What Is Trade Marketing?

Introduction to Trade Marketing

Although sometimes confused with strategic Sales planning, Trade Marketing is actually a marketing discipline that relates to increasing demand with supply chain partners, such as distributors, wholesalers and retailers, rather than at the consumer level. It is not a replacement for Brand Marketing, but a complementary process by which you enable consumer access to your brands through distribution. In short, Trade Marketing is the process by which you ensure available supply to meet the consumer demand created by your Brand Marketing. Following is a very high level overview of the general principles and components of Trade Marketing.

Wholesale Customer Types

Supply Chain customers include both wholesale and retail entities and, generally, a two to three tier structure. Wholesale entities generally include various types of distributors, distribution centers and sub-distributors. Depending on the number of levels within the supply chain, these wholesale entities may be direct-buying (i.e. purchasing direct from the manufacturers) or indirect-buying (i.e. purchasing from other supply chain distributors). The primary advantage in dealing with wholesale partners lies in their ability to efficiently deliver a variety of products, from many manufacturers, in small quantities to many different retail outlets.


Retail Customer Types

The Retail universe is made up of a wide variety of retail outlet types and is often categorized by type of ownership into controlled, or corporately owned groups, and independently owned retailers. In some case, the controlled retail universe may represent more than one level in the supply chain with hybrid wholesale-retail entities such as chain, or controlled, distribution centers or buying groups. A good example of a large controlled retailer in this category would be Wal-Mart. With thousands of stores and dozens of distribution centers, Wal-Mart operates under disciplined corporate control and represents at least two levels of the supply chain.


Outlet or Trade Channel Types

While Trade Channels and Outlet Types are somewhat distinct in sophisticated Trade Marketing models, they are often used interchangeably in simpler models. In a simpler model, both are used to categorize supply chain entities, both wholesale and retail, into similar groups that can be engaged with common, or similarly structured, programs. A short listing of Trade Channels in a standard CPG supply chain might include the following.

  • Convenience
  • Dollar
  • Drug
  • Grocery/Supermarket
  • Hardware/Home Improvement
  • Mass Merchandiser
  • Wholesale Club
  • Other

Components of Trade Marketing

Trade Marketing components can be categorized into three distinct groups based on the type of activity performed and the type of company role that performs it. These categories may vary by company but one model that is employed throughout the world includes separation in to Strategic, Operational and Executional groups. Examples of various components of each of these groups are listed below.

Strategic Components

  • Trade Strategy
  • Customer Census & Classification
  • Trade Analytics

Operational Components

  • Trade Program Development
  • Sales & Operational Planning
  • Category Management
  • Trade Coverage Planning
  • Trade Investment Modeling

Executional Components

  • Account Management
  • Territory Management
  • Trade Approach Contacts
  • Customer Call Processes
  • Trade Events & Relations

10 Step Guide to Local Marketing

The difference between local businesses that succeed and those that fail isn’t always about the money they spend. Often it’s just about having a well thought out plan on how to take advantage of local resources to raise your profile and grow your customer base. Following is our ten step checklist to help you get your business started down the right path to local marketing success.

10 Step Local Marketing Checklist

1) On-Site SEO – The most important aspect of local marketing for any business is a strong website presence. Take the time to complete a comprehensive review of your website and optimize it for local Search Engine success. This is one aspect of your local marketing you MUST do correctly.

2) Off-Site SEO – Once your website is optimized it’s time to raise your profile on the rest of the internet as well. Do some research to identify the best local and regional resources, both paid and free, for you to partner with and improve your off-site profile. Don’t forget to take advantage of Google, Bing and Yahoo local resources.

3) Search Engine Marketing – Search, text and display ads can be extremely cost-effective with a campaign that’s properly purchased and targeted. Imagine the power of showing up on virtually every relevant search of Google and Bing in your local market.

4) Social Media Marketing – While social media fits some business types better than others, it’s absolutely essential to have at least a modest presence on key social media sites for virtually all businesses. While it may not require a large investment it’s simply too important to ignore.

5) Digital Display Ads – Often you have excellent online options to advertise on locally that the big search engines don’t offer. With a little research, you may find that local businesses and directories in your field can be an inexpensive way to make a big online splash.

6) Direct Mail & Email – Done properly, mail and email campaigns can be a great way to interact directly with the people you want to do business with. If you have a list, use it. If you don’t have a list, build it.

7) Focused Print – While large scale print options may not be possible, there are always local options to consider including anything from newspaper to locally produced publications in your field. Even in an increasingly digital world, print remains a cost-effective way to reach consumers.

8) Precision Mass Media – Depending on the size of your budget, TV and Radio may be very good options for growing your brand profile within your home geography. An effective mass media campaign can do wonders for your business if properly targeted and presented.

9) Out of Home (OOH) – When possible, a locally targeted OOH advertising campaign can be an efficient use of marketing budget through a variety of local media vehicles ranging from billboards all the way down to flyers.

10) Trade & Consumer Events – Depending on the nature of your business, either trade events, consumer events or both may be excellent vehicles for growing your business. There’s simply no substitute for face to face interaction with potential customers.

Build a Marketing Plan and Stick to It

Remember, the best plan in the world won’t do you much good if you implement it poorly. Pick a plan you can afford and one that allows you to keep it going. Even a modest plan that you can maintain gives you a much higher possibility for success than a big plan that doesn’t last.

Four Rules for Effective Advertising

While types of advertising will vary, there are very few companies or brands for which advertising is not a staple. Whether you’re launching a new brand or repositioning an old one, there is really no better or faster way to communicate the value proposition of your product or service to the masses.

With that said, advertising isn’t as easy as just spending some money and watching your business grow. As a matter of fact, studies have consistently shown that there is no direct correlation between the dollars you invest and the results you achieve. While spending more is generally better than spending less, success is dependent more on the quality of your advertising than the quantity.


Quality Beats Quantity

Sounds easy, doesn’t it? Only do quality advertising. The difficult part is that not many people are good at building quality ads. Those that are good at it have spent years in the business learning how to build effective ads and have paid the price learning it. Here are a few quick rules you can follow to make sure you get started down the right path.

Rule # 1: Find someone who knows how to build an effective advertising campaign. Don’t assume someone can build quality ads just because they’re in the business. Ask a lot of questions and make sure they understand how effective ads are built and what forms of media are most effective for what types of advertising. If they can’t explain it to you in a convincing manner they probably don’t know.

Rule # 2: Find the right message and don’t get too caught up in art or subtlety. While your ads should be appealing, appeal is in the eye of your consumer. The best ads are those that speak to your targeted consumer in a genuine and compelling manner. It doesn’t do you any good to get your name out if it’s not getting to the right people in a way that will appeal to them. If your message isn’t working, pull the plug and get it right.

Rule # 3: Repetition, repetition, repetition. Once you’ve found the right message you need to keep it in front of them. This reinforces your message to the consumers who have seen it and helps you attract new ones who haven’t. While there is a point of diminishing return you will usually not meet it for many years.

Rule # 4: Be focused and disciplined in your placement. While I said earlier that spending more is generally better than spending less, efficiency is the best approach unless your budget is unlimited. Select the media options that work best for your audience and your objectives.


Strategize First

Following these guidelines is not a guarantee of success but it will definitely improve your chances. A good advertising strategy can have an amazing effect on your business but bad advertising doesn’t do much beyond draining your resources. Find a professional you can work with a build an effective campaign that will fit your budget. Before long, your budget will start to grow to match your business success.