Reflections:
- Channel refinement, meticulous cultivation, and deep distribution have become synonymous with many companies' marketing systems. But does 'refinement' guarantee 'meticulous results'?
- Is refinement forever? Should channels continue to be weakened? Must all orders be taken by the company?
- Execution is the basic guarantee system of enterprise management, but what is true execution?
- Customer relationship is a form of interpersonal relationship and a soft indicator for enterprise management. In marketing system assessments, indicators like sales volume, expenses, distribution rate, and vibrant displays can be quantified. However, for soft indicators like customer relationship, companies often feel at a loss. How can 'customer relationship management' be systematically addressed?
Currently, more FMCG companies are adopting deep distribution. Those implementing channel refinement face high costs with tens of thousands of terminals and hundreds of sales reps. Route visits are the foundation of channel refinement, but the phenomenon of 'cultivating but not refining' often occurs. Many attribute this to flawed assessment systems or execution issues. While strengthening execution is a good approach, execution must be based on a clear 'marching route'; otherwise, it leads to 'incompetent generals exhausting the troops.' The premise of execution is 'knowing how to execute.' Moreover, overemphasizing execution through assessment alone, like a landlord's whip, can lead to passive resistance or even rebellion.
This article systematically describes how to solve the 'cultivating but not refining' problem:
In actual market operations, when entering a market, companies typically use the following approaches:
- Strong brands often leverage company advertising support and channel power for concentrated distribution. After rapidly increasing distribution rates, they deploy route personnel for consolidation visits.
- Weak brands without advertising support typically deploy route personnel for penetration visits, relying on channel support.
Thus, terminal visits become a daily routine for sales reps. However, despite management tools like morning meetings, form work, indicator checks, and performance assessments, many reps face dozens of stores on their route manuals and feel lost before departure. They don't know the theme or purpose of the day's visits. Many reps go through the motions, even falsifying records, like a drive shaft without power, spinning without function—'cultivating but not refining'!
This is especially common in 'penetration markets' with newly developed areas, manifesting as:
1. Low efficiency. With hundreds of blank terminals in a region, reps face constant rejections, feeling helpless despite increasing assessment pressure.
2. Boredom and frustration. With weekly visit cycles, reps repeatedly face the same terminals, performing monotonous tasks like stocking, displaying, posting, and negotiating. Over time, many lose passion, and their performance and confidence suffer.
3. Cat-and-mouse games. To cope with inspections, reps develop skills in hiding, counter-surveillance, and even falsifying forms, orders, and numbers.
4. False prosperity. Some branches show strict morning meetings, loud slogans, neat forms, and impressive data, appearing well-managed. But on the ground, competitors thrive, falsification is rampant, and even distribution rates are fake—a clear 'vanity project' tendency.
5. Cost overruns. Companies implementing channel refinement often separate promotion from sales, with terminal promotions executed by the company. Some branches invest year after year without market results, failing to become category leaders.
6. Going it alone. Branches fail to cooperate with distributors, lacking full support during promotions. After promotions, complaints pile up—unredeemed promotions or delivery failures. Companies and distributors blame each other, escalating conflicts until the company faces a new opponent: the distributor!
7. Master works, servant rests. As companies refine channels, they weaken distributor functions, turning them into 'delivery agents' overly dependent on orders, trapping the company in an 'order quagmire.'
Over time, as performance declines, reps become disenchanted and leave, and companies blame their quality, leading to high turnover and constant firefighting.
Recently, I encountered a case: a liquor company that had implemented deep distribution for nearly two years faced the above troubles in a regional market:
1. In penetration visits, some growth markets showed 'cultivating but not refining, blooming but not bearing fruit' (as the company president put it).
2. The company strengthened checks and execution, increased rewards and penalties, but overall results were poor.
3. There was significant turnover, including key trained business personnel.
4. Some regional distributors began reducing their own sales staff, keeping only delivery personnel, almost entirely dependent on company orders.
Although the branch office meticulously broke down and assessed distribution rates, much was about data rewards and penalties, with little business guidance or terminal policy follow-up—'refinement' without 'meticulous work.' After multiple visit cycles, reps showed 'customer relationship misalignment or gaps':
During joint visits, reps had good rapport with some blank store staff, joking and using nicknames.
