Which statement best describes trade promotions?

• A. Directly targets end consumers with discounts.
• B. Promotes awareness among wholesalers.
• C. Involves incentives to retailers or distributors to stock or promote a product.
• D. Trade promotions are used only for seasonal campaigns.

Answer: (C)

Trade promotions focus on the distribution channel, offering incentives to intermediaries to stock and promote a product. The aim is to motivate retailers or distributors to carry more of the product, feature it in-store, and support it with their own marketing funds or in-store activities. This can take the form of trade allowances, display or advertising support, buy-downs, and other funds that help the product move through the shelf to the customer. Because of that emphasis on channel partners and their stocking and promotion decisions, the statement describing trade promotions as involving incentives to retailers or distributors to stock or promote a product is the best fit.

In contrast, consumer promotions target end customers with discounts or offers, which is a different approach. Saying the goal is simply to promote awareness among wholesalers doesn’t fully capture the incentive aspect aimed at getting retailers to stock and actively promote the product. And assuming trade promotions are used only for seasonal campaigns ignores how they are used year-round to support ongoing assortment and shelf placement.