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Reflections:
- Channel intensive cultivation, meticulous work, deep distribution... these have become synonymous with many companies' marketing systems. But does 'intensive cultivation' guarantee 'meticulous work'?
- Is intensive cultivation 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 relationships are a form of interpersonal relations, a soft indicator for enterprise management. In marketing system assessments, indicators like sales volume, expenses, distribution rate, and visual merchandising can be quantified. But for soft indicators like customer relationships, companies often feel helpless. How can we systematically solve 'customer relationship management'?
Currently, more and more FMCG companies are introducing deep distribution. In companies implementing channel intensive cultivation, facing tens of thousands or hundreds of thousands of outlets and hundreds of sales reps, they bear high 'intensive cultivation' costs. Route visits are the foundation of channel intensive cultivation, but the phenomenon of 'cultivating but not refining' often occurs. Many attribute this to problems in the assessment system, i.e., execution issues. While strengthening execution is a good choice to solve 'cultivating but not refining' in route visits, execution must be based on a clear 'march route.' Execution without a clear route can lead to the tragedy of 'an incompetent general exhausting the entire army.' The premise of building execution is 'knowing how to execute.' Moreover, merely strengthening assessment and overemphasizing execution, like the execution under a landlord's whip, can lead to passive resistance, or even 'armed uprising' or 'overthrowing the landlord and dividing the land.'
This article systematically describes how to solve the 'cultivating but not refining' problem:
In actual market operations, taking market development as an example, companies typically adopt the following approaches when entering a market:
- Strong brands generally use the company's air support (advertising) combined with channel power to concentrate distribution. After rapidly increasing distribution rate, they deploy route personnel for consolidation visits.
- Weak brands, without advertising support, typically deploy route personnel to do penetration visits based on channel support.
Thus, terminal visits become a daily routine for sales reps. However, in actual terminal visits, despite management tools like morning meetings, form work, indicator checks, and performance assessments, some sales reps face dozens of stores on their daily route manual and are often at a loss before departure. They don't know the theme and purpose of the day's visits. Many sales reps, to complete the day's visits, perform routine, even perfunctory, and falsified work, like a drive shaft without power transmission, spinning without function—'cultivating but not refining'!
Especially in 'penetration markets,' when facing a newly developed market, the phenomenon of 'cultivating but not refining' is more likely to occur, mainly manifested in:
1. Low efficiency. In a region with hundreds of blank terminals, sales reps face constant 'closed doors' and setbacks, almost at a loss. Although they know the assessment pressure is increasing, they are often bewildered when facing the market in their area.
2. Boredom and frustration. Since visits typically follow a one-week cycle, sales reps repeatedly face the same fixed terminal customers, performing repetitive and boring actions like sorting, displaying, posting, negotiating... day after day, year after year. Many sales reps work without passion, performing routine tasks. Over time, not only does their performance fail to improve quickly, but their enthusiasm and confidence are also damaged.
3. Cat and mouse. In daily work, sales reps, to cope with inspections and complete work, often have 'hide-and-seek' and 'counter-espionage' skills against supervisors' checks, even falsifying forms, fake orders, and inflated numbers.
4. False prosperity. In some branches, morning meetings are strict, slogans are loud, forms are neat, and data looks good... On the surface, it seems management is strict and execution is in place. Supervisors are confident in following instructions and prepared for headquarters audits. But when going to the front line, you find competitors rampant, falsification widespread, and even distribution rates are fake. The tendency for 'vanity projects' is obvious.
5. Cost out of control. Companies implementing channel intensive cultivation typically use 'promotion separation,' where terminal promotions are usually executed by the company. In some branches, expenses are invested year after year, but the market shows no benefits, and they fail to become the leading brand in the region, being constrained by competitors.
6. Fighting alone. Branches and distributors cooperate poorly, and when executing promotional activities, they don't get full support from distributors. After promotions, customer complaints pile up, either promotions are not redeemed in time or delivery is not in place. The company and distributor blame each other, conflicts escalate, and over time, the company has to face a new opponent—the distributor!
