Marketing and selling in favourable economic conditions:

Is ‘push marketing’ a blight on selling?

Prasanna Perera Marketing & Management, Consultant, Chartered Marketer, CIM U.K.

A PUSH strategy essentially involves pushing products into the distribution channels through distributors, agents, wholesalers, retailers and direct dealers. There is nothing wrong in this strategy, except that too much emphasis is being paid to same, without balancing the PUSH and the PULL. (Targeting end-users or consumers).

PUSH vs PULL Strategies

For the record let me outline push and pull strategies. Pull strategies are targeted at end-users/consumers through advertising and consumer promotions. Push strategies target distribution intermediaries, through trade promotions, intermediary competitions etc., A good balance between the Push and Pull is required. Why? If there is more Push than Pull the distribution channels will be overstocked. On the other hand, excessive Pull will result in stock-out situations. Neither is desirable from a professional marketing standpoint.

Why do Sri Lankan Marketers emphasize the Push Strategy Over the Pull?

I have observed that both consumer and industrial goods marketers concentrate more on the Push than the Pull. (BTL - below the line over ATL - above the line). The reasons to my mind are outlined below.

Firstly, in most organizations salespersons call the shots over the marketers. The belief is that if you Push, you can sell. There is no need to create demand Pull.

Since Sri Lanka is a developing country, the traditional retailer (shops) dominates over the modern retailer (supermarkets and self service stores).

Hence, it is believed that by incentivizing the traditional retailer, they will Push the products/brands. Therefore, the retailer is expected to change the consumer mindset at the point-of-purchase.

Retailers and wholesalers are also becoming demanding, since they have many suppliers knocking on their doors. The balance of power has clearly moved away from the manufacturer to the distribution intermediaries. Top Management also encourages short-termism i.e. achieving this months and next months targets. Therefore, once again the Push strategy is seen as the savior.

Accountability for expenditure is easier with the Push, when compared with the Pull. Push strategies can be measured in terms of sales and profit impact, in the short term.

Pull strategies are harder to measure (specially advertising), since they have a lag effect and results are seen long term.

Marketers lack assertiveness, over the sales teams. Most brand managers and executives also target the marketing principles and get pressurized to go for short term gains. Lack of good market research inputs, also results in Push strategies given preference over the Pull. Organizations have not researched the consumer/end-user-decision making process. Hence, they are assuming that the Push is what generates sales revenue and volume.

The Dangers in Over Emphasizing the Push Strategy

The biggest danger is that brand equity will be eroded in the long term. Consumers/end-users will lack awareness about the brand being marketed and demand Pull will decline.

Consumer loyalty will be compromised for intermediary / trade loyalty. This is a dangerous trend, as traders loyalty is directly related to functional benefits (profits), as opposed to emotional benefits desired by consumers/end-users.

Many intermediaries are pampered by foreign trips, weekend holiday packages and many other incentives. In fact, many distributors and dealers are travelling the globe at company expense.

My question to Marketers/Sales Persons is “do these incentives make intermediaries more loyal to your organizations and brands?” What would happen if better offers are made by your competitors? For example your organization offers a trip to Bangkok and a competitor to Europe.

Too much of Push, also creates price based competition, as products and brands are commoditized.

This is detrimental to organizations in the longer term, as profit margins get eroded, together with the working capital situation.

What is the Solution? A Balance Between the Push and the Pull Balancing the Push and the Pull is what should be done.

Do not neglect the end-user, as well as the distribution intermediaries. Allocate marketing budgets accordingly. Conduct continuous market research to understand market trends and end-user buying behaviour.

By creating demand Pull, the balance of power can be pulled back from the intermediaries, to a certain extent.

Do not forget marketing principles. The consumer is the final authority, in the long term, specially with the modern trade growing in Sri Lanka.

In the next 5 - 10 years the entire Push ball game will change.