Final answer:
When a firm uses a push strategy, it offers direct inducements to wholesalers and retailers to encourage them to carry a product. Option D of the choices provided is correct. A push strategy focuses on promoting products to the next level of the distribution chain.
Step-by-step explanation:
When a firm uses a push strategy, it offers direct inducements to potential wholesalers and retailers to encourage them to carry a product. This strategy involves convincing channel members to offer the product and push it through the distribution channel to the end customer. This is in contrast to a pull strategy, where the goal is to establish strong customer demand that pressures distribution channels to carry the product. Answer choice D captures this concept of direct inducements which may include discounts, premiums, incentives, and allowances provided to the trade.
Differentiated products in monopolistic competition
Advertising in monopolistic competition is employed to make consumers believe that a firm's products are different from its competitors. This can be achieved by making the firm's perceived demand curve steeper or by shifting it to the right, indicating increased demand.
Advertising challenges and strategies
Although not necessarily requiring a larger budget than a pull strategy, as option B suggests, a push strategy requires dedicated efforts to persuade resellers to carry the product. Firms do not have to immediately follow a push strategy with a pull strategy; these are separate avenues that can be independently pursued based on the marketing goals and market conditions.