Brad wrote an excellent recap of some of his branding work at Hallmark.
There are lots of nuggets in this post, but what really stick out to me are his thoughts on adding new distribution channels while maintaining the traditional channels that got you to where you are today. In his example, Hallmark wanted to expand its presence by making a big push into mass retailers but not sacrifice their Hallmark stores and drugstore distribution. To pull one quote from the post . . .
Unleashing the power of the Hallmark brand in the mass channel resulted in substantial market share and profitability gains for Hallmark without taking away from the success of the card shop and chain drug store channels. (Hallmark card shops achieved consistent month over month sales increases for at least three years during this period, validating my held belief that the added marketplace exposure to the Hallmark brand would have a positive impact on all channels carrying Hallmark products.)
Any sales force is always going to moan over and/or fear the possibility of selling your product through another medium, be it a store front, the web, catalogs, etc. Few salespeople understand the importance of brand awareness and product exposure. They are all most interested in salesman awareness and salesman exposure. Naturally, your sales force is going to assume that having more channels of distribution is going to dilute their own chances for sales growth.
In my experience, this simply doesn’t happen, as long as the commitment to both the new channel and the traditional channel are both equally strong and appreciated. It can be destructive to the sales force when implemented poorly or when the new channel is strongly favored over the traditional channel. At this point, you have an altogether new strategy has been implemented, and that’s not what this post is about.
Increasing distribution options is just as much about increasing awareness in all channels as it is increasing sales in a single channel. Here are a few distinct reasons why:
- More exposures everywhere = more sales for everyone. Familiarity with a product is extremely important during the buying cycle. If the brand awareness is there, then that’s one less obstacle for the salesperson because the buyer has at least heard of your product. In addition, it sometimes leads to people finding you because they’re looking for the product due to exposure elsewhere. Not everyone buys a product at the same place they first see it.
- More introductions = more prospects for everyone. Part of the job of marketing is to make introductions to the proper selling agent. A good example would be the function of a website in a direct sales company. The beauty of the web is that it is accessible, it’s casual and it’s not an in-your-face sales presentation. But once the interest is created, the web can introduce the buyer to the appropriate sales channel/representative, be it a local representative, a nearby store or the online shopping cart feature.
- More success = more budget. This should go without saying, but if a company is committed to returning some of their profits back to the marketing budget, then high sales company-wide means higher support company-wide. This is another area where the sales force comes out on top.
- More options = more satisfied customers. Yes, you can “over-option” your product to where it just gives your prospect tired-head. But done correctly, where the customer receives certain areas open to customization, the customer sees value in what you offer. Some will prefer the no-hassle, low-touch channel of an online store. Others will appreciate the follow-up and hands-on approach of a local rep.
- More service = more value. The companies that appear to succeed with both retail store placement and individual stores or individual sales forces do so by providing more service outside of the retail store placement. Using Hallmark as the example, I know I can pick up a Hallmark card quickly at my local Target. (Actually, I must admit, I never look for a Hallmark card; I just look for a card, and it might end up being a Hallmark). However, if I need something special, I often go to my local Hallmark shop, because I know I can get more than just a card. I’ve gotten Christmas ornaments there, I know there’s more variety there and the staff are much more likely to help me out. They provide an extra service that I can’t get at Target, and I actually seek that out. The more specific the sales channel gets, the more it should be able to leverage service opportunities like this. The value will become clear to the consumer.
In my experience with direct sales/MLM sales consultants and industrial B2B salesmen, the argument over “chopping their legs out from underneath them” by exploring other sales channels is usually just the most convenient excuse for not succeeding. It rarely weakens the business, and when it does, that normally has more to do with buying trends in society and not the business.