311. The Trade Marketing Reality Check Every Brand Needs

0:00Trade marketing isn't broken. You were never taught the system. Why trade marketing feels like a tax? If you're an emerging CPG brand, trade marketing probably feels like this. You spend money, you run promotions, you follow the retailers plan and somehow your margins shrink, your cash flow tightens and your growth feels unpredictable. So you start asking, why does this feel so hard? Why does this feel like I'm paying to stay on the shelf? Why does it feel like every promotion is a gamble. Why do my promotions just generate more deductions? Here's the truth no one says out loud. Trade marketing is not broken.

0:40The way you've been taught to use it is. Because most founders are taught tactics instead of strategy, tools instead of thinking, activity instead of outcomes. And that leads to one dangerous pattern. Trade spend becomes a tax instead of a growth engine. But when you understand how this system actually works? Trade marketing becomes your biggest growth lever, your fastest way to extend runway, your unfair competitive advantage, and how you compete with bigger, better funded brands and win. That's what we're going to fix today. The story, when it finally clicked. Early in my career, I saw something that didn't make sense.

1:20I was working inside a big CPG company, managing promotions, reviewing performance, and on paper, everything looked good. Sales were up, promotions were working, volume was growing, but something felt off. Because when I looked deeper, the category wasn't growing, profitability was inconsistent, our base volume was declining, and we were repeating the same promotions over and over. Rinse and repeat is not a strategy, and this is what most brands are taught. What's the definition of insanity? That's when I realized we weren't building strategy, we were running plays, and those aren't the same thing.

1:59Around the same time, I started working more closely with retailers, and I saw the other side of the equation. Retailers weren't asking, did your sales go up? They were asking, did this grow the category? Did this bring in new shoppers? Did this improve profitability? Did this increase profits? That's when it clicked. Trade marketing isn't about promotions, it's about behavior change, and most brands completely miss that. Behavior is trading shoppers up, increasing foot traffic, increasing trial, growing contribution. What goals are you setting for your promotions? The hidden cost and play in sight.

2:37Let's simplify this. Trade marketing is typically 25 % of your gross sales, and yet 70 plus percent is wasted or ineffective. Let that sink in. That should sting, especially for emerging brands with limited runway. This isn't a small inefficiency. This is the difference between surviving and shutting down, scaling and stalling, raising capital, and running out of cash. And here's what makes it worse. Most brands don't even realize this is happening because they're measuring volume, lift, and activity. Why? Because this is what our industry teaches you. Instead, start asking, did this actually create incremental growth?

3:18Did that promotion achieve its objective? That's the game. And if you don't understand that, you'll keep spending money without momentum. Here are the top five ways to maximizing your trade marketing. Number one, trade marketing fails without a system. Most brands treat trade marketing like a checklist. Run a promotion, pay a fee, get a display, and hope for lift. But here's the problem. trade marketing only works as a system it must connect planning pricing promotion strategy execution measurement and it must include how your customers shop miss one piece and everything weakens this is why promotions feel random results feel inconsistent and nothing compounds the shift stop asking what promotion should we run start asking what system drives our growth action step.

4:12Write this down. Our trade strategy is designed to change what behavior? If you can't answer that clearly, it's time to rethink why you are promoting. That's the starting point. Number two, most promotions don't drive growth. They subsidize it. Here's one of the most misunderstood concepts in CPG. Not all sales are good. There are two types. Number one, subsidize sales. Sales that would have happened anyway, just discount it. Number two, incremental sales, sales that only happen because of the promotion. Most brands celebrate volume spikes, but retailers evaluate incrementality. If your promotion discounts loyal shoppers, pulls demand forward, doesn't change behavior, you're losing money.