7. Master works, servant rests. In the process of channel intensive cultivation, the manufacturer gradually weakens the distributor's functions, turning them into 'delivery providers' overly dependent on orders. The manufacturer gets stuck in the 'order' quagmire and cannot extricate itself.
If 'cultivating but not refining' persists, as performance declines, not only do sales reps become bored and leave, but the company may also blame the sales reps' quality, leading to a revolving door of frontline staff. The company can only 'rob Peter to pay Paul,' causing endless frustration!
Recently, I encountered a case in practice: a liquor company that had implemented a deep distribution system for nearly two years encountered the above 'troubles' in local market growth:
1. In penetration visits, some growth markets had the problem of 'cultivating but not refining, blooming but not bearing fruit' (as the company president put it).
2. The company made great efforts in strengthening checks and improving execution, increasing rewards and penalties, but the overall effect was not obvious.
3. There was a large turnover of personnel, including some key business backbone trained by the company.
4. In some regions, distributors began to reduce their own sales staff, retaining only delivery personnel, almost completely relying on company orders.
Although in daily management, the company's local offices made detailed breakdowns and assessments of distribution rates and other data, much of it was about rewards and penalties on data, with little business guidance or terminal policy follow-up. 'Intensive cultivation' could not achieve 'meticulous work.' Many sales reps, after multiple visit cycles, developed 'customer relationship misalignment or gaps,' mainly manifested in:
When accompanying sales reps on visits, I found that sales reps had good relationships with staff in some blank stores, joking around, even greeting each other by nicknames.
Checks revealed that in some terminals, while bar staff recognized the route sales rep, the restaurant owner couldn't name the rep, couldn't even describe their features, and many blank store owners didn't know the product's price, promotions, or ordering channels.
When visiting blank stores, sales reps didn't know the purpose of the visit before entering, mostly visiting just to complete the visit. Some even did a 'one-minute visit' by stopping at the door or walking around and leaving.
Sales reps were unfamiliar with terminal complaint procedures and distributor delivery standards, not knowing how to handle situations when 'complaints' or 'delivery' were not in place.
Route forms did not clearly specify the key visit targets for each store.
At the same time, in the daily market management of branches, several problems emerged:
There was no basic channel planning concept, only emphasizing 'number of stores opened' or 'distribution rate,' causing new product launches to focus on small and medium restaurants or micro-supermarkets, with distribution targets relying entirely on the individual abilities and qualities of sales reps.
Promotions were pushed uniformly across all channels, with basically the same policies for restaurants and circulation.
In these sales reps' routes, distribution rates often failed to improve effectively over time. Some 'fortress' stores had been visited dozens of times but still couldn't be conquered. Some route data was clearly better than other areas. Overall performance was uneven, with a clear 'star performer' phenomenon.
Through accompanying visits on multiple market routes, repeated communication with frontline staff, and detailed review of route visit manuals, the following issues were identified:
First, terminal management was not detailed; distribution rate is an important assessment tool for market development but not the only one.
Second, terminal customer relationships were not included in assessments, leaving sales rep visits in a 'star performer' state (those with good basic qualities perform well, others poorly). Mainly manifested in:
Terminal customer relationship formation was left to free play, without accurate management standards.
After customer relationships were formed, there were no detailed advancement standards, so after achieving distribution rate, maximum output per store couldn't be realized. Although some basic visual merchandising was followed up, some terminals had distribution but no sales.
Although the company's route management module included customer relationship descriptions, it was basically part of skills training, not included in basic assessments.
Route visits are the basic module of deep distribution. Route personnel carry out basic functions like customer management, order (or lead) transmission, sorting, display, POP, inventory management, and promotion execution. They are the closest link between the company and the market, dealing with terminals daily. Without 'customer relationships' as a guarantee, the effectiveness of route visits will gradually diminish.
