Promotion of agreement: Overview, definition, and example
What is promotion of agreement?
Promotion of agreement refers to the obligation of one or both parties to actively support, market, or publicize an agreement, product, or service as part of their contractual duties. This often appears in business partnerships, sponsorship deals, and distribution agreements where visibility and awareness are key to success.
Why is promotion of agreement important?
Promotion of agreement ensures that both parties contribute to the success of their partnership. For example, in a marketing or distribution deal, one party may be responsible for advertising a product, while the other provides the product or service.
This clause is especially important in industries where brand visibility, customer outreach, or sales volume plays a significant role in profitability. Without clear promotional obligations, one party might not put in the effort needed, leading to disputes or an underperforming agreement.
Understanding promotion of agreement through an example
Imagine you own a small software company and partner with a larger firm to distribute your app. The larger firm agrees to list your app on their website, feature it in their email campaigns, and mention it at industry events.
If the contract includes a promotion of agreement clause, they are legally required to make reasonable efforts to promote your app as agreed. Without such a clause, they might deprioritize your product, leading to lost sales and a weaker partnership.
An example of a promotion of agreement clause
Here’s how a promotion of agreement clause might appear in a contract:
“Both parties agree to actively promote and market the subject matter of this Agreement. The Promoter shall undertake reasonable efforts, including but not limited to digital advertising, social media engagement, and event participation, to increase awareness and visibility of the products/services covered under this Agreement. Failure to execute promotional efforts as outlined may constitute a material breach of this Agreement.”
Conclusion
A promotion of agreement clause helps ensure that both parties are actively contributing to the success of a deal. It prevents situations where one side benefits while the other does all the work.
For SMBs, this clause can protect their interests when partnering with larger companies, distributors, or sponsors. Clearly outlining promotional responsibilities in contracts ensures fair participation and better business outcomes.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.