Immersion in trade marketing, a key strategy in the supplier-distributor relationship

In recent years, a number of new developments have changed the face of trade and marketing. The relationship between suppliers and distributors has evolved along the lines of trade marketing: a methodology that enables both parties to benefit from a well-tended relationship. What is the role of the trade marketer and how can he improve relations between business-to-business partners? Our business school takes a look at trade marketing.

What is trade marketing?

In French, this is known as distribution marketing. This discipline brings together all the marketing strategies implemented in the context of product distribution and supply chains.

In simple terms, trade marketing is where the supplier/distributor relationship lies. This is also known as distribution marketing in B2B sales strategies. The supplier must consider the distributor as a customer. Products are optimised to meet the needs of the end consumer, at the end of the chain.

Trade marketing is therefore one aspect of marketing, but it has its own specific features. It has a specific objective: to reduce costs as far as possible, optimise profits and improve sales and product efficiency. It is therefore part of the response to the needs of the end customer, while strengthening the relationship between intermediaries (distributors).

Where does trade marketing come from?

The concept of trade marketing emerged in the 1980s in the context of distribution. It first appeared in a book by Étienne Thil and Claude Baroux.

The early 1990s saw the emergence of hard-discounting, as well as a change in consumer habits, with consumers becoming less loyal to a particular brand. In the midst of the crisis, manufacturers decided to change their strategy and began to target distributors. The distributors, for their part, are concentrating on their positioning in terms of their target, while the manufacturers are focusing on their commercial relations with the intermediary customer, the distributor.

Trade marketing is evolving with the rise of modern marketing. It provides a concrete response to the needs of retailers and distributors. This adaptation to changes in consumer behaviour is overturning the standards hitherto seen in the marketing professions, and opening up a host of opportunities in all markets.

What is the aim of trade marketing?

Trade marketing fulfils several objectives thanks to its business-to-business merchandising approach: :

• Increase product visibility. This includes maximising their presence at the point of sale.
• Stimulate sales. By creating opportunities to increase sales through targeted promotions.
• Strengthening distributor partnerships. As we have seen, this area of marketing is an excellent way of improving relations between distribution channels and manufacturers.

More specifically, it involves optimising the supply chain to reduce costs and provide effective solutions for both distributors and manufacturers.

What are the advantages of trade marketing?

The benefits of trade marketing for consumers

The consumer is one of the primary beneficiaries of this trade marketing strategy. They are better supported in their purchasing process. Product suggestions are made both online and in-store.

Trade marketing operations can also lead to promotions from which the end consumer can benefit.

The benefits of trade marketing for distributors

Distributors can increase their sales volume, and therefore their turnover, through trade marketing, which encourages the promotion of certain products.

The aim is a win-win partnership: the supplier's sales increase in tandem with those of the distributor.

This type of operation also has other beneficial effects, such as additional advertising revenue and attractive promotional campaigns to build customer loyalty.

 

The benefits of trade marketing for suppliers

The supplier, for its part, sees its reputation strengthened. They can promote their products in a variety of ways directly at the point of sale, in the shops of their partner, the distributor.

How do you go about trade marketing?

The trade marketing plan is divided into several main stages:

1. Identifying the right partners

This first stage involves selecting commercial partners who can share a common interest in the trade marketing approach. The trade marketing manager must be keen to propose useful partnerships that can contribute to the growth of both the distributor and the supplier.

2. Establishing the marketing actions to be take

The decision must be based on the objectives of both parties. Various actions can be envisaged:

• merchandising ;
• commercial events ;
• digital promotion (emailing, promotional operations on the web and social networks, display, etc.).

3. Negotiating the commercial relationship

The next step is to establish the ins and outs of the commercial contract governing the trade marketing activities. The various conditions can be negotiated.

4. Monitoring results

As with any project, the final stage involves monitoring progress and carrying out frequent reviews to measure the impact of the actions taken.

Key performance indicators (KPIs) are the main tools used at this stage. They help to determine the success or failure of the trade marketing operation.

What are the trends in trade marketing?

The discipline of trade marketing is also following its own trends, like the markets and the economy in general. Among other things, trade marketing is adapting to digital platforms. More targeted and segmented offers are emerging, thanks to better use of customer data. Analysis of modern trade marketing strategies and knowledge of data-related issues are essential in these professions.

On the other hand, there is a fairly strong trend towards CSR, with brands making more and more environmental commitments. The advent of artificial intelligence and machine learning is also leading the way in this area.

The trade marketer's job

Trade marketers have a variety of responsibilities. They revolve around 3 main areas:

• devising promotional strategies ;
• inter-departmental collaboration;
• monitoring campaign performance.

To do this job, the trade marketer calls on a wide range of skills, but above all he or she needs to demonstrate considerable expertise in market analysis, as well as advanced communication and negotiation skills.

Training to become a trade marketer at IPAG

If you want to train to become a trade marketer, there are two routes available at IPAG:

• Master's degree in digital marketing: a 5ᵉ year specialisation enabling you to acquire the core skills of the digital marketing professions. Gain many useful skills for your trade marketing projects: webmarketing, CSR, communication, digital economy, etc.
• Master's degree in marketing: this course focuses more on business to consumer specialisation, but is an ideal way of mastering the nuts and bolts of strategic marketing. You'll be up and running in no time, ready to take on future trade marketing roles. The units taught cover both a core curriculum and digital marketing, distribution, communication and the media, strategy, branding and product management.

Find out more about careers in trade marketing and marketing in general by getting in touch with our business school. Ask us about your future business studies or sign up for a course at IPAG Business School.