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Making
an Impact at the Point of Purchase
By Melissa Orr
www.campaigners.com
You've
been thinking about buying a digital camera for sometime now, so you
decide to check out a few at your local CompUSA. The thing is you
know nothing about what differentiates one digital camera from another.
As far as you're concerned, they're all pretty much the same. You
get to the digital camera aisle and begin your investigation when
a store sales associate approaches you. "May I help you?" And that
is where the consumer to buyer relationship process begins.
It's a crap shoot where it can go from there, yet this is the most
valuable and important time in a marketer's eyes….just prior to the
purchase decision. Does the sales associate know the products, can
he better educate you on the product and most of all, and can he convince
you to buy the product? You can bet the sales associate is going to
point out the product that he knows something about — and is
that product YOUR product being sold?
How can you insure that your product is the one the sales associates
are talking about? How can you trust your product is well displayed
in the store and not hiding behind a disarray of competitor's products
jumbled together on the same shelf? Lastly, how can you make sure
your product is actually being demonstrated and sold in store to potential
buyers? This is where the impact of field representation comes into
play. So, let's go straight to the source...
We recently conducted a survey with our field sales and marketing
representatives, which we call "Delegates." We asked our Delegates
in what ways have they made a difference in stores for our clients.
There were several recurring themes that are the essence to successful
sales and marketing of manufacturer's products:
- Extensive
knowledge of the products represented
- On-going,
trusting relationships with store personnel
- The
ability to train store personnel in a quick, thorough manner
- An
overall positive attitude: to have fun and make it fun for both
the store personnel and the customer
"Merchandising,
Training and Market Research are core to the services I provide a
manufacturer", says a three year Campaigners' Field Rep veteran. "I
am only in the stores for a small amount of time (when you consider
how many hours these stores are open). I make sure to leave a lasting
impression of my expertise and enthusiasm, so it continues to live
on through the sales associates after I leave."
Another Delegate states, "I follow up on promises made and go the
extra mile — from delivering a not-for-resale copy of the product
to helping them secure corporate licensing deals. I am working side
by side with the sales associates to sell more product. It is not
unusual for the store manager to see me and tell me how great a certain
product demo was - AND how many units they have sold and continue
to sell."
"Today the market is flooded with new products," states one Delegate
who has been working with Campaigners and their clients for the past
4 years. "Some store associates take the time to learn on their own,
when they can. However, there is no replacement to doing my own real
live, face-to-face training and demonstrating. My product knowledge
and enthusiasm is contagious. The sales associates sell what they
know. Therefore, it is my job to best educate them in order to better
sell the product."
The power of having 'eyes and ears' at the retail store level is imperative
to your bottom line. In addition to making sure your product is best
displayed and stocked within the store, and that sales associates
are being trained on your product properly, Field Reps have tremendous
purchasing influence over potential customers. They educate and influence
ready, willing and able buyers exactly at this pivotal time in which
they contemplate a purchase. Dispatching local field reps into local
retailers will increase sales. Go a step further by recruiting well-educated
and highly motivated sales professionals to be your 'feet on the street',
and your product will gain an unfair advantage over the competition!
Do you have a retail execution challenge?
Email me at morr@campaigners.com
...and I'll see if I can help.
Melissa Orr is President & CEO of Campaigners, Inc., a Performance
Marketing Agency located in Manhattan Beach, CA. Campaigners' services
include retail, reseller and event marketing, sponsorships and promotions.
To learn more about Campaigners, please contact us at: info@campaigners.com.
For more information on Campaigners' Delegates and services, please
visit our web site at www.campaigners.com.
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Direct
Marketers at a Crossroads
By ChannelMedia Staff
Sales are falling and profits are slim for direct marketers of PCs
and related products. Our guess is that we will see some level of
consolidation in this space sooner, if not later. Perhaps this is
not surprising given the state of the economy and the overall sluggishness
of PC's and many former red-hot product categories.
