How To Build A Culture Geared Toward Retail Leverage

By Vincent Young

Your company’s go-to-market leadership team is frustrated.

Marketing leadership is not satisfied with how your brand is positioned within the retail environment. They simply cannot believe that the market research, new feature-sets, sexy packaging, and communications campaign aren’t enough to get the retailer hot and bothered enough to displace the category leader and support you in a more significant way.

Behind closed doors, marketing managers question whether the sales team has actually presented the product line and brand strategy “correctly” to the retailer. Marketing believes that the sales team is behaving more like “account mangers” as opposed to aggressive sales agents for your company.

The sales team feels like they are being sent to a gun-fight armed with a pea-shooter. The often say, “Marketing seems to forget that we are, in fact, challengers.” The positioning of the new product line is simply not aligned with where the reseller is going with the category. The reseller is not willing to pay for or charge for the difficult-to-communicate feature or product performance improvements. The communications campaign is cute, but not impactful enough relative to the campaign that has just been presented by the category leader and it doesn’t align with the retailer’s communications strategy.

What are some real actionable practices/processes that your company can adopt to create a company culture that better aligns the organization and that leads to the development of better go-to-market plans that maximize your challenger brand’s better traction at retail?

Here are 5 practices that are sure to result in the creation of marketing strategies that offer greater leverage in the transaction with retailers:

Five Ways To Build A Retail Leverage Culture:

1. Tie each corporate executive’s bonus to growth at a “pet” retailer.

Create a bonus structure where each of your company’s senior leaders (including HR, Finance, Operations, etc.) is compensated based on the extent to which your company grows its business with a designated retailer. Believe me, executive engagement, input and direction in internal meetings will be very different as more company resources will suddenly become available to support the types of investments needed to win with assigned retailers, thus providing a greater form of leverage

2. Have the sales team do some heavy lifting during National Sales Meetings.

As a marketer, I hate it when I hear that there is a National Sales Meeting being planned because it usually means a ton of work for marketing and a ton of fun for sales! A healthy exercise for a National Sales Meeting is to have each sales team prepare and deliver a presentation in the presence of their peers and marketing based on the following hypothetical assignment – “Assume you were given $2 million of marketing funds (not including discount dollars) to launch a product at your account, how would you spend it and why?” This forces the sales team to think more like marketers and the marketing team to integrate traditional brand development programs with those that can best provide leverage at key retailers.

3.     Require product managers to model profit pool for their category at key retailers.

This model should itemize the total profit that each competitor (including private label) contributes to the retailer’s bottom line (including back-end programs). Most marketers of challenger brands have very little understanding of how a retailer actually makes its money and the order of magnitude that challenger brand proposals need to effect.

4.     Shop together and learn.

Create mixed teams of sales and marketing employees (in pairs) and assign each pair a series of stores to visit as if they were shoppers (even if the store is not in one of your key classes of trade). Each pair has to collaborate on and present the best example of challenger brand development (excluding private label) in the store and explain what your company could learn from their chosen example.

5.     Don’t enable the “Desktop Marketer.”

Too often today, marketing managers spend all of their time creating PowerPoint decks, sitting in conference rooms, writing e-mails, or making spreadsheets. To foster a “leverage-savvy” culture, all marketing managers should be required to lead a certain number of retailer pitches each year as part of their personal objectives.

Effecting changes in company culture takes time, but cultural transformations happen a lot faster when certain behaviors are modeled from the top. Try to implement a few of these practices in your organization and I’m sure you will like the improvement in team collaboration and retailer program development. Good luck!

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