The FMCG industry is characterized by rapid innovation, low barriers to entry, easy replication, and volume-based success, leading to a flood of new products each year, most of which fail—some become pioneers, others make wedding dresses for others. For new product launches, beyond product planning, the key is to solve sell-through; if products don't move and consumers don't buy, even the strongest distributors can't sustain. Especially in an era where large retail groups dominate, sales networks don't give much reaction time, requiring performance in the short term or being cleared out. Based on years of FMCG experience, the author reveals the secrets to solving sell-through issues.
Misconceptions in Solving Sell-Through
Misconception 1: Overdrawing the product's added value for quick wins During product planning, a certain added value is usually attached to the product; the bigger the brand, the higher the added value. If in the early stage of launch, to chase volume, you severely overdraw the product's added value and blindly engage in price wars, you'll only lose more than you gain and defeat yourself. The author experienced a high-end XX brand aiming to be the industry leader. The industry has lagged behind, with no national brand yet, and huge market space. But in early market development, the company lacked strength, didn't want to invest heavily, entered few channels, had no advertising effect, making sell-through difficult. More critically, the product had a short shelf life, so disposing of it quickly became a top priority. With no choice, they sold at rock-bottom prices in existing stores, even lower than competitors. The high-end product became a low-end brand. Early on, we can forgive low prices, but now with more channels and some brand awareness, still sticking to low-price strategy severely overdraws added value—do they really want to turn high-end into counterfeit?
Misconception 2: Not focusing resources, spreading nets everywhere Spend according to your means; avoid greed—this is the way of distribution. From manufacturers to small distributors, in the early stage of new product launch, you must concentrate your resources, seek a breakthrough at one point, and penetrate point by point. If you're truly capable and can play resonance marketing—one point breakthrough, multi-point resonance, achieving a four-ounce pull of a thousand-pound effect—even better. Based on the company's existing resource advantages, such as unique advantages in modern channels, focus resources on doing well in stores, and don't divert other resources.
Misconception 3: Recognize the ugly face of stores, be cautious about entering Stores have monopoly advantages as independent market units, giving them absolute advantage at the negotiation table, requiring suppliers to be obedient, and operating costs are high, such as entry fees, barcode fees, anniversary fees, and various other charges listed like a cart. During operations, there are also relationship fees and hidden rebates, giving suppliers headaches. More critically, you must meet minimum tasks by any means, or you'll be removed. The common way to boost sales is promotions, special prices, or buy-one-get-one; buy-one-get-one is generally less effective than special prices. If to complete tasks you keep using special prices, it severely overdraws product added value, but suppliers have no choice. Stores don't care about your survival; they only want performance. So, think carefully before entering a store; remember, if you're removed, your entry fee won't be refunded a cent.
Common Tactics to Solve Sell-Through
Tactic 1: Concentrate forces to annihilate enemies one by one In marketing, everyone knows about deep cultivation of horizontal and vertical channels, but many fall into misconceptions. Any theory has a premise; this approach only suits financially strong entities or mid-to-late market stages. In the early stage of new product launch, operators must choose key channels based on existing channel advantages and product characteristics, following the 80/20 rule, breaking through key points one by one. For example, high-end products first break into supermarket channels; snack foods first break into school, internet café, and other outlet channels; famous products first break into famous tobacco, alcohol, and specialty stores.
Tactic 2: Identify target customer groups, normalize product promotion Understand that channels are one carrier for product sales; the real acceptance and consumption come from consumers. For new products to sell through, the key is to trigger purchase behavior among target groups; otherwise, products just sit in channels. Manufacturers attach great importance to product promotion, from small free trials to big draws and advertising, plus large roadshows, to increase product exposure and attract target groups' attention, prompting impulse purchases. Through word-of-mouth, the first group influences later ones, forming a domino effect. For example, if the consumer group is high-end, promote in high-end communities; if it's babies, promote in baby stores, early education institutions, and hospitals; if it's general consumers, promote outside large store entrances. Market promotion has several elements: create momentum; product advertising pull; proactive staff; deep customer experience.