PC Connection is a case in point. Sales at the former powerhouse were $273.1 million for
the three months ended December 31, 2001, compared to $345.1 million for the matching
quarter 2000. Net income for the quarter was $1.4 million, compared to $5.5 million in
the matching quarter in 2000. Annual sales were $1.18 billion, compared to $1.45 billion
for the year ended December 31, 2000. Net income for the year ended December 31, 2001 was
$7.2 million compared to $31.5 million. Koppel commented Notebooks continued to be the
Company's largest product category, accounting for 20.5% of net sales in the fourth quarter
of 2001 compared to 22.3% of net sales for the corresponding period a year ago. Desktop and
servers accounted for 11.8% of net sales in the fourth quarter of 2001, compared to 14.1% for
the corresponding period a year ago. Computer systems average selling prices decreased 17%
in the fourth quarter compared to the corresponding period a year ago and 6% compared to the
third quarter of 2001. Gross profit margin as a percentage of net sales was 10.9% in the
fourth quarter of 2001, compared to 10.8% in the third quarter of 2001, and 11.9% in the
corresponding period a year ago.
Ken Koppel, Chief Executive Officer of PC Connection. said, "Federal government sales
were again a highlight of the quarter, while weak demand from business and consumer
markets led to disappointing results in the fourth quarter. Although we saw some slowing
in the rate of sales decline for the commercial and consumer segments during the quarter,
we anticipate that demand will continue to be soft, at least through the first quarter
of 2002."
Meanwhile, on the other side of the country PC Mall reported net income of $2.2 for its
recent quarter. Sales for the quarter increased by 2.3 percent from Q3 2001 to $176 million,
but declined from sales of $198 million in Q4 2000. The decline in Q4 2001 sales from a year
ago reflects changes in the economy. For the year 2001, the Company earned $4.5 million.
Sales for the year 2001 were $718.1 million compared with sales of $818.6 million for the
year 2000. The decline in sales is attributable to the impact of the September 11th tragedy,
discontinuation of aggressive advertising campaigns for eCOST.com that occurred during the
first half of 2000, and the challenging economic conditions in 2001.
Frank Khulusi, CEO of PC Mall, said, "This quarter is our fifth consecutive profitable quarter
and we were able to produce strong results despite the worst economic conditions in a decade."
Khulusi continued, "Sales during the first two months of the quarter were significantly off prior
year's levels, a trend that started directly after the September 11th attack. However, sales
for the last month of the fourth quarter rebounded close to the prior year's levels, consistent
with the trend experienced in Q3 prior to the attack."
Consolidated Q4 sales increased 2.3 percent sequentially from Q3 2001 to $176 million, but
declined by 11.4 percent from last year.
At PCC sales from catalogs are falling like a rock and everyone is developing new programs,
like customer management programs that combine direct sales strategies that leverage database
and Internet technologies. Koppel pointed out that PCC's ‘Managed Account Program' accounted
for 79% of total net sales for the three-month period ended December 31, 2001, compared to 76%
for the corresponding period a year ago. Average order size for the three months ended December
31, 2001 was $1,061 compared to $1,102 in the corresponding period a year ago and $1,259 in the
quarter ended September 30, 2001. As of December 31, 2001, the number of Outbound Sales Account
Managers totaled 464, compared to 496 at September 30, 2001.
At PC Mall, outbound sales to businesses increased 6 percent sequentially but consumer-focused
catalog sales were responsible for most of the decline in consolidated sales from the same quarter
a year ago. Catalog sales dropped 13.9 percent for the quarter from the same quarter last year.
eCOST.com sales remained unchanged from the comparable quarter in 2000, while eLinux had a
year-over-year Q4 increase of 17 percent. The Company remains committed to its outbound business
sales initiative. During Q4 2001, the Company continued to emphasize recruiting and training of
Outbound account executives and enhancing its Outbound sales support capabilities. Outbound headcount
rose 13 percent during Q4 2001 from Q3 2001, an 11 percent increase over Q4 2000. Increased emphasis
on networking, servers, storage and licensing product sales contributed to a 24 percent increase in
server sales and a 5 percent increase in enterprise storage sales for Q4 2001 compared with Q3 2001.
