Retail Outlet
If You Can’t Beat Them, Maybe
You Should Join Them
For the past four years, I have written arti- cles for Response and have covered a wide variety of topics about taking products to retail, as well as the ins-and-outs of how
to effectively manage and grow retail distribution
and sales. Recently, I was approached by a direct
response company that had been successful in online stores and felt it was the right time to enter the
brick-and-mortar world of retail distribution. After
spending some time reviewing the product and history, I suggested that a co-branding/partnering approach with an existing brand could be a great way
for this company to enter the retail market.
The initial negative response was what can best
be described as a knee-jerk reaction based on ego.
The president of the company was shocked and
somewhat angry that I would even suggest that his
brand was not strong enough to stand on its own at
retail. Furthermore, he was adamant that his company had the ability to meet all the retail requirements
for distribution, inventory and logistics — and did
not need the help of an existing brand.
It took a while for me to calm him down and
remind him that he had already co-branded his
product for DR sales, not necessarily with another
“brand,” but rather with a well-known celebrity,
using the power and appeal of the celebrity to create a sense of credibility and endorsement for the
brand. We sometimes underestimate the brand that
a celebrity lends to a DR product.
Teaming up with an existing brand that already
has retail distribution cannot only save time and
headaches, but in many cases can be the difference
between a retailer accepting your product or not.
Most retailers today would prefer not to do business
with new startup compa-
nies to diminish the risk of
the product failing to sell
through at retail, or the risk
of the company going out of
business.
I am not suggesting that
you should “sell out” instead
of taking your product to retail yourself, but rather
opening up alternative avenues to explore in getting
your product to market. Do you want an example?
Dunkin’ Donuts certainly could have taken its own
coffee to retail, but instead the company opted to
focus on what it did best and let Procter & Gamble
(P&G) focus on its own strength.
In 2007, P&G announced that it would provide
Dunkin’ Donuts coffee to grocery stores, mass mer-
chandisers, club stores and drugstores throughout
the U.S. With Dunkin’ Donuts packaged coffee
at retail, consumers could enjoy Dunkin’ Donuts
coffee conveniently at home every day. Retailers
across the country responded enthusiastically to the
introduction of the popular brand. Select retailers
have promoted the brand in stores and in circulars
to alert consumers to the fact that Dunkin’ Donuts
coffee was “coming soon.”
Too often, we exclusively focus on our competi-
tors and how to beat them. But take a moment to
reflect on your potential “cooperators” — brands
you could work with to strengthen your position in
the market. Maybe it’s time to cooperate?
The power of retail distribution is getting
stronger every day. With the high cost of DR media
coupled with lower-than-usual conversion rates and
a “pre-programmed consumer” trained in an almost
Pavlovian way to wait for DR products to find their
way to the “As Seen on TV” section of retail store,
it is becoming critical for marketers to get smarter
about being successful in retail. The ratio of retail
sales to DR sales for many products today is as high
as 20: 1.
Don’t sit back and rest on your DR success while
your ego sits on a beach in Hawaii telling anyone
who will listen just how great your product is. Instead, get out and find opportunities that can help
you simply and easily accelerate your product’s route
to the best-suited retail shelves. As I always stress,
there is no shortcut to building a great retail brand,
but by being smart and keeping all options open,
success beyond your wildest dreams is possible. ■