Tactic 3: Promotional pull has techniques To accelerate sell-through, promotions are essential. Common promotions include special prices, buy-one-get-one, joint promotions, etc. Special prices are the most primitive and effective, but not feasible in the new product promotion stage, as they severely overdraw added value and fail to imprint the original price in customers' minds. Buy-one-get-one gives a gift of certain value based on the original price, emphasizing the original price, so customers remember the original price.
Gifts can be the product itself or new products; bundling bestsellers with new products can force consumption and increase trial rates. You can also do joint promotions with best-selling manufacturers; the partner must be related to the new product and have a certain sales base, thereby increasing trial rates. Additionally, choose DM or posters over in-store promotions; display as floor stacks rather than normal shelves; use explosive tags and hanging flags instead of normal small price tags; have promotional staff actively call out rather than stand like statues. In short, a successful promotion involves many techniques.
During the new product launch stage, stabilizing the price system is paramount, as it determines product positioning and marketing positioning.
Tactic 4: Ground advertising as the main, space advertising increasingly ineffective This isn't to say media ads are ineffective, but in today's media-saturated world, the ROI of media ads is low, and customers are increasingly annoyed by intrusive ads. For example, when you're engrossed in a TV drama and an ad pops up, do you care what it is? Probably just complain. Ground advertising has low costs, high exposure close to consumption sites, and is increasingly valued by manufacturers. Examples include window ads, pillar wraps, wall ads, hanging flags, floor stack fences, and closed-circuit TV ads in supermarkets; door heads, POP stickers, wall spray ads, hanging strings, and empty box displays at entrances in distribution channels; vehicle ads and employee uniforms for clients; and roadside signs, elevator ads, and bus ads in public places. I especially recommend closed-circuit TV ads in supermarkets; wall-mounted TVs can be self-placed by manufacturers to loop promotional videos; some supermarkets have fixed TV carriers that manufacturers can use, like international Walmart, Carrefour, and RT-Mart. Shopping venues are already shopping and leisure environments; a bit more commercial atmosphere isn't excessive and won't annoy customers.
Tactic 5: Optimize displays; display is the best living ad Display is the best advertising. The larger and better the display, the higher the chance of customer visits; also, display space shows the manufacturer's strength and brand. The basic principle is to have a larger and better display than competitors, place new products in prominent positions, with the golden line at the customer's eye level within 45 degrees. A small trick for display beautification is to stay close to bestsellers, including competitor bestsellers, for cross-selling; the items adjacent to competitors should be our non-bestsellers or new products to avoid gaps. Display methods include horizontal and vertical; choose based on customer habits and communicate with the store. Display is the biggest manifestation of shifting from product-oriented to customer-oriented.
For example, Coca-Cola has high display beautification, with floor stacks, fridge displays, small shelves, end caps, price tag jump cards, and vending machines in public places. It's evident that brand manufacturers value display highly, and their beautification is a model for many. In supermarket channels, every inch is gold; display is mainly achieved through fees and negotiation, a game between manufacturers and stores, a contest of strength and counterforce. Negotiation has skills; experienced salespeople can obtain better displays at lower costs by clever negotiation, catering to buyers' needs and gaining their support. In distribution channels, best displays are often obtained through display awards, like grabbing the best end caps, placing in prominent positions, and displaying at entrances.
I recommend the shop-in-shop display, which we can see Mengniu and Yili large manufacturers are already using, especially during festivals for gift sales. Shop-in-shop means jointly creating a manufacturer-styled zone with the store, freely showcasing the manufacturer's potential, maximizing product lines and corporate culture, forming a temporary brand isolation zone, and enhancing customers' on-site experience.
Tactic 6: Personnel pull is the main factor in sell-through In sales venues, having relevant personnel introduce and pull, especially authoritative recommendations, can achieve good sell-through. In the pharmaceutical industry, doctors prescribing with high commissions is common; in FMCG, investing in full-time or hidden promoters to recommend products to willing customers is also common. When we stroll in supermarkets, we sometimes find more salespeople than customers, reaching an unprecedented peak in personnel recommendations.
