THE FRONT: WHERE BRAND INNOVATION LIVES OR DIES
While the focus of the article was on consumer packaged goods (CPG) manufacturers and their retailers, it certainly applies to durable goods manufacturers as well. The researchers found that the retailer actually plays a major role in the success or failure of any product innovations the manufacturer introduces to the market.
The reason Huebner Marketing decided to focus on building brands and marketing programs for manufacturers years ago was precisely because of this phenomenon. We found that the corporate marketing department can make the best-laid marketing and brand-building plans in the world, but if they don’t have the buy-in or an answer to “What’s in it for me?” for the local dealer… it may all be for naught.
HERE’S A GOOD EXAMPLE…
Years ago, one of our clients introduced a new standard feature that revolutionized the customer experience with their product. But had they added the feature and not had the dealers jumping for joy over it, it may have only seen mediocre success. Instead, with marketing materials behind it, sales training around it, and an international sales event featuring it, it contributed to a banner year for that client. And, they couldn’t have done it without the dealers.
But, as the article points out, it’s not just ANY dealers that will help provide success for the manufacturer.
The researchers found that the STRENGTH of that local retailer’s brand is also a critical piece of the puzzle. The stronger the Retail Banner’s Brand Equity (RBBE), the more success they experience and the higher margin they can command. If a retailer/dealer in a local market has a weak reputation or “brand,” the article states that promotions and more competitive pricing are necessary. Probably not the preference for most manufacturers.