However, customer relationships, as a form of interpersonal relations, are a 'soft indicator' that cannot be normally measured or assessed. The company raised this 'question.'
In response to this question, starting from the angle of 'customer relationship advancement' in the company's route visit management module, and relying on the existing route visit management foundation, the following module improvements are proposed:
I. Terminal Classification Management:
Although the company has its own classification standards, it hasn't truly understood the purpose of classification. Execution follows the company's unified standards, just marking on the route manual, and that's it.
1. Terminal Classification.
Taking restaurants as an example, generally classify terminals by grade according to A, B, C standards. In county-level markets, A stores are terminals with significant influence in the region. Excluding A stores, terminals with five or more private rooms are B stores, and the rest are C stores. Overall, AB stores account for more than 40% of all terminals in the region.
Only after accurate classification management of terminals can appropriate promotion methods be adopted based on terminal category, tailoring to the specific situation, and designing a reasonable terminal 'promotion menu,' which includes:
A. Small threshold order induction and distribution policy B. Secondary order induction and distribution policy C. Mixed venue agreement sales promotion policy D. Exclusive venue promotion policy E. Model store promotion policy
At the same time, to prevent uncontrolled investment in promotions, combined with terminal classification, periodically subdivide the 'promotion menu' proportionally to each store. For example, in a certain period, the target proportion of 'exclusive venues' for B stores in a local market is 20%. If the proportion is not reached, penalties apply; if exceeded, application must be made to the regional manager. By detailing the promotion menu, forcing the local supervisor to automatically make detailed plans for the market area. This solves the problem of investing year after year in promotions but only blooming without bearing fruit.
In response to the drawbacks of 'flooding all channels' and 'overextended battle lines' in promotion design, based on reasonable market planning, the following improvements are made:
A. Single store breakthrough, personalized advancement, abandoning parallel advancement, focusing market resources.
B. Concentrated promotions, focusing on breaking through market high ground, formulating basic data and development plans for key terminals, specifying completion times, including in assessments, urging completion, striving to form a top-down pressure situation in local markets.
2. Terminal Grading.
Divide terminals into 5 levels for management.
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 venue agreements signed according to the 'promotion menu.' Model stores: exclusive venue stores with local influence formed within a certain proportion in the region.
According to the above standards, make detailed classification marks on the route manual and conduct phased target advancement assessment management. Clarify advancement targets and timelines, making sales reps consciously conduct 'channel planning' for their areas under assessment.
II. Key Person Identification and Customer Relationship Advancement:
Key personnel: In C-type stores, mostly family-run, the owner is usually in the kitchen, and the owner's wife at the bar. In AB stores, division of labor is more detailed, especially in A stores, possibly down to bar, warehouse, purchasing, finance, etc.
Some of these personnel have the right to choose and decide on product entry, while others have the right to decide and influence the flow speed after entry.
According to terminal classification management standards, corresponding to the route manual, formulate terminal customer relationship advancement standards for sales reps, with single-store classification marks and standard customer relationship advancement descriptions in morning meetings, while following up with guidance and assessment. Based on the phased role of 'key personnel' in different terminal categories and the 'five-level management,' formulate corresponding assessment standards. For example, in 'distribution' C stores, assess whether the owner (or wife) knows the sales rep's name, the distributor's distribution rights, visit cycle, etc., and their understanding of product promotion notifications, guiding sales reps in customer relationship communication with terminals. Let sales reps understand how to form 'standard' customer relationships with terminals in phases during single-store development management.
III. Formulate Effective Visit Standards.
While detailing terminal classification management and customer relationship advancement management, add effective visit standards and phased target assessments, emphasizing the 'effectiveness' of visits. Implement daily (weekly) visit plan management, with daily morning meetings stating the day's effective visit plan and the implementation of yesterday's effective visits. Weekly effective visit plans are formulated, with weekend summaries. Effectively eliminate the 'idle running' phenomenon in visits, maximizing the 'effective' component of route visits. Specify that the minimum number of 'effective visits' per day is not less than 20 stores (adjustable for specific markets).
