Sales Promotion Strategies for Godiva Brand

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Date Submitted: 06/24/2008 04:04 AM

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I. Sales Promotions

a. Trade promotion

Godiva chocolate has been distributed to more than 9 different types of gourmet shops from exclusive Godiva Boutiques, duty free shops and department stores all over the world. Godiva, besides its own special stores selling only Godiva products, seeks for retailers with high value-added capabilities such as advertising support, loyalty cards, significant merchandizing expertise and cost-saving programs. Godiva prefers following types of trade promotions:

1. Off-invoice Promotions

2. Performance Promotions: Display Allowances, Gifts to the sales force

3. Co-op Advertising

First trade promotion given to the retailers are quantity discounts or so called off-invoice allowances, ensuring that Godiva chocolates are the affordable luxury, in return for a greater quantity bought and supposedly sold by a retailer . These discounts will vary for different corporate distributors and are calculated on total merchandize on a per order basis and exclude gift certificates. These promotion events will take 2 to 3 weeks during the lowest- demand periods which will ensure harmony in merchandized quantities. Retailers will than have a full right to put adjustable mark-ups onto the list price for which products were purchased.

Furthermore, Godiva will pay its retailers a display allowances for their selling effort, such as building displays and increasing shelf space. Such performance promotion is favored by Godiva into more extend that off-invoice one because it reduces the power of retailer and thus provide Godiva with a greater control of channel activity by the usage of scan-backs and bill-backs. To motivate the crew, Godiva will quarterly distribute free gifts to the retailers which will differ according to the amount of products sold by a particular store. Same strategy applies for the staff of Godiva Boutiques.

Additionally to these two forms Godiva intends to develop co-op advertising together with duty free shops,...