---
title: "Beware! These Misconceptions You May Have When Building a Model Market"
description: "In the FMCG industry, the concept of a model market is familiar to many. Many brands have achieved success by building model markets step by step. However, many manufacturers and distributors still take detours, wasting resources and demoralizing sales teams. Based on his experience, the author lists ten common misconceptions in building model markets and offers solutions."
author: "邢仁宝"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2020-07-03"
language: "en"
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# Beware! These Misconceptions You May Have When Building a Model Market

> In the FMCG industry, the concept of a model market is familiar to many. Many brands have achieved success by building model markets step by step. However, many manufacturers and distributors still take detours, wasting resources and demoralizing sales teams. Based on his experience, the author lists ten common misconceptions in building model markets and offers solutions.

In the FMCG industry, the concept of a model market is familiar to many. **Many brands have achieved success by building model markets step by step, gradually capturing the market.**
However, many manufacturers and distributors still take detours in building model markets, failing to achieve the desired results. This not only consumes human, financial, and material resources but also severely undermines the confidence of the sales team, making brand development even more challenging.
Therefore, based on my experience, I have listed ten common misconceptions in building model markets and corresponding solutions, hoping to provide some inspiration.

**-01-**
**Misconception 1: Loud Slogans, Only for Show**
Phrases like "This year, we will focus on building 200 model markets and 1,000 model stores, achieving doubled sales by year-end..." are often seen in corporate reports, stirring excitement.
Before the project even starts, slogans are shouted. It's not wrong to boost enthusiasm, but have these slogans been carefully considered? Are these numbers decided on a whim, just to please the boss?
**Consistency between words and actions is a basic quality of leaders. Once a slogan is announced, there must be precise and detailed implementation plans and step-by-step operational measures.**
Therefore, **the primary condition for a successful project launch is that the leadership must take it seriously, with a strong desire to drive performance growth through model market building, and reach a consensus with core sales personnel.** Only then can the whole team be aligned and form the greatest synergy.

**-02-**
**Misconception 2: Blind Regional Selection, Only Targeting Developed Areas**
The first choice for a model market is usually economically developed regions, but are such regions suitable for your product?
Wahaha avoided urban competition and chose a "rural encircle cities" strategy; Red Bull's core model markets are mostly in less developed areas, yet they have achieved excellent results.
Economically developed areas are inevitably more competitive, making it harder to break through and establish a position, and requiring higher costs.
Therefore, **you should find the most suitable region for yourself, like matchmaking: first understand your own situation clearly, then set standards for the other party based on that, so the probability of getting together is higher.**
Per capita consumption (product sales / market population) is an important indicator of regional market sales potential, which can preliminarily judge market development potential.
After determining market potential, combine it with product positioning and pricing to analyze whether these potential markets have enough consumers, whether their consumption habits match the product's efficacy, whether the brand appeal resonates with their values, and the level of competition in that market.
Of course, these dimensions cannot be quantified, so you can have the frontline sales teams in each market conduct a round of research, design questionnaires (as below), and then analyze and compare, combined with your own strengths, to select the most suitable model market.

**-03-**
**Misconception 3: Disorganized Project Planning, Rushing for Results**
**Project implementation is not achieved overnight; it requires phased and step-by-step planning.**
In reality, many sales managers throw the number of markets to build and sales targets to the relevant offices without follow-up. When they go on business trips and see results that don't match their expectations, they fly into a rage and criticize the sales team for lack of execution.
Project management should be complete and thoughtful; **results should be broken down by stages and steps.** For example, project implementation can be divided into five stages, as shown in the table below. The goals for each stage should be listed, along with completion times and responsible persons.
With a detailed plan, project leaders can be better prepared, requiring each department to further refine their work and list specific requirements down to daily tasks.
For instance, during the market research stage, design research forms, obtain administrative division maps, divide the map into smaller sections along main urban roads, and have investigators follow the right-hand rule to conduct a sweep-style survey of all terminal outlets within each small section without missing any.
Then, complete computer entry of survey data daily, and conduct random checks of survey data the next day. **Each step should have relevant training materials to guide project members in completing work efficiently and professionally.**

