Not doing terminal marketing is death: without a clear terminal strategy, terminal evidence, and terminal support, attracting distributors is difficult! Thus, one falls into a simple cycle: "Hire salespeople—reimburse travel expenses—basically no distributors fall for it—fire salespeople, and rehire."

With sufficient funds and heavy advertising, you can stimulate distributor cooperation, but the input-output ratio is not as good as doing terminal marketing. Think back to Wanda Dry Red, Yeli Dry Red, Yinxiang Dry Red, and Dangran Dry Red, which invested heavily in air bombing but had weak terminals. As a result, distributors' purchases were insufficient to offset corporate expenses, and both distributors and companies suffered losses, making it unsustainable. Meanwhile, Yantai Great Wall Wine, which started almost at the same time, had only a fraction of the funds of those peers. By adopting the "marketer + core terminal" model and focusing on thousands of core restaurants and nightclubs in over 20 cities nationwide, its sales quickly jumped into the top 5 nationally, with the highest profit margin.

To increase companies' confidence in doing terminal marketing and reduce detours, we have distilled the 19 most critical concepts of terminal marketing, attempting to give readers a grasp of the basic principles and laws of terminal marketing.

  1. Terminal A terminal refers to the end point of a commodity. Commodities differ from "supplies." Commodities are "for sale" (manufactured for sale or bought for resale); supplies are for one's own use. As a commodity "for sale," it can only go to the terminal; after the "critical jump from commodity to money" at the terminal, it becomes the consumer's own "supply," losing its commodity nature. Retail outlets are terminals; group-buying organizers and intermediaries are terminals; in multi-level marketing, the second-to-last level (the last person who buys to sell) is also a terminal.

  2. Terminal Strategy Strategy is choice: it is the choice of which terminals to target, which models to adopt, and which terminal resources to allocate. The basis for formulating terminal strategy is the "three marketing elements": customer strategy, competitive environment, and core competencies. Based on your customer goals and the location of core customers, choose your terminals. For example, Coca-Cola's "3A" policy—available, affordable, and acceptable—belongs to the customer element of terminal strategy. Based on the competitive landscape and your competitive policy, determine your terminal targets, terminal quantity, and terminal tactics. Finally, terminal selection must align with your core competencies. Overreaching to develop terminals you cannot serve will lead to exhaustion and failure; using a sledgehammer to crack a nut wastes resources and is not worth it.

Thus, the terminal is the "face of the enterprise's core competencies": financial strength, profitability, performance systems, product capability, and salary levels are all visible at the terminal.

  1. Core Terminals Whether to differentiate terminal value and formulate separate strategies depends on the enterprise's strategy.

Some enterprises engage in "undifferentiated terminal coverage," with "air advertising bombing + ground street-sweeping terminal coverage and terminal interception." Without core terminals, no terminal will actively promote the product, nor do they expect them to; product sell-through depends on brand and consumer brand-name purchasing.

Some enterprises rely on terminal recommendation power and actively support core terminals. Examples include McDonald's with Coca-Cola, KFC with Pepsi, Walmart with P&G, and Carrefour with Unilever—all are "core terminal strategies."

How to distinguish ordinary terminals from core terminals? Common errors and misunderstandings are to decide based on terminal scale, grade, or sales capability. In fact, different terminals have different values relative to different core competencies. Value is relative to the enterprise's core competencies and strategic goals, not objective.

  1. Core Sales Terminals Core sales terminals are typically high-traffic sales venues such as supermarkets for daily necessities, and specialized outlets for electronics, furniture, and pharmaceuticals. Their characteristics are high customer volume, shallow interaction between the business unit and customers, and customers choosing products based on simple criteria. Core sales terminals are heaven for mature products: products that already sell well can amplify sales volume tenfold or a hundredfold when entering core sales terminals.

Core sales terminals are also the hell and grave for "products not yet mature." Countless excellent products with rich connotations that consumers have not yet understood, because the enterprise does not understand the rule that "core sales terminals are only amplifiers," blindly enter core sales terminals before the product is accepted and before the consumer's existing scale is unfavorable to the product. Amplifying zero sales by 100 times is still zero. And the entry fees, promotion fees, and other investments for "amplification" are wasted.

