Another option for new enterprises product marketing --- intensive distribution
"Well, let's discuss intensive distribution." The professor raised the voice.
"In the intensive distribution method, everyone who wants to distribute your products is encouraged. Its goal is to let your product reach the end consumers to reach or may buy all the places of your products. Emongged consumer goods such as candy, Dessert, etc., as well as fashion products, generally suitable for intensive distribution. Please see the case below! "
Case 2: Lightning marketing, "wallwalkers" intensive distribution
Kenhakuta is a master using intensive distribution. In the 1980s, while using the smart and creative marketing plan, he used intensive distribution to provide support for the launch of "weird walls". Because he took the "lightning" method to built a national public relations network, he promoted the surprising demand, and every store in the United States wanted to sell the weird wall.
The quirky wall is like a name, which is some small octopus made with plastic. If they throw them on the wall, they will press another leg to walk down the wall. After knowing this is "the latest fashion" from the CBS evening news, each retailer wants to sell the wall upstream.
Ken know that time is the most important, he should take advantage of this super-consumption demand, let as many stores as possible in the fastest time. He knows, although he has a Japanese manufacturer's "exclusive license", but the competition of cheap price reductions will come quickly. In order to complete large-scale distribution as soon as possible, it is committed to selling products to retailers as soon as possible, selling products to retailers, rather than using its own sales force and distribution team. The distributor launches the entire distribution system and quickly serves the product to be eager to be part of the lack of action. It is willing to give these distributors an additional bonus as they constitute a part of the distribution chain. In this way, the profit he obtained in each wall is reduced by using its own sales force and distribution system. However, he correctly estimates that the total amount of products that use this indirect distribution system is much higher. He sold more than 200 million walls in less than a year, and the profit from profitability is much better than trying to form and use its own sales force and distribution system. Not only that, but he has to make full use of huge consumer demand before the price of a major impact.
The power of the case is huge, an appropriate case, giving the revelation may exceed the reason of the macro.
After reading this story, someone immediately made a comment.
"I see this story to our maximum harvest is that the product life cycle of the 'wall top' is limited, so there is no way to take the same product sales in the same mass market consumers. If he It is planned to carry out long-term business, then the retailer relationship has become important, and it may be reasonable to sign a more direct contract between the company and the mass retailer. He puts the wall as a thousand chances of chance, it is very correct. The wall behavior brought the 'tens of thousands of dollars' profits' - this is a good result, not to have a year of work, and there is basically no asset in the beginning. "
Figure new and stable, balance management of distribution channels
"The previous discussion is just a static analysis of distribution channels. As an entrepreneur, an innovative map, it should also be considered. If distribution channels have changed over time, it may be more valuable. "Professor always grasps the main line of entrepreneurship. "Especially for sustained innovation, changing products or introduction of new products, this is more. For example, over time, according to product changes, the distribution channel is often an excellent strategy. If you It is likely to create one of you and distribution of distribution channels with high reputation products with high reputation distribution channels to high reputation products with higher reputation (usually profitable spaces). The channel is a win-win situation. "
"The distribution channels that change the product will have a good effect with time, which has a certain relationship with the needs of different types of channel members. High-end channel members, they want to sell products with exclusive, cognitive value. They are unwilling to have a low-level, low-profit retailer's prices in the same product on the same product. High-end stores believe that they have better service and shopping environment, his price should be higher than the mass market competitors "The needs of the low-grade channel members are completely opposite, and the same goods can be sold with high-level stores are what they have to see. They want to tell you, they have the same thing as high-end stores, and the price is lower. In this case, manage the huge system consisting of different channels, and maintain subtle balance, which is a real challenge for many entrepreneurs.
"Maybe failure can teach us more. Before the course, let's look at an example --- New Enterprise Super-Scope, which is failed in the distribution channel balance management."