Checks revealed that while bar staff knew the route rep, hotel owners couldn't name the rep or even describe them. Many blank store owners didn't know product prices, promotions, or ordering channels.
Reps visited blank stores without knowing the purpose, often just to complete visits. Some even did 'one-minute visits'—stopping at the door or circling around.
Reps were unfamiliar with complaint procedures and distributor delivery standards, unsure how to handle issues.
Route forms didn't specify key visit targets for each store.
Additionally, branch daily market management had issues:
No basic channel planning concept, only emphasizing 'store count' or 'distribution rate,' leading to new product launches concentrated in small restaurants or micro-supermarkets, with distribution targets relying on individual rep abilities.
Promotions were parallel across all channels, with similar policies for foodservice and circulation.
In these reps' routes, distribution rates sometimes stagnated. Some 'fortress' stores remained unconquered after dozens of visits. Some routes showed better data than others, with uneven performance and a clear 'star performer' phenomenon.
Through joint visits on multiple market routes, repeated communication with frontline staff, and detailed review of route visit manuals, the following issues were identified:
Terminal management lacked detail; distribution rate is an important assessment tool but not the only one.
Terminal customer relationship was not included in assessments, leaving visits in a 'star performer' state (those with good basic skills perform well; others don't). This manifested as:
- Customer relationship formation was left to individual discretion without clear standards.
- After forming relationships, there were no detailed progression standards, so distribution didn't translate into maximum single-store output. Despite basic vibrant displays, some stores had distribution but no sales.
- Although the route management module included customer relationship descriptions, they were mostly in skill training, not basic assessments.
Route visits are the basic module of deep distribution, with route personnel carrying out customer management, order (or lead) transmission, stocking, display, POP, inventory management, and promotion execution. They are the closest link to the market, dealing with terminals daily. Without 'customer relationship' as a guarantee, route visits lose effectiveness.
However, customer relationship, as an interpersonal relationship, is a 'soft indicator' that cannot be easily measured or assessed. The company raised this 'question.'
In response, we improved the route visit management module from the perspective of 'customer relationship progression,' building on the existing foundation:
I. Terminal Classification Management:
Although the company had its own classification standards, it didn't truly understand the purpose, executing uniformly without real application.
1. Terminal Categorization.
For hotels, using A, B, C standards: A stores are major influential terminals in the region. Excluding A stores, those with five or more private rooms are B stores; the rest are C stores. Overall, AB stores account for over 40% of all terminals.
Only with accurate classification can appropriate promotions be designed, like tailoring clothes or cooking according to ingredients. A reasonable 'promotion menu' includes:
A. Small threshold order and distribution policy B. Secondary order and distribution policy C. Mixed venue agreement sales promotion policy D. Exclusive venue promotion policy E. Model store promotion policy
To prevent uncontrolled promotion spending, combine classification with phased allocation of the 'promotion menu' proportionally to each store. For example, in a certain period, the 'exclusive venue' ratio target for B stores in a local market is 20%; below target is penalized, above requires regional manager approval. This forces local supervisors to plan their markets meticulously, solving the problem of year-after-year investment without results.
To address the drawbacks of full-channel 'flooding' and 'overextended fronts' in promotion design, with reasonable market planning, make these improvements:
A. Single-store breakthrough, personalized progression, abandoning parallel advancement, focusing market resources. B. Concentrated promotions, key point breakthroughs, establishing key terminal profiles and development plans with clear deadlines, included in assessments, to form a top-down pressure in local markets.
2. Terminal Grading.
Divide terminals into five levels:
- Target stores: planned blank stores for development.
- Distribution stores: terminals with initial stock.
- Active stores: mixed venue terminals with normal product flow.
- Agreement stores: stores with quantitative mixed or exclusive agreements per the 'promotion menu.'
- Model stores: exclusive stores with local influence within a certain ratio.
Mark these in route manuals with detailed annotations and set phased goals for assessment. Clear goals and timelines make reps consciously plan their channels under assessment.