Bosses who build brands with a trading mentality are prone to this mistake: they do not know, or pretend not to know, that there is such a thing as "brand cultivation." They rush straight to core sales terminals, and when they fail, they blame "the terminal is black-hearted, charges too much, occupies my promoters to work for it; the promoters are incompetent, talent is hard to find."

  1. Core Promotional Terminals Simply put, any terminal that can deeply communicate with core customers and fully express the overall interests of the brand is a promotional terminal. Its function is not mainly to increase sales, but to convey the overall value of the enterprise and product, change consumers' values and the evaluation criteria for product selection, and cultivate the market and consumers.

Gree Air Conditioning is a successful case of the "dual terminal model": specialty stores are promotional terminals, where store technicians introduce Gree's unique advantages in detail, explain installation and maintenance knowledge, and may build personal relationships. Gome, Suning, and department stores are only sales terminals, mainly attracting customers with simple criteria like price, and their customers and staff are always strangers. For infant and child products, some community infant stores and baby stores can be upgraded to promotional terminals, becoming mentors for babies' growth in formula, clothing, bathing, and skincare; department stores remain sales terminals. For imported wine, wine cellars, tasting events, and canteens of provincial government agencies can be upgraded to promotional terminals; while retail wine shops, supermarkets, and some wine cellars, clubs, and specialty stores positioned as "supermarket condensed versions" are sales terminals.

Because promotional terminals can change consumers' evaluation criteria and purchasing behavior, they have earth-shattering significance for changing the competitive structure of the industry.

Pepsi was once bullied by Coca-Cola for a long time; later, an employee discovered that low temperatures make cola more delicious. So Pepsi quietly deployed tens of thousands of new beverage machines across the U.S., signed exclusive agreements with terminals, and then offered free tastings to hundreds of millions of customers on the same day. Customers found the taste delicious and thought "Pepsi tastes better than Coca-Cola," so Pepsi suppressed Coca-Cola. Coca-Cola panicked, abandoned its original formula to imitate Pepsi, which triggered protests from old consumers, and its market share further declined. After a long time, Coca-Cola woke up, reorganized its attack, and regained the top spot, but Pepsi also gained a foothold and could henceforth compete as an equal.

Guangdong Shuijingfang, during its growth, discovered many promotional terminals, such as golf courses. If it had signed exclusive contracts with golf courses back then, the later "Moutai Golf Exclusive" might have been strangled in the cradle.

Insurance originally had no good promotional terminals. Later, a smart person discovered the "bank" terminal, greatly promoting the industry's development. If one could sign exclusive monopoly contracts with various banks in advance, the enterprise that first thought of the bank terminal could suddenly surpass all peers.

Giti Tire's sister company, Giti International Paper, has been growing rapidly at low cost in recent years. One of its success factors is the strategy of "strike big-box stores, support new terminals," which is a "promotional terminal wins" strategy. Doing sales terminals well can add icing on the cake; doing promotional terminals well can create miracles.

  1. Three-Dimensional Layout Terminal layout is also part of terminal strategy and has a significant impact on the enterprise's "terminal expense ratio" and sales performance.

Most enterprises only understand geographic layout, knowing to protect core terminals regionally based on strategy; they calculate the number of terminals needed based on the purchasing power of the "unit radiation range."

"Business format layout" is a more important terminal layout. For example, wine involves business formats such as brand specialty stores, restaurants, internal canteens of party, government, and military agencies, hypermarkets, clubs, and community stores; pharmaceuticals involve hospitals, community stores, clinics, pharmacies, and drug hypermarkets. Each business format has different value; if laid out properly, they promote each other and cover each other; if not, they conflict. Some enterprises, unable to resolve conflicts, develop separate brands to segment business formats; this reduces conflict but sacrifices interaction and wastes resources.

