Piggyback Promotion

Posted in Marketing and Strategy Terms, Total Reads: 507
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Definition: Piggyback Promotion

Piggyback promotion is a promotion strategy carried out by firms where they bundle another non competing product with their own product and sell it. This strategy is often a low cost strategy which are carried out by the firm. For example, a firm making toothpaste may choose to bundle a tooth brush with their product. This way they are giving a complete set of brushing to the customer.

 

The companies indulging in Piggyback promotion are benefited both ways. The firm which introduces this offer often ends up in doing high sales and the bundled product gets good publicity out of it. A firm can indulge in Piggyback Promotion because of a lot of reasons. One of the reason may be that the firm may be making losses and wants to increase sales. So, if a customer wants to buy a product, say toothpaste, will buy a toothpaste which is giving it something more in return than just simply buying the toothpaste. Also, if the firms want a good market share they may choose such strategies.

 

There are several pros and cons of indulging in Piggyback Promotion. The pros are that of higher sales volumes, greater profits, good product visibility, increase in brand loyalty and many more. However, if a firm chooses to do this kind of promotion it may well become a norm to give out such products after a period of time. For example, if one company starts giving out toothbrush along with its toothpaste, all other companies may have to start giving those. A company which would not give it may well be at a loss. Also, there are issues of legality and ethicality revolving around such offers as it kills other companies share who produce only one product (like the toothpaste).

 

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