4:59The shift, stop asking, did sales go up? Start asking, did we create a new behavior? There are better, more effective ways to reward existing customers, and I talk a lot about this in other podcast episodes. Action step. After your next promotion, ask, did we attract new shoppers? Did we increase basket size? Did base sales grow after? If not, that promotion didn't work. Number three, retailers don't want more promotions. They want better ones. Most founders believe retailers want more promotions. That's not true. Retailers want fewer promotions, better outcomes, more predictability. They're asking, did this grow my category?

5:43Did this bring in traffic? Did this improve margin? Did this give me a competitive edge? Promotions that do that earn trust. Promotions that don't quietly lose support. The shift? Stop thinking like a brand. Start thinking like a retailer. How does this help them win? I know this can be confusing when retailers are constantly telling you to promote. That is because some retailers are more interested in the fees they charge than growing the category sales or making their shoppers happy. That behavior can also be changed when you first focus on maximizing your trade marketing ROI. This puts their customers first.

6:23Helping retailers rethink their promotion strategy is something I cover in the free download at the end of this episode. Action step. Build your next promotion around traffic, basket size, category growth. That's how you stand out. Number four. Execution is where everything breaks. You can have great strategy, great pricing, great planning, and still fail. Why? Because execution is everything. Let's make this simple. Shoppers can't buy what they can't find. Most failures come from poor merchandising, out of stocks, inconsistent placement, and broken communication. And when that happens, retailers assume their product failed, even when demand is strong.

7:05The shift? Treat execution like a system. Placement, inventory, replenishment, store-level consistency. Use scorecards to schedule every aspect of the promotion. Assign who's responsible, and then hold them accountable. Floss execution will dramatically improve your trade marketing ROI. Action step, create a checklist. What must be true in every store for us to win? Then enforce it. Number five, trade spend becomes dangerous without discipline. Here's what most founders don't realize. Trade spend compounds quietly. Promotions stack year over year. Cost increase, margin shrink, learning doesn't happen, and you teach your shoppers to only buy your brand when discounted.

7:49And suddenly, trade spend grows faster than revenue. That's when brands get into trouble. Not because sales drop, but because cash disappeared. The shift? Trade marketing is not the cost of doing business. It's a strategic investment. It's your primary growth lever when used correctly. Action step. After every promotion, answer. What worked? What didn't? What changes next time? If you're not doing this, you're repeating expensive mistakes. Since most brands lack the discipline to do this, you will gain an incremental advantage each time you make this a priority. Recap What actually works? Trade marketing works when you build a system, not just run tactics.

8:34You focus on incremental growth, not just volume. You align with retailer goals, not just your own. You prioritize execution, not just strategy. You create learning loops, not just activity. Fix these and everything changes. Your promotions become predictable. Your margins stabilize. Your retailers trust you. Your runway extends and shoppers place more value in your brand. The real opportunity? You don't need more promotions, more spend, more complexity. You need clarity, discipline, and a system. because trade marketing isn't the problem. It's the fastest path to growth when done right. And when you understand it, you don't just compete with bigger brands.

9:18You outmaneuver them. If this episode helped you think different, download the free trade marketing essentials guide at the end of this episode, or you can go to retailsolved.com slash guide 15. And you can also get it on the show notes at retailsolved.com slash session 311. Go deeper into the new items essential system and share this with a founder who's spending money but not seeing results. Because you don't need to spend more to grow. You need to spend smarter. I'm Ben Lomond, and this is the Bulletproof Your CPG Brand Podcast. Stop wasting money. Want to know how to explode sales? Here's this week's free downloadable guide.

9:56Trade marketing includes everything required to get your brand in the hands of shoppers. It's your growth engine and the largest item on your P &L. Trade marketing is crucial for your brand growth, but 70 % of trade spending is wasted or ineffective. Learn the essential strategies and tactics to save you money and boost profits. Thanks for joining us today. Please reach out and share your most pressing questions and I'll do my best to get you the answers that you need on future episodes, including expert advice from CEOs and industry thought leaders. Comment, leave your questions, and get this week's free downloadable guide and the show notes at retailsolve.com session 311.