Increasing promotional spending in the US

According to a Nielsen survey conducted in the US, an increasing number of manufacturing enterprises use promotions. Both manufacturers and retailers want promotions to be effective. Both sides regard a better understanding of customers as a key element of effective promotional activities. While the management of retail companies focuses on boosting customer loyalty, manufacturers focus on new product introductions and category management. Promotional and advertising budgets are growing year by year. However, a significant proportion of managers consider their promotional budgets to be insufficient. Three out of five manufacturers plan promotional activities for themselves, while nine out of ten report that their retail partners are satisfied with the results of promotional activities. The majority of manufacturers define specific sales targets for promotional stocks. The main objective behind promotions is boosting sales and market share. Companies with an annual turnover of less than USD 1 billion place special emphasis on boosting customer loyalty. Most manufacturers inform their retail partners of the results, at least occasionally. According to 81 per cent of manufacturers, promotional prices are generally determined jointly with retail partners. Only 3 per cent does this without consulting retail partners. No major changes have occurred in the proportions allocated to various in-store promotional methods, with the exception of increased spending on promotional placements. Promotional periods are also getting longer.