At PC Mall's eCOST.com and eLinux subsidiaries improved their quarterly operating results from the
prior quarter and a year ago. eCOST.com reported a 9 percent sequential increase in sales in Q4 2001,
and reported a small profit, an improvement of $0.2 million from Q3 2001. Compared with Q4 2000,
eCOST.com sales were flat and results improved $0.4 million. For the year, eCOST.com reported income
from operations of $0.4 million compared to a loss from operations of $9.4 million in the prior year.
eLinux reported a net loss of $0.1 million in Q4 2001 compared with a net loss of $0.2 million in Q3
2001 and $0.3 million in Q4 2000. Net sales for eLinux increased 22 percent over Q3 2001 and 17 percent
over Q4 2000.
PC Mall's cash position remained strong throughout the quarter. For the year, cash flow from operations
was $14.9 million and resulted in a 70 percent increase in working capital from the comparable period a
year ago. Cash at the end of the quarter was $10.0 million, and borrowings on the working capital facility
were $1.6 million reflecting net payments of $15.8 million during 2001.
Finally, our third representative direct reseller, Zones Inc., recently posted a net loss of $124,000 for
the fourth quarter of fiscal year 2001 compared with net income of $96,000 for the same quarter a year ago.
For the year ended December 31, 2001, the Company improved its results from operations by $1.3 million over
the 12-month period ended December 31, 2000, and reduced its net loss to $185,000. Firoz Lalji, President
and CEO of Zones commented, "We have navigated through 2001 amidst a technology spending recession, concurrent
with the completion of our transition to a new business model. Our focus this quarter was to increase gross
profit margins, maintain tight control over our expenses, and to appropriately scale the Company to the market
conditions." Lalji continued, "through the hard work and relentless commitment of Zones team members, we are
poised for profitability as IT spending improves in the latter half of 2002." Zones said that sales from its
outbound division was $85.2 million in the fourth quarter of 2001, and was $430.1 million for the year ended
December 31, 2001. The division's revenue increased as a percent of total net revenue for the twelve-month
period ending December 31, 2001 to 79.5% from 70.6% in the comparable period of 2000. The increase is a result
of the Company's deliberate shift towards the SMB and enterprise market.
Sales of desktops, notebooks and servers as a percent of total net revenue were 38.8% in the fourth quarter of
2001. Net revenue from sales of hardware and software in the fourth quarter of 2001 represented 47.5% and 13.7%
of total net revenue, respectively. The Company's focus on growth technology product lines saw year over year
increases as a percent of total revenue. Servers, as a percentage of total revenue, increased to 5.7% for the
three months ended December 31, 2001 compared to 5.4% in the prior year. Licensing and networking equipment
revenues, as a percent of total revenue, increased to 7.4% and 5.2%, respectively, for the fourth quarter of
2001, compared to 3.2% and 4.9%, respectively, in the same quarter of the prior year.
Gross profit margins were 10.3% in the fourth quarter of 2001, a sequential increase from 10.1% in the third
quarter of 2001, and a year over year increase from 9.9% in the fourth quarter of 2000. This increase in gross
profit margin percentage has been primarily due to gross margin initiatives which include a gradual shift in
revenue mix to higher margin products including supplies and accessories, taking advantage of early pay
discounts, and a shift to a more profitable customer mix. However, gross profit margins as a percent of sales
may vary on a quarterly basis due to vendor programs, product mix, pricing strategies, customer mix, and
economic conditions.
The Company's balance sheet remained strong at the end of the quarter with a cash balance that grew to
$13.1 million from $7.3 million at September 30, 2001. The Company continued to utilize its cash position
to take advantage of favorable discount terms offered by certain vendors. Working capital increased to
$19.3 million at December 31, 2001 from $19.2 million at September 30, 2001. Additionally, there were no
line of credit borrowings outstanding on the Company's credit facility at the end of fourth quarter 2001.