The third important layout is time layout, which is the progress and structure of terminal expansion. For a bottle of wine in a specific regional market, you can choose to do group buying first, or restaurants first, or supermarkets first; all may succeed or fail. The key to success or failure is not what you do first, but what you are suitable to do first, and whether you understand the costs of doing it first.

What determines your choices remains those three key elements: customer positioning, competitive landscape, and core competencies.

  1. Terminal Interaction When terminal layout is reasonable, sales can promote each other.

In the wine market, we have tested that with the most reasonable layout, group buying, restaurants, and supermarkets can achieve a ratio of "1:5:25," meaning if group buying achieves 10,000 per month, restaurants can achieve 50,000, and supermarkets can return 250,000.

Interaction is divided into two types: (1) Linkage: Concentrating terminal marketing in a certain business format or region can multiply effects. For example, this month, offering a free drink with meals at all Sichuan restaurants in the city; or placing arches, flags, and other advertisements in a "food street" and conducting buy-one-get-one activities. (2) Chain reaction: Based on the objective correlations between terminals, focus on several types of terminals to drive others. For example, in 2001, Guangdong Shuijingfang used training marketing and other advantageous resources to serve "restaurants that do not charge entry fees," forcing ultra-high-end restaurants like Harbour City to lower their stance and waive entry fees. In the imported wine industry, we found that the model most suitable for small and medium enterprises is "marketing channels + promotional terminals + customer network engineering + sales channels and sales terminals."

  1. Innovation in Terminal Cooperation Models This is a very easily misunderstood issue. I have met many self-righteous bosses and professional managers who do not acknowledge "differentiated cooperation models." They think cooperation models are fixed, such as paying entry fees to enter restaurants, and the cost of entering supermarkets is the same.

In fact, cooperation models are ever-changing. Choosing different three-dimensional terminal layouts, changing "front-loaded investments" in terminals, and building different core competencies can all change terminal cooperation models.

Anhui is the second largest province for white liquor in China; Hefei is a must-fight place for all Anhui liquor companies. In restaurants, the most popular terminal model in Anhui's liquor industry is "plate in plate," which means competing to buy out the supply and promotion rights of restaurants at high prices. In such an environment, Shahe Business King Wine can still enter any bought-out restaurant with cash (only Business King does not pay entry fees and forces restaurants to buy with cash). The main reason is the systematic method I created, "using angle to counter force," which can persuade restaurants to "grant special favors." Later, Shanghai Shenxian Distillery borrowed this model, reportedly achieving a 50% acceptance rate in Fengxian and Nanhui areas.

  1. Entry Fee Strategy How to choose the cooperation model with terminals? Whether to pay entry fees to terminals? How much?

This does not depend on a single factor, but on the enterprise's terminal strategy.

We simplify as follows:

  • Deliberately overpay: Speculation; terminal value is undervalued; competitive point; reduce future competition; eliminate certain threats.
  • Can overpay: Value chain; sign exclusive agreements; portfolio strategy; single-store losses for overall profitability; total cost; exhaust competitors.
  • Change the way of paying: Value chain; joint promotions; differentiation; training marketing, etc.; financial capability; flexible payment terms, purchase prices, etc.
  1. Terminal Quality Terminal work evaluation is difficult, and rewards and punishments are often formalistic.

Together with colleagues from the American Kotler Consulting Group, I established the "Terminal Quality Management" system, which has been successfully applied to companies such as China Tobacco Shandong Industrial and Guangzhou Zhujiang Brewery, and has been borrowed by companies like P&G and Master Kong.

Simply put, terminal quality is the quality of the following 9 elements:

  • Location, quantity, form
  • Product, materials, personnel
  1. Nine Elements of Terminal Visual Management
  • Store environment, plasticity
  • Material combination layout
  • Product combination display
  • Color, shape, sound
  1. First Recommendation Rate This is a concept from the "ancient" Hongtao K company.

Hongtao K can be considered the "father of terminal marketing" in China, although its terminal techniques were inspired by Coca-Cola.

In the 90s, Midea's "turnaround" defeated Chunlan and Kelon; Shule once surpassed P&G, becoming the only company in the world to suppress P&G through a frontal attack. Among the success factors, one must be revealed: they hired a large number of former Hongtao K team members and learned Hongtao K's terminal techniques.

