Tips for Retail Success

From the Entrepreneur’s Perspective: Must I agree to retailer marketing BEFORE they will consider our products?

There is no cookie cutter approach to marketing. There are so many variables that will impact where you put your marketing dollars. Defined objectives, within your budget, must lead the decision making. To add complication to this strategic and creative process, every retailer offers different marketing programs – at a cost that can break the bank or be given to you for “free” (more on this below); how much you can afford to spend AND how much your direct and indirect competitors are contributing to these in-store marketing programs within the same category; how saturated your category is/isn’t; whether your product is offered chain-wide or regionally; and the list goes on. As Vanessa will point out in her blog on this same topic, this is not Marketing 101, and because this blog is already too long, I am hitting on just some of the key points that you should consider when evaluating what in-store marketing programs you should, or can, agree to before or after you land an account.


In-store marketing programs

Every retailer offers different in-store marketing programs. And, every retailer offers them at different prices. And, every retailer implements those programs differently (i.e. some are implemented well and others not so well. TPR, circulars, couponing – these are proven programs that have been around for years (however, there is even strategy around when and how these programs are implemented – another topic that we don’t have time to explore herein). Or are you being asked to consider some groundbreaking program that has not yet been fully tested and are you now a guinea pig hoping that this new “trend setting” program is going to be a hit? Tread carefully. The retailer may not have worked out the kinks.


Marketing programs can and should be negotiated upfront as part of your initial launch. You then know how much you are truly spending on your overall cost to land this account. This can be a major reason you don’t move forward with a retailer, so let me impress upon you how vitally important this truly is. You need to know what, if anything, is expected of you as part of landing this account. And, you want to have as much say as to what you are spending those dollars towards (i.e. if you just say you will give them an 8% co op fund, then be specific where you want that 8% spent so you can direct which program(s) you will participate in that most benefit your brand). Also, some retailers may charge you a flat cost to participate in a program. For example, if you are considering participation in a TPR (temporary price reduction), there is likely a cost to participate PLUS fund the TPR. However, you might be able to get the buyer to waive the participation cost (which might be $15,000!) and “just” need to fund the TPR (and when I say “just”, I mean the TPR may be $3, $4 or some other dollar amount off per unit multiplied by thousands of units). We are talking big dollars here that you are paying.


It’s also important to note that how much you contribute to the buyer’s overall dollars, however they are achieved (i.e. through marketing spend, top or bottom line margins), may land you a place on the shelf or keep you on the shelf, or conversely, not land you on the shelf or get you discontinued. You are competing for that shelf space and the buyer is going to look at their entire product assortment with how much each brand is contributing to his/her strategic objectives, which you only have a bird-eye’s view of – in other words, you will never know what pressures the buyer truly faces. To be as educated as possible, truly listen when your buyer speaks and read the retailers’ annual report, if one is available.


*One side note which I have mentioned in a past blog: your launch may not go accordingly to plan. I.e. you may have been told that your product would launch by mid June. However, for many reasons, let’s say it doesn’t actually hit the store shelves until mid July. So, when you are discussing when to implement marketing programs, you may be better served by giving yourself some breathing room and commit to a program(s) that starts on August 1st. Let’s try to avoid costly “mistakes” or uncomfortable discussions with your buyer. Breathing room, please. Or, at least an upfront discussion of, “I will agree to that July 1st TPR, but if the product is not on store shelf by this date, I will then not be responsible for the implementation fee and I will only fund the TPR.”


How saturated is your category

The more saturated your category, the more you will need to market your brand to set it apart. So, be prepared to invest in in-store and/or out-of-store programs. Note that I did not say to invest in only in-store or only out-of-store programs. Nor did I say invest in both. I said “and/or”. There is no right answer. You need to make educated decisions based on what you do know. Listen to the buyer. Read the annual report. Walk the store aisles. Look at the ROI you have on other programs that you are currently running and/or have run in the past. What are your competitors doing? And, have you noticed that what they are doing seems to impact your sales?


Chain-wide or regional roll out

If your product will not be sold chain wide, your options to participate in marketing programs are usually diminished (i.e. certain programs are just not available to you). Frankly, you would not want to invest that kind of money if your product was not available chain-wide anyway (i.e. why be in a national ad or circular, let’s say, if you are available in a small fraction of the stores? The customer can’t find your product, so you do not benefit from a sale. Further, you will frustrate your potential customer who can’t find your product and you will likely drive a sale to your competitor.

If the buyer is unable to yet commit on a chain-wide or regional rollout, you can propose marketing plans for both options. If my brand is rolled out nationally, I can commit to XYZ programs; and if my product is rolled out regionally, I can commit to XYZ.

Vanessa and I have years’ worth of experience crafting these marketing plans. While there are common elements necessary in developing an effective marketing plan that will resonate with a buyer (I’ve given you some strategies above that apply to “all”), as I started off this blog, there is no cookie cut formula. It’s a strategic and creative process.


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