"The strength of our balance sheet reflects company-wide tightened controls. We have increased inventory
turns to 24 times annually, compared with the September 30, 2001 annual turn rate of 23 times. Net inventory
decreased to $16.9 million, open account trade receivables declined to $27.5 million, and accounts payable
declined to $38.0 million as of December 31, 2001," cited Ronald McFadden, Senior Vice President and Chief
Financial Officer. "As we enter 2002, we continue to look for areas of improvement in our working
capital management."
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of page)
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The
Docking Station is Winning the Megapixel War
By Amy Wiyninger, ARS Research Analyst, Digital Cameras
awiyninger@ars1.com
Voice activated dialing for cell phones,
OnStar's instant navigation for the road, and Caller-ID for added
privacy each have made life much easier in the new millennium. Today,
consumers want ease-of-use, especially when it comes to tech gadgets,
and digital cameras are no exception. The technology for digital cameras
continues to grow and expand into new areas; digital cameras are now
built into cell phones and MP3 players, and printers are combined
with cameras as two-in-one devices.
As the digital camera market developed, the megapixel war began, which
was a race between manufacturers to see who could announce the first
three, four, and five-megapixel camera, and we are now waiting for
the announcement of the first consumer level six-megapixel camera.
However, more megapixels are not necessarily what most people want
in digital cameras. Many people just now understand the advantages
of digital cameras compared to film cameras, and the concept of installing
software, connecting cables, and figuring out how to download images
is still very foreign to the average consumer.
Undoubtedly, consumers want a camera that is easy to use from start
to finish. With so many steps required to use a digital camera, the
easier those steps are, the better the outcome is. Just taking a picture
through a point and click process is likely enough for the average
user. Therefore, figuring out the flash, white balance settings, compression,
shutter speed, and focusing the camera are often added burdens to
the average consumer. Additionally, capturing the image is just the
beginning--now the user faces the daunting task of what to do next.
Consumers must figure out how to download the appropriate software,
make sure the interface is correct, connect cables from the camera
to the computer or media card reader, find the images on the computer
once downloaded, figure out how to use the editing software to remove
redeye, etc., etc., etc. Meanwhile, the battery on the camera dies
and needs recharging. Anything to ease the headache and confusion
of the digital imaging process is welcomed by consumers.
A few camera manufacturers have responded to this need by offering
a docking station. A docking station is designed to be a simple process
for downloading images from a camera and recharging the product's
battery. For example, with Kodak's docking station, users place the
camera on the dock, push a button, and the pictures are automatically
transferred to the computer. Hewlett-Packard has gone a step further
with its docking station in that an additional step was added to the
process. Through the use of a docking station, users can choose one
of many specific destinations for individual images directly from
their camera. By placing their camera on the docking station, images
can be sent straight to a file, emailed to friends, or even to a printer
for "instant" printouts. Fuji currently offers two cameras with docking
stations, the FinePix 4800 and 6800, that offer consumers a simplified
process of transferring images. Kodak launched a line of five EasyShare
cameras with optional docking stations, and Hewlett-Packard recently
joined the bandwagon with the announcement of its new PhotoSmart 812
just last month.
It appears as if ease-of-use and docking stations are winning the
hearts of consumers. During November, reports indicated that, for
the first time ever, Kodak led the nation in monthly unit sales of
digital cameras. Typically, Kodak has occupied a spot between number
two and four in camera sales, with Sony historically holding the number
one spot. Part of Sony's past success in the digital camera arena
was due to the easy-to-use, and familiar, floppy disk of the Mavica
line. Many were willing to pay up to a $200 premium just for that
feature, which was an early indicator how important ease-of-use is
to consumers.
Not only did Kodak respond to customers' needs of simplicity but the
company also priced its latest array of EasyShare cameras very competitively.