**-04-**
**Misconception 4: Haphazard Team Assembly, Poor Execution Enthusiasm**
Building a model market is a time-consuming and labor-intensive project, and its implementation will inevitably affect the normal sales rhythm of related markets. However, the importance of selecting the right people must be emphasized. You cannot put people with poor business skills or bad attitudes into the project just to ensure sales volume or other core work.
Years ago, when I participated in Coca-Cola's model market building, each office was required to send core business backbone to the project team. As a result, many people who had poor relationships with leaders or lacked ability were placed in the project team. From the start, there were various disharmonies, buck-passing, and picking and choosing, greatly reducing the project's effectiveness.
**At any time, to achieve twice the result with half the effort, you need "the right people" and "the right use of people." For a project to truly succeed, you also need a cohesive wolf-like team** to **make strategy execution even more powerful.**
**In addition, establish an execution culture within the project team, emphasizing execution, patience and meticulousness, and collective wisdom. Also, provide phased incentives and set team role models.**
Fully stimulate each member's potential, use their strengths, and compensate for their weaknesses, allowing everyone to grow. More importantly, through this process, you can cultivate a group of reserve leaders with integrity and capability for the company.

**-05-**
**Misconception 5: Unclear Standards, Unattainable Goals**
**With direction and team in place, the next step is to have clear goals, and they must be quantifiable.**
For example, for the first round of product distribution, what should be achieved at terminals in different channels? What position on the shelf? How many facings? What kind of promotional materials should be used, and how should they be placed? For the second round, how much expansion over the first round? What should be achieved compared to competitors? How many layers for in-store stacking displays? Take Coca-Cola as an example; it's best to provide clear guidelines like the image below.
At the same time, there should be detailed channel promotion plans, comparing competitor strength, setting several tiers of terminal purchase packages; what fee ratio for purchasing core store display positions, etc.
These **standards are crucial during the market activation phase and should be determined in advance and given to the execution team, allowing them to continuously summarize and optimize during implementation to form the best plan for the local market.**

**-06-**
**Misconception 6: Throwing Money at the Market Without Thought**
Purchase promotions, distribution gifts, and display position grabbing all require money. During this process, you must consider a measure. Spending money blindly without prioritizing or distinguishing between urgent and non-urgent matters may lead to a flash in the pan. Local terminal customers may think you are foolish with money, spend it all, and once the expenses stop, the product will gradually be forgotten.
When allocating expenses, choose benchmark stores on each street: those with the highest foot traffic, best reputation, and most extensive product range should be invested in first.
Focus investment on in-store end caps or checkout counter stacking displays, allowing the product to benefit from the terminal's traffic and achieve higher sell-through. Then use distribution data to influence surrounding stores; terminals will not refuse products that sell well.
**Expense allocation should be differentiated. In-store investment should not be comprehensive but should insight into consumer purchasing habits, seize core positions, and use cost-effective small gifts to build terminal relationships.**
During product distribution, avoid heavy pressure to stock up. Maintain the stability of the product price system, let terminals feel the product's sell-through, and ideally form a weekly restocking pattern. Secondly, in the model market, first build several model stores, then model lines, and finally form a model market.

