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For many distributors, product distribution can be done quickly, but market activation after distribution is slow. Once products don't sell, it leaves a bad impression on retail stores, affecting long-term relationships and making it difficult to distribute new products in the future.
Judging the quality of a distributor's product operation, terminal sell-through after distribution becomes the most direct and important indicator. Because the terminal is the final step where consumers decide to buy, and it is where distributors ultimately realize profits. If the distributor operates well, the terminal can guide consumption, enhance brand image, increase product flow, and secure better and more survival space and resources for the distributor. With intensified competition in the baijiu industry, terminal sell-through has become the core lifeline of sales in the distributor's market. Therefore, solving the problem of terminal sell-through is the top priority for increasing sales. So, how can distributors solve the problem of product sell-through after distribution?
Case Analysis
Li Qiang is a county-level distributor who has been operating for many years. With years of accumulated relationships and customer resources, he achieved good development. However, with the arrival of the adjustment period in the baijiu industry and intensified market competition, pressure from upstream enterprises, competition from peers, rising marketing costs, and higher demands from downstream customers caused Li Qiang's company's sales and profits to plummet. To ensure the company's sustainable development, combined with the baijiu situation in 2013, Li Qiang conducted a careful market survey and chose a mass-market baijiu brand to operate.
Reasons for Poor Sell-Through
Regarding the slow product sell-through, Manager Li personally went to the market. During his visits, he found several main reasons for the slow sell-through of new products:
Low overall distribution quality: Sales staff purely pursued distribution rate, only focusing on completing the number of stores within the specified time, without in-depth understanding of the target terminals, leading to a mismatch between the product's target group and purchase locations. For example, some stores are completely mismatched with the product, and some stores are in a half-dead state. This leads to slow product sell-through, causing the product and brand image to decline.
Distribution without management: After distribution, terminal management is equally important, requiring follow-up management and close service. Simply distributing without managing is worse than not distributing at all. During market visits, Manager Li found that the phenomenon of distributing without managing is everywhere. For example, in some terminal stores, the product is placed but in an inconspicuous position, so customers don't notice it; in others, the product is placed in the warehouse, and the shelves are empty. The terminal network has width but lacks depth. Another situation is that the market distribution rate is good, but there are many outlets, yet very few core outlets that actually generate sales.
Weak terminal visualization: Sales staff go through the motions, appearing busy, but actually they are just running to outlets, simply focusing on delivery, payment collection, and other routine business tasks. The sales volume of distributed products becomes the only goal, and they don't seriously solve problems. Their daily work is just checking if the store has stock and if they need more. It seems everyone is busy running business, but they are only doing superficial work and not fully taking responsibility to achieve true channel smoothness. For example, some salespeople forget product display and terminal visualization (such as promotional materials, price tags, POP, shrink wrap, KT boards, etc., supported by the company for brand promotion, which are almost invisible in the market), and some forget to introduce the product's unique selling points and personality.
Clever Strategies to Attack Targets
Plan event marketing to attract attention: Open a good market entry point and create a sensational event to attract social attention, especially from liquor consumers. These easily become news hotspots and hot topics on the streets, quickly increasing brand awareness, making consumers think of the brand and generate purchase desire. Manager Li planned a promotional activity "Drink XX Fine Wine and Win an Electric Bicycle," strategically placing the electric bicycle prizes, and then combined with local media coverage of the electric bicycles. This attracted high attention from target consumers, quickly increasing product awareness, thus solving the sell-through problem.
Strengthen the quality of terminal promoters: Nowadays, liquor distributors often place promoters in terminal stores with high liquor sales and high customer traffic, such as large hotels, supermarkets, and core famous cigarette and liquor stores, for on-site recommendation and promotion. Although similar promotional methods are adopted, due to different brand influences and promotional skills, the promotional effects vary greatly. In addition to ensuring that the taste of the liquor they operate matches local consumer preferences, distributors should also train promoters in liquor culture knowledge and consumer psychology. Because if the promoters' quality and promotional methods are appropriate, promotional efficiency will be greatly improved.
