What is Retail Leverage?

This is the only blog dedicated to sharing and discussing the strategies, programs, and other best practices designed to give “challenger” brands the ability to shape and influence their fates within the world of retail.

Across the ever-contracting landscape of U.S. retailers, only a small, privileged set of category-leading national brands have the power to deliver on the value-propositions upon which their business models are based.

Why? Because over the past twenty years, retailers have become power-brands themselves – seeking to be known not only as destination sellers of goods, but as actual participants in the key categories of market interest.  In addition, many retailers today seek to differentiate themselves by promising consumers an expertise that supersedes that of the individual brands they sell and by offering “exclusive” products that make the retailer seem more special than the national brand who actually provides the solution.

The concept of Retail Leverage refers to the desire that most challenger brands have to maximize their influence on the assortment, pricing, promotions, merchandising, and advertising that support their value propositions and deliver maximum returns in an environment controlled almost entirely by the more powerful retailer who dictates the rules of category engagement with the consumer.

Why a blog about Retail Leverage? The most obvious reason is that most of the conversations and documented examples of best-in-class marketing strategies are those put in play by well-funded category leaders who are able to implement their brand initiatives in “partnership” with retailers (or independent of the retailer altogether).

The reality is, however, that most companies are not developing their go-to-market plans as partners with retail or from a position of equal power as the retailer. Most brands rarely realize the full vision of their marketing plans after their consumer packaging gets re-designed by retail buyers, their product portfolio becomes cherry-picked to fill the assortment voids of the category leader, and retailer private labels erode the price premiums that justified the value-added features that the national challenger brand counted on as a basis of differentiation.