Promotion - Into-the-Pipeline

Question 1

What is promotion?

Answer 1

Promotion is a process of raising awareness of products and persuading customers to buy them.

Question 2

What are promotion types?

Answer 2

• Into-the-pipeline
• Out-of-the-pipeline
• Public Relations

Question 3

What is Into-the-pipeline?

Answer 3

Into-the-pipeline sales promotions are offered by the manufacturers to encourage retailers to purchase products from them.

Question 4

What are methods of into-the-pipeline?

Answer 4

• Trade credit
• Point of Sale (POS) materials
• Sale or return
• Dealers loaders
• Staff training

Question 5

What is trade credit?

Answer 5

Manufacturers offer retailers credit to pay for goods at a late date.

Question 6

What are the advantages of trade credit?

Answer 6

• No cash is required to stock products, which is good for new or struggling businesses.
• Retailers can purchase goods and then pay for them once they are sold.

Question 7

What are the disadvantages of trade credit?

Answer 7

• This could lead to bad debt if retailers are unable to sell the goods and repay the supplier.

Question 8

What is Point of Sale (POS) materials?

Answer 8

Free posters and display materials are given to retailers to display products to customers.

Question 9

What are the advantages of Point of Sale (POS) materials?

Answer 9

• This can enhance the look of the retail store.
• It can draw customers’ eyes to the product on display.

Question 10

What are the disadvantages of Point of Sale (POS) materials?

Answer 10

• Retailers may need to dispose of bulky display materials at the end of the promotion.

Question 11

What is Sale or return?

Answer 11

Manufacturers give retailers the option to return goods that do not sell.

Question 12

What are the advantages of Sale or return?

Answer 12

• It allows retailers to try new products without the risk of being stuck with unsold inventory.
• It improves cashflow.

Question 13

What are the disadvantages of Sale or return?

Answer 13

• Products may be returned in a poor condition, creating waste.

Question 14

What are Dealer loaders?

Answer 14

Discounts used to encourage retailers to stock up on a product.
Example: Buy 10 boxes get 1 free

Question 15

What are the advantages of Dealer loaders?

Answer 15

• Retailers can save on the unit cost of products, allowing greater profits.
• Savings can be passed to customer to increase sales revenue.

Question 16

What are the disadvantages of Dealer loaders?

Answer 16

• Retailers may overstock and find they are unable to sell.
• Products might go out of date or out of fashion.

Question 17

What is Staff training?

Answer 17

Manufacturers can offer retailers staff free training to give them the skills and knowledge to sell the products.

Question 18

What are the advantages of staff training?

Answer 18

• Staff become experts in the products, which can impress customers.
• The quality and motivation of staff are improved.

Question 19

What are the disadvantages of Staff training?

Answer 19

• Training has to be done during normal hours, which reduces productivity, or after hours, which will increase overtime pay.