Case 3: Shortelight SUPERSCOPE - unavailable target
In the late 1980s, Super-Scope purchased the right to use the MARANTZ tag on high-fidelity components. When SuPerscope is purchased, MARANTZ is the first manufacturer of high-quality audio components. MARANTZ's distribution consistent with its high-level image. They have a very selective distribution channel - only choose the most prestigious and best audio "consultant" / wholesalers in major cities in the United States. Marantz's business profits are high, but sales are not very large.
Marantz's market positioning and pricing strategies will focus on high-income audio material marks. Based on this limited and high-profit margin, Marantz grows together with a high-level audio market, and the profit margin is around 10%.
SuperScope is not satisfied with the growth potential of MARANTZ. They inference, the name of the brand is so high, if further expanding distribution, increase the advertising budget, will greatly increase sales. When Super-Scope is discussed with the mass market retailer and distributors, they are willing to buy and sell MARANTZ series products. Retailers such as Wal-Mart, Kamart or Circuit Requires for sales of high quality, high -brusstore rates. Their approach is to discount the price list and greatly increase the number of sales. They have lost money to sell Marantz for attracting customers. They inference, the middle market consumers will use this opportunity to buy high-level products at a very low price.
So, SuperScope began to implement an ambitious plan, quickly improve the sales of MARANTZ products through large-scale expansion channels. They began to provide products to retailers in the publication market. They encourage these retailers to adopt a tofu-grade advertising approach, a big MARANTZ product advertisement in a weekly flyer and newspaper clamps. Many retailers such as CircuitCity or Keemat also contain temporary price and other special discounts. At first, the sales effect of distribution expansion plans is very obvious. In the next two years, SUPERSCOPE's MARANTZ product sales have doubled, due to scale economic effects, the company's total profit growth increases. In about a year or so, Superscope turns into a very hot stock of New York.
After that, things became chaotic. High-level exclusive retailers are very surprised to the prices competition and excessive publicity of mass retailers. High-level customers are very excited, they are willing to go to Kaimurt's less money to buy products that need to be purchased in high-level monolyers. So high-level retailers have no business. What do they do? These high-level monologizers began to refuse to sell Marantz products, and reveal the sound equipment manufacturers of high-level monopoly channels that will only grant selective distribution rights only to high-level monopoly channels that do not have price competition. At first, SuperScope does not miss these distribution channels, because huge orders from mass retailers can make up for the loss of high-level enterprises. However, once most high-level retailers stop selling Marantz products, its prestige and reputation began to be harmful. High-level retailers have begun to destroy Manrantz products, saying it into a "cheap brand" sold by the store like Kaimat. Volkswagen is no longer happy to accept the higher wholesale price of Marantz products because the product is no longer as bestsed in their store. This wholesale price pressure has brought great impact on Superscope's profit margin. So, SuperScope decided to make MARANTZ products overseas with low cost and lower quality to increase profits. This change in production is maintained at the level of superscope, but also provides more words for high-level "hit MARANTZ", and they have created more rumors for the decline in Marantz product quality. Publicization market retailers have begun to reduce orders because the situation of MARANTZ products is increasingly deteriorated. SUPERSCOPE's sales suddenly dropped. They tried to introduce a "gold medal" MARANTZ product, produced in China and only sold in a high-level store. The high-level store has declined the idea of SuperScope, because they feel that the company betrayed them on the Marantz product issue. They don't want to trust Superscope, do not want to repeat the mistakes of Marantz other products on gold medal. Super-Scope has become cold, and the name of Marantz has lost most of the value. Professise Review: SuperScope has made several errors. They did not create long-term value for their distribution and retail channels. When they expand distribution, when they become a price competitor, they used some of the reputation of the high-level retailer's Marantz, which contracted these high-level retailers. They did not give high-level retailers, they should have exclusive distribution rights, and lost their trust in these high-level retailers. They also reduce the quality of the brand while reducing prices. They sacrificed long-term market positioning and cognitive value for huge short-term income and profits. Their short scales killed the company.