II. Key Person Identification and Customer Relationship Progression:
Key personnel: In C stores, often family-run, with the owner in the kitchen and the owner's wife at the bar. In AB stores, especially A stores, roles are more specialized, possibly including bar, warehouse, purchasing, and finance.
Some of these people have selection and decision power over product entry; others influence the flow speed after entry.
Based on terminal grading standards, align with route manuals to create customer relationship progression standards for reps, with single-store grading and morning meeting descriptions. Follow up with guidance and assessment. According to the role of 'key personnel' in different terminal types and the 'five-level management,' set assessment standards. For example, in a 'distribution' C store, assess whether the owner (or wife) knows the rep's name, distributor's rights, visit cycle, and product promotion information, guiding reps in customer communication. This helps reps understand how to form 'standard' customer relationships in single-store development.
III. Establish Effective Visit Standards.
While detailing terminal grading and customer relationship progression, add effective visit standards and phased goal assessments, emphasizing 'effectiveness.' Implement daily (weekly) visit plan management: morning meetings state the day's effective visit plan and yesterday's implementation; weekly plans and weekend summaries. Eliminate 'idle running' in visits, maximizing 'effective' components. Set a minimum of 20 effective visits per day (adjustable per market).
Given reps' high visit volumes (nearly 60 stores daily), try a 'skip store declaration' system: no longer requiring every store visit, but setting phased effective visit goals. When goals are met, reps can skip a proportion of planned stores, but must declare in advance at morning meetings.
IV. To stabilize terminal customer relationships, address 'complaints' and 'delivery' to remove worries. Detail complaint handling procedures, use 'rebates' to assess distributor delivery service standards, and set delivery service standards based on distributor vehicles and personnel, determining delivery areas and terminal counts—'cooking according to ingredients.' Avoid conflicts from unresolved complaints or delayed deliveries.
V. Change distributor 'dependence' on orders, clarifying the 'lead generation' concept. The liquor industry differs from beverages; not all sales come from orders. In mature markets, route visits mainly serve to:
A. Push new products to target channels. B. Terminal stocking, display, vibrant presentation, promotion execution. C. Block competitors, manage market prices, promotions, and data monitoring.
In growth markets, route visits also focus on:
A. Lead generation: using channel power to guide distributors in product coverage. B. 80/20 layout: not all terminals need visits; otherwise, labor costs are unsustainable. C. Knowing when to stop: the goal is to capture market high ground and 'rule-making power,' aiming to become the regional leader. Full-area or full-channel visits are risky! D. Preventing 'master works, servant rests': overemphasizing orders and weakening channels burdens the company.
Through a series of module modifications and fine-tuning, with customer relationship management as the entry point, the aim is to build 'clear' execution.
Terminal customer relationship is the foundation of route visits. On the surface, 'customer relationship' management is 'doable' but not 'speakable' or 'assessable.' However, visits without 'customer relationship' are ineffective. In market refinement, companies invest heavily in labor; if reps can't form 'effective customer relationships' with terminals quickly, this investment yields little, and competitiveness weakens. By focusing on 'customer relationship management' and improving modules, the 'soft indicator' becomes tangible and assessable. For example, in target stores, if after three or more visit cycles, 'key personnel' still don't know the product's entry price or promotion policies, points are deducted.
Thus, a clear market 'sand table' emerges, with the main theme of breaking through via 'customer relationship management,' not just improving skills but clearly marking a 'marching route'—knowing whether to 'turn left or right.' It also clarifies that the purpose is to 'guide' distributors to participate more finely, not for the company to take over distributor functions. The 'cultivating but not refining' problem is solved!
Route visits are like an assembly line in the marketing system. Individual 'gold medal' reps or 'star' reps, or even large distributors, can't solve the line's efficiency. To maximize efficiency, companies must start holistically, ensuring system optimization and synchronized development of all links. Rep management can't rely on 'single combat'; reps must understand their work direction, with training as the banner and assessment as the yardstick. This assembly line needs continuous maintenance, improvement, and timely upgrades. Only then can route visits yield maximum benefits.
In market management, only by going deep into the front line, starting from the market's smallest details, can effective results be obtained. Macro management, micro entry, step by step, down-to-earth market work—only then can a company build true execution and competitiveness!
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