**-07-**
**Misconception 7: Lack of Top-Down and Bottom-Up Alignment, Inability to Form Synergy**
**Lack of top-down and bottom-up alignment means the project does not form a push-pull synergy from distributor to terminal. If the original distributor in the market provides services, the entire project process must have them arrange dedicated personnel to participate throughout.**
Generally, distributors are more familiar with the local market than our sales staff, have deeper social resources, and may have stronger ties with some terminals. Many stores we cannot crack, they can secure with one word.
From the perspective of vested interests, distributors are also happy for their market to become a model market, become the company's focus, and receive more resources.
All our plans and details should be discussed with the distributor. When our resources are limited, we also need to let the distributor sacrifice some gross profit, provide people, vehicles, and money, and give maximum support to the project.
This process is also a stage to observe whether the current customer matches the model market. If they cannot participate actively and cooperate, be sure to find backup customers in time.
During the research phase, we should identify influential distributors in the area and let them know our ideas. If any of these customers share our thoughts, have innovative ideas, and a pragmatic spirit, we should maintain contact.
**Remember, the distributor's role is crucial to the success or failure of a market. A sedentary distributor who is conservative and unambitious cannot build a model market.**

**-08-**
**Misconception 8: Lack of Three-in-One Integration, Insignificant Results**
Nowadays, everyone talks about the trinity. Consumer shopping habits have shifted from offline to online and community, representing a transformation of consumer purchase scenarios. Products must meet consumption demands in various scenarios to enter consumers' minds faster and more deeply.
Therefore, during the research phase, we should increase observation and understanding of consumer behavior habits. The success of a model market is not about pushing more products into the market but about higher consumer demand and being the first choice in the category.
So **in building a model market, we cannot focus only on offline terminals; we must also have product promotion online, such as Douyin live streaming and platform partnerships.**
In community stores where consumers live, and in community groups, we should also see the product, with phased consumer experience activities like flash sales, red envelope grabs for experience coupons, group-buying surprise prices, etc. Don't pursue large sales volume, but try to attract as many eyeballs as possible and create a hot-selling scene.
During key periods of project advancement, offering free samples in modern trade channels or holding brand roadshows with consumer interaction is also essential.

**-09-**
**Misconception 9: Copying Without Considering the Path, Expansion Will Fail**
After completing the phased tasks of the model market, most core outlets have established good relationships, have quality product displays, clarified the manpower and resources needed for the current stage, and established daily work standards for sales staff and distributor partners.
Then you can enter the tracking and optimization period, continuously optimizing business behaviors, conducting channel promotions at appropriate times, and gradually improving the distributor's distribution level and service capability.
At this point, can you replicate this building method and have more model markets spring up? The answer is no. Each market has its own characteristics and cannot be directly copied. For example, if a model market has made a highlight in the internet cafe channel, should you make the same investment in internet cafes in the new model market and stubbornly focus on that channel?
We need to carefully consider the conditions behind each success story. The living habits of the consumer population determine the local business development. If the new target market has logistics parks or industrial zones, then focusing on these closed channels will be our key building areas.
When summarizing experience, we should deeply analyze the conditions of gains and losses. Was the success due to catering to local consumption habits, or was it caused by a specific measure in the project? Was the failure due to people, process design, or the choice of model market?
**When promoting model markets later, we should selectively replicate based on the actual situation of each market to avoid wasting resources and energy.**

**-10-**
**Misconception 10: Stop and Go, How Can a Spark Start a Prairie Fire?**
**Building a model market is a process of continuously tapping into potential market sales. The biggest taboo is starting with great fanfare and then fizzling out.** Without sustained attention to the market, relatively focused investment in core outlets, timely replacement of unsuitable distributors, timely adjustment of unsuitable sales staff, and ignoring strong competitor follow-up, the project will fail.
Especially when leaders face sales pressure, they start to focus on sales volume, pushing inventory everywhere, prioritizing big customers, and forgetting all about model markets. The result is that the hard-built model markets and trained project elites become fleeting clouds.
After the inventory-pushing wave passes, the topic of model markets is brought up again. Repeating this cycle, how can a project focused on the company's future growth achieve results? How can a spark start a prairie fire?
I remember Shi Yuzhu once said in the first season of "Win in China": **Model markets cannot be rushed; national markets cannot be delayed.**
**The business world is like a battlefield. Quickly capturing the market and seizing the high ground is the ultimate goal of every enterprise. Careful building, precise replication, efficiency priority, and persistence are the only ways for model markets to spread like a prairie fire.**


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