First recommendation rate is a concept first proposed by Hongtao K, meaning the rate at which retail terminal salespeople or service staff first recommend your product.

There is a real case. I accompanied a leader of a liquor company to inspect the market. As soon as we got off the plane, the regional manager accompanied us to dinner. When entering the restaurant, the waitress enthusiastically asked, "How many guests, sir?"

After sitting down to discuss local business, the manager cited many objective difficulties. As a consultant, my role was to "play the bad guy" so that his superior could be the good guy. So I said, "If I say your work is poor, do you think that's reasonable?" The regional manager naturally disagreed, saying, "You just arrived and don't understand the situation." I said, "Think about why I have reason to say your work is poor; if you don't even know the reason, you are even worse."

Later, I told him a rule: you have entered fewer than 100 restaurants, yet the waitress doesn't recognize you and asks you as a stranger, "How many guests?"; just now, the waitress did not recommend our product when entering.

Hongtao K attached great importance to the first recommendation rate, considering it one of the most critical factors for sales performance. The significance of first recommendation is far greater than second or third recommendation!

  1. Quality of Promoters This is also something everyone thinks they understand, but few truly fully understand.

Some bosses whimsically say: hire fresh graduates, they are easy to mold; others think: beautiful women over 25 will definitely perform better.

Alas, it's not that simple. Terminal promotion is the rational allocation of terminal resources. We can only provide a configuration decision model, not rigidly define each configuration state. The age, appearance, education, and salary of promoters are all elements of terminal resources. The key to choosing promoters is not their objective characteristics, but the terminal resource allocation strategy.

In the real market, we see 45-year-old sisters and aunties with excellent performance, and 18-year-old girls with ordinary looks who perform excellently. Conversely, poor performers are distributed across all age groups, education levels, and salary levels.

The key lies in "configuration," which is the coordination of the "value quantities" of promoters, consumers, products, brands, and the terminal itself (the 5V model).

  1. Amoeba Management Model The Amoeba management model is a technique for replicating and developing promoters.

The originator, Kazuo Inamori, is the founder of two "Fortune Global 500 companies" (Kyocera and KDDI). Terminal promotion is "every person fights for themselves," and superiors find it hard to control; promoters need to regard themselves as the leader's avatar (amoeba) and work from the perspective of an "avatar."

Xu Xianzhong, general manager of Liuyanghe Group's Tequ series, systematically applied and developed this "excellent promoter replication" "Amoeba management model" in white liquor promotion and group buying: making every promoter a protagonist, thereby achieving "all-staff participation in management" and "partnership-style management."

  1. Kotler's 10 Seconds Kotler's "Marketing Management" (paraphrase): "Products not included in the consumer's purchase plan are usually ignored and do not catch the eye; products with eye-catching displays and attractive materials can attract customers' attention for 10 seconds."

If the product value is clear, consumers will make a purchase decision or a decision to learn more about the product within these 10 seconds; this short 10 seconds becomes an indispensable opportunity for product sales; the goal of image upgrading is these 10 seconds. Kotler's 10 seconds is the most important standard for evaluating the level of a company's terminal materials.

Some advertising designers with an artistic background, and some self-righteous people who pursue "beauty" over market effect, are deliberately working against money and are unsuitable for enterprises. We only recognize this standard: whether it can attract attention within 10 seconds.

  1. Hongtao K's 30 Seconds Lu Caiwu, vice chairman of Hongtao K Group and general manager of the planning center (original words): "We require our employees to explain the product clearly within 10 seconds. If the customer's time allows, it should not exceed 30 seconds. Beyond this time, customers or user units will lose interest in listening."

Many "narcissistic" enterprises require terminal staff to talk endlessly, saying everything they think they should say. When the guest leaves impatiently, they even want to chase after them and ask them to listen before leaving.

  1. Walmart's 10 Feet One of the "Walmart principles" established by founder Sam Walton: When a customer comes within 10 feet of you, you should look at the customer's eyes gently and encourage them to ask for your help. This is summarized as the "10-foot attitude" and has become a Walmart employee guideline.