Kodak currently offers the lowest priced 3-megapixel camera available
in retail, the DX3700, which carries a $279 price tag. The combined
price of the camera and docking station is $358, making the camera
both affordable and appealing. Fuji also offers a 3-megapixel camera
with a docking station. While the Fuji feature set is more advanced
than Kodak's, the $699 price tag is considerably higher. Hewlett-Packard
recently announced its first 4-megapixel camera and first docking
station for $599 and $79, respectively. This move by Hewlett-Packard
demonstrates that manufacturers also recognize the fact that consumers
are looking for a good quality, affordable, and easy-to-use camera.
In the timeless technological race to offer more pixels, dots, and
speed, digital camera manufacturers have finally taken the first step
in responding to the true need of consumers - ease-of-use. Kodak's
triumph in November is an essential signal to the entire industry
that the recipe for success combines competitive pricing, advertising,
and possibly most importantly-- an easy to use camera!
Bio: Amy Wiyninger is the Digital Camera Research Analyst in the Digital
Imaging Group at ARS. Before moving into this position, Amy tracked
the imaging market in the area of Personal Color Printers/MFPs. Prior
to joining ARS, Amy attended the University of California, San Diego
where she earned her Bachelors degree in Psychology.
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Retail Digest
By ChannelMedia Staff
Toys "R" Us plans to close 37 Kids "R" Us stores and 27 non-Mission Possible
format Toys "R" Us stores and eliminate 1,900 store and headquarters. Toys is doing this to increase free
cash flow in 2002 and yield improvements to pre-tax earnings of approximately $25 million in 2002.
Digital River reported revenue of $17.7 million for the quarter ended December 31, representing an
increase of 76 percent from matching quarter of the year prior. Net income prior to goodwill amortization
and acquisition related costs were $1.1 million. This marks Digital River's first full quarter of profitability
on that basis.
CompUSA and Protocall have entered into an agreement to begin testing Protocall's updated SoftwareToGo(R)
electronic software delivery system. The system is expected to be rolled out to select CompUSA stores in
the first quarter of 2002. SoftwareToGo is the first electronic software delivery system designed for the
retail selling floor. Protocall Technologies developed the system in response to the shrinking shelf space
available for boxed software, which limits the number of titles retailers can make available to consumers.
CompUSA will be the first retailer to test the modified system, which has reduced the customer wait time for
finished CDs by half, to under three minutes on average. Office Depot and The WIZ have already tested the system.
"When we can offer a virtually limitless number of titles to our customers without increasing store shelf space
through the SoftwareToGo product, we think it's a win-win solution," said Larry Mondry, CompUSA's Chief
Operating Officer.
BUY.COM was the fastest retail Web site for the month of December according to measurements performed
by Keynote Systems, Inc., the worldwide leader in Internet performance services. BUY.COM took top
honors for the month with its home page loading at an average speed of .54 seconds. During a holiday
season that saw a 50% increase in traffic and a 15% increase in online spending over last year, BUY.COM
outperformed the likes of Amazon (ranked 44th), Best Buy (ranked 16th) and Wal-Mart (ranked 38th).
"Keynote's findings only prove to our customers and critics that we are one of the best online retailers
around," said Scott Blum, BUY.COM's CEO.
"We're glad to see that there are entities like Keynote Systems keeping the public informed. We want people
to know that when they come to BUY.COM they're getting a great shopping experience. It beats waiting in
line at the stores!" Performance is the average time in seconds the URL took to completely download.
Availability is the percentage of requests made that resulted in the main page being properly downloaded.
Making technology services as easy to purchase as a box of software, Gateway, recently debuted a variety
of online training, tech support, Web site and e-commerce plans that can be bought as retail packages at
Gateway stores. Depending on the service, packages may include a detailed manual, simple step-by-step
instructions on getting started, and if applicable, a pre-paid calling card or an enrollment key that
activates their order.
"When it comes to purchasing something intangible like a service, customers tell us they want to talk to
someone in person and see demonstrations of the service -- in essence, to see and touch what they're buying,"
said Jim Jones, vice president of segment marketing at Gateway. "Our stores give people the opportunity to
do all of that, and packaging services in this manner complements their technology buying experience."
