For most distributors, selecting a good product is as difficult as choosing a good son-in-law. With intensifying competition, product life cycles are getting shorter. How to choose a product suitable for one's own business from the dazzling array of products has become a challenge for many merchants.

Now the competition among liquor companies is like a relay: one after another takes the stage. Which companies will have the last laugh? When selecting new products, many distributors have no basis or standards to rely on, making it hard to predict which cloud will bring rain. Based on years of frontline experience, I would like to share my thoughts:

First, Macro-level Considerations

1. Business Credit: When selecting new products, liquor distributors, especially baijiu distributors, must consider the company's creditworthiness. This is crucial for the success of a new product in the market. There is a saying in the baijiu industry: "One year topples a brand." If a company's credit is poor, distributors may be dragged down at any time, falling into the quagmire of difficult new product promotion. The case of "Siwu" baijiu in the Henan market chilled distributors across the province. Due to the manufacturer's operational difficulties, many distributors' products sat unsold and piled up in warehouses, leading to losses or even bankruptcy for many who distributed Siwu baijiu.

The creditworthiness of a company should be measured through its products. Specifically:

  • Low-end products: Examine their brand awareness. Low-end products are channel-driven; without awareness, they are hard to sell in the mass market. When selecting a new product, carefully investigate the awareness of its low-end products in the market.

Example: A distributor in Henan wanted to distribute a beer product. After market research, he found that Jinxing Beer had very high awareness across markets, known to many ordinary people, but there were not many mid-range products. Therefore, he quickly became an agent for Jinxing's mid-to-high-end products in third-tier markets. Within two years, he became one of the largest Jinxing distributors in eastern Henan.

  • Mid-range products: Examine their reputation. Mid-range products are also key for distributors when evaluating new products. In fact, the products that truly generate profit are mid-range ones: low-end for volume, high-end for image, and mid-range for profit. Therefore, when evaluating a company's mid-range products, reputation is key. Awareness alone is not enough, because mid-range products need to consider their premium pricing ability. To sell a product at a good price, brand reputation becomes even more important.

  • High-end products: Brand power and reputation. High-end products emphasize brand; cost-performance is not the main factor driving sales. Brand power has a significant impact on sales.

2. Market Planning: "Forewarned is forearmed; without preparation, you will fail." Any company or product must have its own plan. A company should have clear strategic goals and scientifically plan its product line.

For mid-term products: There should be long-term planning. For companies, mid-range products are profit generators with considerable sales volume. Therefore, companies should use different marketing strategies throughout the product life cycle to ensure sustained sales and delay product decline. Compared to mid-range products, high-end products should have strategic development plans of 5 to 10 years or more. Thus, distributors should consider the company's development plan when selecting new products.

3. 4P Strategy: Judging whether a product can succeed, the 4Ps are a key element.

  • Product strategy: For mid-to-low-end products, more emphasis is on price and packaging; for high-end products, quality and brand are the main considerations.
  • Price: For high-end products, cost-performance is the main consideration.
  • Place: For mid-range products, both circulation and terminal channels should be considered; high-end products mainly operate in hotels and restaurants.
  • Promotion: Generally, high-end products have fewer promotions; mid-range products often run consumer promotions; low-end products usually focus on channel promotions.

4. Model Market: Distributors looking at model markets is also a very important factor in selecting new products. When selecting, distributors should pay attention to research on model markets. The main contents are as follows:

  1. Overall marketing environment of the model market.
  2. Product strategy in the model market.
  3. Market operation process and control in the model market.

5. Management System:

  • Rules and regulations: Whether there are complete rules and regulations, market management regulations, etc. A mature company is quite cautious about launching new products, following multiple steps:
    1. Recruitment and training of organizational personnel.
    2. Market research.
    3. Advertising and publicity.
    4. Pre-launch warm-up for new products, including distribution, display, and visibility.
    5. Channel promotions to stimulate orders.
    6. Consumer pull and brand promotion.
    7. Inventory plans.

In these steps, management systems are very important, such as:

  1. Promotional item distribution system.
  2. Standards for promotional item placement.
  3. Standards for establishing exclusive stores.
  4. Measures against cross-regional selling (channel conflict).
  5. After-sales service.

Market competition has become intense; the days of broad sowing and thin harvest are over. For a company to develop successfully, healthily, sustainably, and stably, it must have a sound management system. This is also a criterion for distributors when selecting new products.

  • Personnel preparation: If the company has sufficient confidence and plans for the new product, relevant personnel should already be in place. If they are still in the recruitment stage, then training and management are out of the question, and the promotion of the new product will naturally be greatly compromised.

  • Team execution: Building a high-performance team is not a one-day effort. To do things well, you need a team with high execution, which comes from two aspects:

    1. Improving employees' own abilities and qualities. If an employee's abilities and qualities are insufficient, talking about execution is wishful thinking. Often, our employees are willing but unable; without company support, their efforts in the market for new products can only be a spent arrow.
    2. Motivating the team through compensation systems and promotion mechanisms. If employees have ability but lack effort, it's an attitude problem that can be adjusted through leverage. No need to elaborate.

Execution is a systematic issue. Imagine asking a person to ride a bicycle to the moon—can they accomplish that task? To improve employee execution, there must be tools, standards, plans, ideas, and strategies.

Execution is also a criterion for assessing whether a company can operate a new product. The quality of execution directly determines the fate of a new product in the market.

Second, Basic Analysis:

1. Understand the market operation of similar products. For companies, truly new products do not exist; most new products are upgrades of existing ones. Therefore, understanding the market operation of similar new products provides valuable reference for operating the new product.

2. Identify the unique selling point of the new product. Since it is new, it will have many differences from other similar products, and in the short term, other products cannot easily replicate them. Only then can barriers be set, forming a unique selling proposition, which is of great significance for brand promotion and communication.

3. Consult leading companies about their attitude toward the new product. Mainstream companies represent trends and directions, so their opinions are quite important for new product selection. Whether a product can succeed in a market depends on whether it can adapt to trends. Mainstream companies have the ability to guide market trends and observe new products.

4. Test marketing: Almost all distributors adopt the method of testing in specific local markets. This not only tests the product's market reaction but also summarizes experience, preparing for a full launch. The results of test marketing can truly reflect the real market situation of the new product.

5. Examination of market expenses. Market expenses are key to starting a market. As a company recruiting distributors, they should have a relatively complete market expense plan, with annual budgets and allocations. Specifically:

  1. Budget for new product launch.
  2. Budget for channel expenses.
  3. Budget for consumer pull.

By examining the budget plan, distributors can have a clear mind and targeted approach when promoting and selecting new products.

Selecting new products is a required course for distributors. Following marketing laws is key to business success. Distributors need to go with the flow, find the patterns, and choose new products that suit them.

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