Countless promoters, under the wrong pressure of wrong leaders, stare at customers, forcing them to refuse and abandon their willingness to consume.

  1. Terminal Seven Steps These are the seven fixed tasks that terminal managers must do when visiting each retail outlet.

The originator of the terminal seven steps should still be the famous Hongtao K company. Later, it was widely adopted by companies like Master Kong and gradually improved.

  1. One Chart and Two Tables for Terminal Management The three most basic tools for terminal management:
  • Work route map: Originated from Hongtao K, where terminal staff truthfully fill in the work location for each time period each day. At that time, there were no mobile phones, so the company required each market manager to be able to call the company's employee working at a predetermined pharmacy at a predetermined time period. The key to the route map is the "six determinations": determine personnel, route, progress, number of stores to visit, work item indicators, and time.
  • Weekly plan table: Pre-list the "six determinations" for the next week.
  • Daily clearing table: This table later became widely popular through the use of the famous Haier Group. But its original creation should be Hongtao K, which rose in the mid-90s.
  1. Kotler's "Dual Channel Strategy" The key point supporting terminal strategy is an important factor in building enterprise core competencies.

Kotler summarizes as follows: (1) Marketing channels refer to the set of all enterprises and individuals that cooperate to produce, distribute, and consume a certain producer's goods or services, such as resource suppliers and facilitators (e.g., transportation, advertising, market research agencies). (2) Distribution channels refer to all enterprises and individuals that obtain ownership of a certain good or service as it moves from producer to consumer, or help transfer ownership. This mainly includes merchant middlemen (ownership) and agent middlemen (help transfer ownership). It also includes producers and consumers. But it does not include suppliers, facilitators, etc.

  1. Plate-in-Plate Theory A terminal marketing technique widely popular in the white liquor industry, adopted by brands such as Yanghe and Gujing.

It originated from Zeng Xiangwen's "core terminal strategy" and matured at "Beijing Shengchu Consulting Company."

According to Baidu Baike: The plate-in-plate theory means that the enterprise first focuses resources on core consumer terminals, using core consumer terminals as the marketing platform, conducting careful public relations and promotion activities for market leader consumer groups and leading consumer groups, cultivating the preference of these two core consumer groups for the product, and using the consumption of core consumer groups to drive the product's consumption boom at core consumer terminals; when the product is popular at core consumer terminals to a certain extent, it should quickly use the influence of the product's popularity in the small plate, supplemented by other related market promotion strategies, to distribute the product to quasi-core consumer terminals, ordinary consumer terminals, and other sales channels in a planned manner; ultimately achieving the goal of seizing the market high ground through the product's popularity in the small plate, thereby influencing and driving the entire market sales.

  1. Dual Terminal Theory According to Baidu Baike (excerpt): The dual terminal model was proposed by Zeng Xiangwen of the Kotler Consulting Group based on Kotler's principles and many cases.

Based on the evaluation of terminal value, using a series of indicators, terminals are divided into core terminals and ordinary terminals. A large number of practices have proven that core terminals have the function of radiating to ordinary terminals; rather than allocating resources evenly to each terminal, it is better to concentrate resources on core terminals; once core terminals are captured, ordinary terminals will follow suit.

Then, based on the resources and roles of terminals, core terminals are divided into two categories: core promotional terminals and core sales terminals. Promotional terminals are places for cultivating consumers; they change consumer purchasing patterns and change industry competition points; they change the competitive landscape of the industry and change the direction of the race between enterprises.

Core sales terminals are amplifiers of sales performance. Products that have already solved consumer problems can multiply their benefits at sales terminals; products that have not solved this problem are "zero amplified is still zero—wasting resources in vain."

The dual terminal model is a terminal decision model with internal driving force.

The above 22 concepts basically outline the basic contours of "terminal marketing"—strategy, tactics, and management.

Actively participating in terminal competition is the key to winning sustainable development for enterprises.

Let the storm of terminal competition come more fiercely!

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