With fierce competition and personnel chaos, it's normal for personnel input-output to be disproportionate. Before investing in personnel, manufacturers must consider the venue's foot traffic and the costs they can bear to decide between full-time promoters or hidden promoters. Hidden promoters usually have a base salary and are motivated by high commissions. Henan Shaolin Temple Crispy Cakes achieved good channel sell-through through hidden promoters. Full-time promoters now compete on quality and skills; their quality often reflects the manufacturer's corporate culture and industry position. Well-trained promoters can maximize purchase rates and increase average transaction value, intercepting customers in effective sales areas and blocking competitors. So, sell-through competition is a contest of personnel capability.
Tactic 7: Set task thresholds for distributors, turning pressure into motivation Many manufacturers use this tactic: sign annual sales tasks, break them down monthly, with various rebate forms like monthly, quarterly, and annual rebates to boost customer enthusiasm. Distributors have certain distribution networks and mainstream products; by squeezing their warehouse and finances with tasks, creating pressure, and forcing them to allocate more human and material resources, they can invest sufficient energy in new product development, enabling sell-through. To a certain extent, this achieves transfer from warehouse to channels. Although not true sales, it provides sufficient channel carriers for sell-through. Distributor tasks must be flexible and realistic; setting unattainable tasks by patting your head will undoubtedly dampen enthusiasm, turning positivity into counteraction. Flexibility means staged task indicators; completing each stage earns corresponding rewards, with higher indicators yielding higher rewards.
Tactic 8: New products must have high profit returns The best way to motivate channels is high unit profit; with the same sales volume, selling one case equals selling three of a competitor, so supermarket buyers will be happy to sell. I remember chatting with Carrefour buyers; Mengniu's milk had higher gross margins than Yili, so they had reason to allocate more terminal resources to Mengniu for higher returns. Similarly, store owners in distribution channels are happy to recommend your product if unit profit is high; the store owner is the store's image ambassador, and their words carry weight. If distributors have high gross margins, customers will mobilize all forces to recommend your product. When Wahaha launches new products, they can blanket streets and alleys overnight; besides strong channel resources, more importantly, new product profits are high, and they know they can make money following Zong Qinghou. After Wahaha's new product launches, they generally leave high profits for channels, and all upstream and downstream channel customers are enthusiastic.
Remember, a new product selling well relies on the crystallization of efforts from many channel personnel, the result of resonance of many resources; everyone understands the power of many hands. Resonance marketing means finding a key resource point to configure maximally, producing strong vibration effects, driving all related resources to resonate, achieving a four-ounce pull of a thousand-pound effect. This is the essence of resonance marketing. Compared to integrated marketing, resonance marketing has lower cost rates and suits small and medium enterprises. How to find the resonance point depends on the enterprise's actual situation, market competition environment, and product characteristics. The author's high-end egg industry achieved sales linkage through high-end community product promotion and membership card sales, achieving resonance and effectively solving sell-through.
Reply with the following keywords to categorize and read related professional articles: Sales Supervisor, Second-Tier Management, Regional Manager, Distributor Management, New Channels, City Manager, Competition, 2015, Manufacturer-Dealer Game, Product Stagnation, Terminal Visit Management, Route Management, Deep Distribution, Internal Management, Sales Skills, Profit Improvement, Recruitment, Distribution, Daily Management, Team Motivation, Channel Promotion, Sales Misconceptions, New Product Launch, Township Market, New Product Pricing, Sales Target Achievement, Closing Orders, Market Visit Inspection, Baijiu, Beer, Sales Increase, Agency Products, Cross-Region Sales, KA, Terminal Vividness, New Market, Market Operation, Learning, Book Recommendations, Inventory Management, Sales Novice, Consumer Promotion, Execution, Old Products, Expired Product Handling, Model Market, Investment Promotion, New Media, Distributor Development, Performance Appraisal, Assessment, Annual Planning, Shopping Guide, Morning Meeting, Display, Transformation, Stock Pressure, Festival, Distributor Cost Control Channel Operation, Marketing Theory and Laws, Brand Truth, Order Meeting, Team Management, Training, Debriefing, Work Report.