Practices, concepts and strategies that can be implemented to gain leverage. May contain examples, but is more of a teaching point.

More Margin More Retail Problems?

By Benjamin Smith Hand It Over! A retailer asking for more margin?  Not shocking – or ridiculous.  It’s a free country – you can decide if you want to offer more, or stare them down.  Unless they have no respect for you or  your brand, in most cases, when they ask for more margin they [...]

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How To Maxx Out Retail er Leverage (With Unwilling Help From Apple’s IPAD)

I don’t care whether you are a retailer or a brand marketer, I just know that at some point on Friday November 19, 2010 you wished you had the same idea that some genius(es) at TJ Maxx did.

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Product Specification: A Shield in the Battle Against Private Label at Retail

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As long as I can remember, only two brands of toothpaste have mattered – Crest and Colgate. I use Crest. Why do I use Crest, you ask? Because, as a very young child, our family dentist used Crest during my annual check-up and he then gave it a tacit recommendation that we should be using it too when he gave me a sample tube of Crest (along with floss and a new toothbrush). From that moment on, my Mother would look for the Crest brand of toothpaste for our family to use. When a brand is either directly or indirectly specified as “appropriate for optimal effectiveness” by an expert or by a complimentary good, then your brand’s ability to wield assortment, pricing, and promotional power at retail increase significantly. Sounds like a recipe for Retail Leverage (or inoculation against private label).

So how do you protect yourself?

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Want To Gain Big Dollar and Lots of Leverage In General At Retail? Look Closely To Find The Answer.

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This article explores pushing the boundaries of your own retail comfort level and looking at channels that aren’t necessary alternative, because they are already selling products from your category. I’ve got 2 great examples of retailers in this story – and as the title suggests – they might hold the key to big dollar and lots of leverage in general!

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The Retail Leverage Principle of Physics – When Two Opposing Brands Are Better Than One

By Vincent Young Most categories at retail have room for a “good-better-best” stratification of category players. In today’s culture at retail, the retailer is predisposed to seek ownership of the “good” position by introducing an opening price-point category alternative under a private label or house brand. As a result, branded suppliers typically feel compelled to [...]

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Home Depot Builds Something Too Big To Ignore

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WATCH & LEARN – HOME DEPOT DECLARES BLACK FRIDAY IN APRIL:

The fight for Retail Leverage doesn’t end with brands duking it out in the aisles. Retailers take it outside, fighting their own battles. If you think unemployment, the real estate market, and tight credit has hurt sales for your brand, imagine how that rolls up to create a desperate environment for the retailer. While the home improvement sector in retail is still fragmented, the two resounding leaders are Home Depot and Lowes.

Home Depot, in a bid for some Retail Leverage of its own, and in an effort to drive year over year sales growth, has declared “Black Friday Is Back”, creating their own retail big event.

To read more, click on title.

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What Is The Retail Blue Ocean Sales Strategy?

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SUMMARY:
I don’t know if I’m suggesting something as radical as the authors of the book “Blue Ocean Strategy” would suggest – I’m merely advocating you change the channel by looking beyond your existing business. That being said, pursuing new channels does have some similarities to the core philosophies shared in “Blue Ocean Strategy”. Think about your existing retail channels in context of the Red Ocean Strategy below, and then look at the Blue Ocean Strategy. It makes a Blue Ocean Strategy in retail seem worth a shot.

Key Benefits To Pursuing An “Alternative Channel” Strategy:

1) If you successfully develop new customers, you lessen your dependance on existing customers
2) Experience serves as a “Learning Lab” where you can test new ideas & apply learnings in your existing channels
3) Opportunity to create new demand for your product by positioning it for specific applications / uses
4) Growing sales in new channels may help lesson impact of seasonality in your existing channels
5) Buyers / merchants tend to stay within the retail industry – your new friends may pop up in your existing channels down the road.

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STAINMASTER Carpet Goes Wall-to-Wall at Lowe’s

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While the STAINMASTER brand has considerable equity in the home furnishings and flooring industries, the team at INVISTA was able to gain distribution at the world’s second largest DIY/Hardware chain by thinking like a challenger brand and adopting two key strategies to gain Retail Leverage.

Retail Leverage Principle #1: Bring Pent-up Demand to Stores
Retail Leverage Principle #2: Offer Product or Program Exclusivity

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You Can Be Skeptical of MagicJack – But Not How They Got Retail Leverage

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SUMMARY:

MAGICJACK: RETAIL AND DIRECT IN PERFECT HARMONY:

So you might ask yourself wasn’t MagicJack giving up something by tagging retailers, effectively pointing potential customers to stores?

Well they can start dialing back their Direct Response spend, or at least keep it flat. Plus after 2-3 years of hitting the airwaves hard with the same product, there are diminishing margins of return on the number of people who will buy your product direct. Chances are they saw the ad – if they were going to buy it direct they would have done so already.

Retail represents an untapped market. There are people who won’t buy direct, or maybe never even saw it on TV. And there is a good chance the retail margin they’ll pay is probably close to the cost per order to sell direct (media costs + fulfillment.

LESSONS LEARNED:

1A) Infomercials are a great vehicle for telling a story and building demand at retail.

1B) Marketers with a holier than thou attitude towards Direct Response TV (DRTV) are ignoring a viable tactic.

2) Take risk away from the retail buyer. This makes it easier for them to list / support your product. MagicJack wouldn’t be at retail if they didn’t have a success story from their direct experience, as well as ongoing aircover in the form of their DRTV spots they continue to run that in effect are ads for their retail placements.

3) There is less risk in balancing a direct and retail strategy than ever before. The battle lines have been blurred by retail consolidation, and the growth of private label. I don’t think the retail buyer spends much time worrying about where you are selling your product, as long as it is selling well in their stores. We spend way too much time worrying about who we compete against, versus just selling.

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Will Your Brand Be Up To The Challenge At Best Buy?

We here at Retail Leverage are big fans of Best Buy, so we were delighted when BusinessWeek took a look at Best Buy in the post-apocalyptic environment after the demise of Circuit City. While Walmart and Amazon are worthy foes, Best Buy is the only large national consumer electronics player left standing. However important Best Buy was before as part of the buying process – regardless of the final point of purchase – Best Buy is now ready to take advantage of its position.

If you are a challenger brand marketer (or an agency working with one) there are lots of takeaways.

To read the full article, click on the Title.

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