By Steve Marzio
LOSE YOUR “DELUSIONS OF BRANDEUR” WHEN DEALING WITH RETAILERS (credit quote to Carol Spieckerman):
We get so wrapped up in the day-to-day business that is marketing and selling our wares to large, demanding, “the customer is always right” retailers, that we sometimes lose sight of some basic human nature principles which we could actually harness to gain some leverage in our negotiations with them. Many marketers of even the large, well known brand names backed with multi-billion dollars of total corporate revenue and $100+ million dollar ad budgets, feel like the David in the David v. Goliath relationship when it comes to negotiating with one of these big national retailers. This is because no matter what our brand scores may read from the market research studies or what our loyalty rates are, at the end of the day, the end consumer is not walking into our corporate offices to buy their syrup, computers or baby strollers, but rather into a retail outlet to spend their hard earned money. Your consumer is ultimately the retailer’s consumer. And every time they walk into our “partner’s” (and I lose that term loosely) well-lit, freshly painted, freshly mopped stores, they can choose to follow their brand loyalty OR they can easily get swayed to the competition OR opt to skip the purchase altogether.
READY, FIRE, AIM:
Put simply, what the end consumers see is simply the final decision of what that particular merchant decided to put out on that shelf, or on that endcap or in those checkout-lanes in that particular moment of time. Sometimes that merchant is a newly appointed college graduate given a lot of responsibility and other times the day-to-day decision maker might be a seasoned buyer of 20+ years. No matter who is choosing the placement, one thing is for sure. Once those decisions are made and retailers move into execution mode of supply chain and store operations, gone are the powerpoint charts and the negotiating tables, hello POS! Either your POS or someone else’s that is. And once there is POS, future decisions to expand, contract or maintain will be the most powerful data a retailer will use to drive future decisions.
So the road to proving ourselves with POS actually starts in the meeting rooms trying to convince merchants that our product is indeed the best choice for that shelf, or that endcap or in those checkout lanes. Most of our past 30+articles we have written and posted on here have focused on strategies and methods to increase your likelihood for expansion into big box retail. This article is no different, but may be a little more controversial. Some may consider this tactic….well….cheating.
BUYERS ARE PEOPLE TOO, GOSH DARN IT:
One of the most basic human nature principles is that there is absolutely no substitute for one’s personal experience. Obviously, having lived through or being exposed to some event, condition or stimuli gives one a stronger conviction in their opinion on a particular matter vs. not getting exposed to that experience. We tend to piece together many of our conclusions and opinions by piecing together tidbits of evidence that we have experienced or been exposed to in the marketplace….such as a marketing vehicle!
Here is something we often forget. The buyer is human. That’s right, no matter how old, how experienced or inexperienced, they have emotion and form opinions much like any other. If he or she owns a particular product, they form an opinion about that product. If he or she sees a TV commercial or a radio ad, he or she forms various opinions on those commercials (especially when it involves a product that they have some expertise in). An opinion can be as positive as “Wow that was creative/funny/informative!” or could be negative in some way. However, and perhaps more importantly than like vs. dislike of a particular marketing message, the buyer might simply takeaway the opinion that “Wow, that company is really out there marketing that product (i.e. creating consumer pull)” Most merchants, even the inexperienced ones, know enough that even if a product or marketing campaign is not directed at their demographic in particular, marketing campaigns that are raising awareness and creating consumer pull from any demographic is, in general, a good thing for the retailer.
I would argue that some merchants even go so far as using exposure or lack of exposure to a particular marketing campaign to help them to justify a decision they made in the past. When the buyer gets exposed to the marketing vehicles regularly in their personal life, this makes them feel that that they might be missing out on if they chose to not assort or promote that particular product. “Am I missing out on an opportunity here?” Or better yet, “is all this marketing going to drive customers to my competitor down the street that is listing that product?” (conversely if they see marketing and earlier chose to promote the product, this probably helps justify their decision)
WHY YOU SHOULD BUY BILLBOARDS IN BENTONVILLE (or the alliterative cousin, Mobile Marketing In Minneapolis):
If you have a marketing communications budget that is sizeable (i.e. over $100M), you probably don’t need to worry about this issue too much (since you most likely already have retailer support and plenty of coverage). However, if you don’t have a lot to spend and you need retailer support, you may want to think about dialing up marketing activity in the headquarter city of the retailer you are trying to penetrate. This may not help you in the short term if you are not on the shelves at all but could help you penetrate that retailer in the future. So buy a billboard or two in Bentonville, try local radio in Minneapolis, beef up your TV media schedule in Chicago. Ask your agency to come back with 10 cost-effective ways to blast a particular zip code to see what they come back with. (By the way, even though you may feel vindictive, you may want to avoid tagging the targeted retailer’s competition in this “blast”. Although one could argue sometimes dialing up the heat can get results!)
Dialing up your marketing efforts in retailer headquarter cities can be a relatively small investment to help bolster future success with that retailer and give you more chances to succeed in future discussions. Imagine going back into “Round 2” discussions with a particular retailer, after having some POS success elsewhere AND having the buyer say “yeah I’ve seen your ads all the time! I had no idea you were going to do so much!” Now that’s gaining some retail leverage!