similar items.
The year-end FMCG market is a battleground for food companies, and year-end sales volume is at stake. Therefore, companies use every possible means to make a big push during the year-end peak season. As a result, competition methods and tactics are becoming more diversified, and competition is increasingly fierce. We hope that friends in the food industry can gain more insights and inspiration from this article, operate more smoothly in the year-end peak market, and win greater business opportunities!
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