On a monthly basis, the Willard Bishop Consulting Competitive Edge newsletter provides key insight and thought leadership to brand marketers and retailers looking to gain a sustainable advantage on the competition. The August issue is no exception as author Jon Hauptman discusses, “Building a Winning Shopper Value Equation.” The Shopper Value equation is defined as a go-to-market-strategy that fills important shopper needs in a unique and appealing way.
Retailers are pulling back on some recent initiatives that were designed to enhance efficiency, but in the end pushed shoppers away. Hauptman uses Walmart as an example, citing temporary price reductions, Project Impact assortment reduction and reducing aisle displays as failed experiments that the retailer is now reversing. This recent Walmart experience is an example of a company reverting to a clear, appealing shopper value equation. In other words, they are getting back to the things that made them successful in the first place.
Why does this happen? Hauptman says many retailers try to be all things to all people rather than identifying what they are going to stand for and taking a leadership position. Another factor is not being able to keep up with the latest shopper needs. Success is some areas and categories have lulled some retailers to sleep as their own success made them blind to the fact that competitors had caught up and surpassed them. Still another factor is not being able to see new competition such as Dollar and Drug chains offering food items.
Competitive Edge says that building a successful shopper equation requires a retailer to define key elements of its value proposition and then establish and implement strategy that makes them the clear and undisputed market leader in at least two of the elements.
Of course, this is all easier said than done. Headquarter strategy often falls short at the point of at-retail execution. That is precisely where partnering with NARMS members can help retailers and suppliers balance the Shopper Value Equation. Again, we thank Willard Bishop Consulting for sharing their thought leadership and encourage our members to download and digest the August issue by clicking here.
In the March edition of Willard Bishop’s Competitive Edge, author Craig Rosenblum extols the virtues of staying the course in, “Retail Strategy –Now is Not the Time to Walk Away From It.” Furthermore, he details a process that can help retailers validate and modify their strategic path during difficult times. The good news for NARMS members, providers of at-retail merchandising and marketing services, is that there are very clear targets of opportunity to support a well thought out strategic approach.
Central to the Bishop approach is to create a clear point of difference by developing a value proposition through the following equation: Value = (Price x Quality x Service x Assortment x Facility). At least three of these building blocks of value provide our members with a direct opportunity to be an active and vital part of the go-to-market process.
Certainly our service can help improve how retailers provide excellent service to their customers through superior execution of at-retail initiatives. While the Bishop report focuses on store employees, we can take it a step further and extend great service to include products being in-stock, new products getting to the shelf, displays getting out of the back room and products being supported by sampling programs.
Assortment is another area where NARMS members excel. The timely and accurate execution of planograms and category resets help bring proper assortment to the consumer. Our member’s get the job done faster, and in better compliance with headquarter expectations, thus assuring migration of chain strategy to the store level.
The physical condition of the store, or facility, is another area where NARMS members stand out. Be it a new store set-up, remodel, relocation, category reset or store-within-a-store, our members are all about being the agents of maintaining and adjusting facilities to fulfill and enhance the customer experience.
Download the Bishop report here and read more about the expert advice being given to manufacturers and retailers. Then decide for yourself how your company fits in to the go-to-market strategy.
The message from the fifth installment of our NARMS Webinar Series, which took place on Monday, was clear. Understanding exactly what is happening during the recession, yes recession, is the only real way to chart a strategy for success. During the event, Anthony Miyake of GroupM reflected on consumer spending and the net effect on retailers. He was also kind enough to share some of the GroupM information and methodology for assessing the economy. His advice to brand marketers was to ramp up efforts to define their value proposition as a tactic to insulate themselves from competitive price pressures and maintain brand equity. As providers of at-retail marketing services, we should also listen to that advice. We must ask ourselves which of our services are best positioned to help our customers define value. We must also find ways to remind our customers of our value to them.
The chain reaction of a downturn in consumer behavior could definitely have a negative effect on our members. But it doesn’t necessarily have to. It is no secret that sales promotion tactics such as coupons and mail-in rebates are counter-cyclical because their use is much more prominent during down economic times. I would bet that coupon clearing houses and rebate fulfillment companies are not currently complaining about the economy. We know that there are many sales building activities that take place at-retail and that we are well-positioned to help our customers maximize their investments by ensuring execution at shelf-level. Depending on store management and personnel to carry out important initiatives simply does not work.
If you are looking for ways to effectively communicate the value of NARMS members, revisit our NARMS InfoShare series for various publications that contain facts, figures and ideas that you can use in your sales pitch. And remember that you are always selling, even after the program or project is complete.
We again thank Anthony Miyake and associate member GroupM for sharing their time and information with us. In fact, GroupM has just released their second in a series of five articles published by GroupM Business Science to help businesses and marketers assess and optimize their marketing spending. We also once again thank ReadyTalk for their outstanding support and excellent technological tools. And don’t forget to tune in on Thursday, December 11 at 2:00 PM EST when Carolyn Weiland of StarWorks will lead a discussion on, “Marketing Tools That Work in Challenging Times.” The Webinar series is free to NARMS members and is a great way to add to your understanding of the current marketplace.
The Tampa Bay Rays seemed to have everything going their way with a 3-1 lead in the best-of-seven American League Championship Series against the Boston Red Sox, and a 7-0 lead late in game 5. That is about the time when the force of nature known as the Red Sox mighty offense caused a significant shift in the competitive environment. The Sox came back to win game 5 and game 6 to force a pivotal game 7. But this didn’t turn out to be a crash and burn story for the Rays. They overcame the momentum shift and got back to the doing the things; namely starting pitching, solid fielding and timely hitting; that helped them win the American League East title. The result is that they are going to their first World Series against the Philadelphia Phillies. There are many CPG companies who have experienced the same thing recently. Good times have been derailed by force of nature type economic factors and unprecedented competitive forces. The October issue of Willard Bishop Consulting’s Competitive Edge suggests that manufacturers can follow the Rays example by sticking to the knitting (or hitting as it were). In this case it is providing value to their customers. Doing so can help them overcome the tough times and ultimately win the day.
As we were reminded in yesterday’s monthly NARMS webinar hosted by Mark Hunter, “Winning Sales Strategies in Difficult Times,” value is defined not by what the customer pays for a good or service, but by the benefit they derive from the service. Mark reminded us that this is quickly forgotten as competitive pressures mount. In the article for Competitive Edge, author Jim Hertel concurs, “Economic pressures on retailers can quickly translate into margin pressures and price increase pushback for suppliers. As a result, suppliers need to understand, improve, and get credit for the total value they create beyond product and price.” Hertel says there are four major levers that suppliers can use to add value and get credit for it: increase demand, reduce cost, increase merchandising impact and develop an effective go-to-market approach. It is in the latter two where NARMS members have an opportunity to add value to our customers, as they add value to theirs.
Hertel goes on to say that in order to accomplish this, suppliers may need to change the way they engage their customer, and key among these are shopper insight and shopper marketing capabilities. Again, NARMS member ears perk up.
Now that we have the point in scoring position, it’s time for the big two-out hit. Tuning in to resources like the NARMS Webinar Series, Willard Bishop’s Competitive Edge, and other such studies and publications can be a great aid in identifying areas where we can help our customers add value. In doing so, we establish our companies as a vital and reliable part of the go-to-market system and not just a switch-on service that is far too susceptible to competitive and economic pressures.