In response to the excessive visit volume of nearly 60 stores per day for sales reps, try a 'skip store declaration' system, i.e., no longer implementing the policy of visiting every store. Set phased effective visit achievement targets. When sales reps achieve targets, they can skip stores within the plan proportionally, but need to submit a written declaration in advance at the morning meeting.
IV. To achieve the stability of sales reps' terminal customer relationships, from the two angles of 'customer complaints' and 'delivery,' solve the worries behind route visits. Detail the 'customer complaint' handling procedures, use 'rebates' to assess distributor delivery service standards, and formulate distributor delivery service standards. Based on the distributor's vehicles and personnel, determine delivery areas and terminal numbers, doing things according to capabilities. Avoid terminal conflicts caused by untimely handling of 'customer complaints' and untimely delivery by distributors.
V. Change distributors' long-term 'dependence' on orders, clarify the concept of 'order induction.' The liquor industry differs from the beverage industry; not all sales must come from orders. In mature markets, the role of route visits is mainly:
A. Promoting new products to target channels. B. Terminal sorting, display, visual merchandising, promotion execution. C. Blocking competitors, market price, promotion management, data monitoring, etc.
In growth markets, while route visits undertake the above functions, the focus is on:
A. Order induction: using channel power to guide distributors in product coverage. B. 80/20 layout: not all terminals need to be visited; otherwise, the company's labor costs cannot be amortized. C. Knowing when to stop: the purpose of route visits is to seize market high ground and 'rule-making power,' aiming to become the leading brand in the region. The risk of visiting the entire region or all channels is high! D. The company should prevent 'master works, servant rests.' If the company overemphasizes orders and overly weakens channels, the company's 'burden' will become heavier and heavier.
Through a series of module modifications and fine-tuning, with customer relationship management as the entry point, the aim is to build 'clear and transparent' execution.
Terminal customer relationships, as the foundation of route visits, from the surface, 'customer relationship' management is 'doable' but not 'sayable,' and even less 'assessable.' However, visits without 'customer relationships' are ineffective visits. In market intensive cultivation, the company invests heavily in human costs. If sales reps cannot quickly form 'effective customer relationships' with terminals, the company's investment in this area will be greatly discounted, and reflected in the market, competitiveness cannot be strengthened. Centering on the main line of 'customer relationship management,' through a series of module improvements, the 'soft indicator' has a concrete manifestation and forms a specific assessment system. For example, in target stores, if after more than 3 visit cycles, the 'key personnel' still don't know the product's entry price, promotion policies, etc., then corresponding deduction points are applied.
Thus, a clear market 'sand table' is laid out, with the main purpose of using 'customer relationship management' as a breakthrough, so that sales rep visits don't just stay at the level of skill improvement, but clearly delineate a 'march route' for them, letting them understand whether to 'turn left or right' during visits. At the same time, clarify that the purpose of visits is to 'guide' distributors to participate more finely in the market, not for the company to take over distributor functions excessively. The problem of 'cultivating but not refining' is solved!
Route visits in a company's marketing system are like an assembly line. Individual 'gold medal' sales reps or 'star' sales reps, or even some powerful distributors, cannot solve the efficiency of the entire assembly line. To leverage the efficiency of this 'assembly line,' the company should start from the whole, ensuring system optimization while clarifying the synchronized development of each link in the system. For sales rep management, don't rely on 'single soldier combat.' Let sales reps understand their work direction while following up with training and assessment, using training as the banner of action and assessment as the yardstick of action. At the same time, this assembly line needs continuous maintenance and improvement, and timely upgrades. Only then can route visits maximize their benefits.
In market management, only by going deep into the front line and starting from the market's most peripheral points can you get effective things. Macro management, micro entry, bit by bit, down-to-earth market work, can form the company's true execution and competitiveness!
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