To improve the quality of terminal promoters and effectively enhance brand terminal performance, Manager Li established a strict management system to regulate the behavior of terminal promoters: First, require terminal promoters to submit work information reports based on daily sales; second, sales managers regularly go to the market frontline to fully grasp the real situation at terminals, objectively evaluate the performance of terminal staff, and implement established reward and punishment policies; third, systematically train promoters in both theoretical knowledge and practical skills, provide targeted supervision and guidance, and enhance their sense of responsibility and belonging.
Product display has its nuances: Terminal product display is silent advertising, creating a strong visual impact and attraction for consumers, and is the most intuitive interpretation of brand image. It is also an important reason for impulse purchases. Combining the company's existing problems, Li Qiang standardized terminal display from the following three aspects to effectively enhance brand terminal performance.
Set appropriate display positions. Based on first-hand market research data, Li Qiang found that the more customers who come into contact with the product, the greater the chance of purchase. Therefore, the company formulated specific display standards, such as the principle of prominent position (the position where consumers can see it at first glance when entering the store); the principle of brand concentration (to showcase brand strength, enable consumers to obtain related and holistic brand associations, and deepen the product's impression in their minds), etc.
Conduct vivid displays. Vivid terminal displays not only attract consumer attention and stimulate purchase desire but also shape a distinct brand image, directly enhancing brand terminal performance. For example, set up reminder signs and notice boards in large hotels; post advertising posters in low-end stores, hang banners inside, hang lanterns under the eaves outside, and arrange POP posters and silk balls on the bar counter in hotels: add brand advertisements to table cards, menus, tablecloths, ashtrays, magazine racks, clothing covers, etc.
Create a hot-selling atmosphere at the display point. Research results show that about 70% of consumer goods customers make impulse purchases at the terminal, so a good sales atmosphere can help companies increase sales by 30% to 50%. Therefore, Li Qiang comprehensively used scenes, displays, showcases, in-store POP displays, DM stands, model displays, promotional short films, and the performance of shopping guides to attract customer attention and enhance the hot-selling atmosphere at the terminal. To obtain the best terminal performance, Li Qiang's company's terminal displays also combined industry and product characteristics, marketing strategies, and the location and structure of terminal stores, consistent with the advertising image and promotional activities, selecting appropriate timing for creation, and unifying and refining the operational standards for placement, to set off the desired hot-selling atmosphere.
Based on the dynamic strategic combination of "points" and "areas" in the regional market, adopt the strategy of "using points to drive lines, and lines to drive areas," strengthen customer relationships and vivid advertising to achieve outlet sell-through, and research with terminals on how to quickly sell products.
For example, select 50 terminal stores from the many that sell less than 5 cases per month, and formulate a plan to increase their monthly sales to 10 cases, i.e., the "Conquer 50 Terminals" plan. If these 50 stores can each sell 10 cases per month, that's 500 cases. Then replicate the process with another 50 stores, reaching 100 stores. Just these 100 stores would sell 1,000 cases per month. In this way, replicate the process to achieve outlet sell-through.
How to implement the "Conquer 50" plan?
Select terminal outlets well: The selection criteria are: first, high foot traffic, suitable for selling your product, and the product has already entered; second, terminals where competitors sell well and you have also entered. Such terminals prove that your product can also sell there, and if you sell well, you can also strike at competitors.
Concentrate forces to attack: In operation, concentrate manpower and material resources on these terminal outlets. First, arrange the most capable salespeople to be solely responsible for these outlets; second, these outlets always maintain a maximized display surface, the best advertising layout, and the highest quality customer service. Doing so, on the one hand, can reduce competitors' display space. The less conspicuous the competitor's display, the greater your opportunity. Through maximized advertising and display, it directly plays an advertising role to consumers; on the other hand, helping these terminals sell products not only helps outlets digest inventory, brings in reorders, and strengthens customer relationships, but also because of product sell-through, terminal owners gain confidence and proactively help you sell the product, leading to a virtuous cycle of sell-through.
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