Nintendo has announced a global price drop for its best-selling, hand-held video game wonder Game Boy(R)
Advance, effective Feb. 1, 2002. In the U.S., the new suggested retail price is $79.95, representing a
20-percent decrease. This simultaneous global price drop is the result of production efficiencies and
decreased component costs.
HAHT Commerce, a provider of chain management applications, said it has acquired channel management
vendor iMediation and content exchange vendor ArcadiaOne, which was acquired by iMediation in November.
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New Trends at Retail
By Diane Lowe Archer
Have you been in a Circuit City or CompUSA lately? If you have,
you've no doubt noticed the large display featuring America Online (AOL). If you're a vendor,
other than wondering, "Wow, what did AOL have to pay to get that?!", did you give it any more
thought? You should, because it's part of an overall trend that is bound to get bigger. And,
especially, if you are a provider of any Web-based or other digital service, listen up!
How does a behemoth like AOL benefit from exposure at retail when they are already dominant
online? It's all about getting in front of more prospective customers, more frequently. The
fact that the service is not actually delivered via the retailer does not preclude retail
from being a valuable sales channel.
Services need to continually focus on customer acquisition, retention, and upgrade. Retail
is the perfect venue to support all three.
Customer Acquisition
Millions of prospective customers may never stumble upon a particular Web site, but they walk
into retail stores every day. Even AOL isn't relying entirely on customers finding them online.
According to ISP-Planet, market data shows that AOL has about 24% market share of U.S. Internet
Service Provider (ISP) subscriptions, which means that there's still 76% that they can gain. By
all observations, retail is becoming a bigger part of their mix to reach more new customers.
Customer Retention
Web-based services, such as AOL, tend to be either subscription or individual transaction oriented.
While the level and value of service provided is key to retaining a subscription-based customer,
visibility at retail can help the service provider stay top of mind with current customers,
contributing to perceived value. For services that are transaction oriented (for example, digital
photo services like Snapfish or Shutterfly), a retail presence can be a valuable reminder to previous
customers to use the service again, reinforcing a previous positive experience.
Customer Upgrade
You might think that the easiest way for a service provider to upgrade its current customers to a
new offering is by directly soliciting existing customers. After all, they already have a relationship
with the customer. Sending email or stuffing an insert in monthly bills has been used with some success
to increase sales and shouldn't be overlooked as one option. But, some customers are like me they just
don't notice any of that stuff. Once the email is deleted or the mailer tossed, that's frequently the end
of the visibility.
Quick check — how many of you know all of the services offered by your phone company? What if add-on
phone services were presented to you at retail? You'd see them each time you walked into the store, while
you're in a shopping frame of mind. Hey maybe one of those times you'd even buy one. To circle back to
AOL, their aggressive retail initiative is focused on AOL Broadband, a service upgrade for the vast majority
of their members, so even though AOL promotes upgrading to broadband access online, they believe that retail
exposure will help them present a more compelling offer, more quickly and effectively to more customers.
As it turns out, AOL isn't the first digital service to be promoted at retail. Over the past couple of years,
many retailers have started to embrace services. Cellular phones and the associated service have become
ubiquitous, as have satellite television services. Along with AOL, other broadband suppliers are also appearing
at retail.
Can other digital services be far behind?
About the author: Diane Lowe Archer is the President and CEO of
At Your e-Service, a publisher of Web-based applications and services
for businesses and consumers. At Your e-Service distributes and
promotes e-services for companies interested in selling to a mainstream
audience through high volume resellers. Diane can be contacted at
darcher@atyoureservice.com.
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here to fill out our survey
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No More Dog Food
By Steve Cross, President, The Cross Channel Group, Inc.
How many times have you heard somebody say, "Let's see if
the dogs will eat the dog food", or "It's time we ate our own dog food"? It's supposed to
be some sort of cute thing to say when you are describing; a) your customers, b) your
products, or c) yourself.
People in our industry have been using this saying for years, and I am sick of it. It
isn't cool, or fun, or hip. It's just dumb. To tell you the truth, I don't want to describe
customers as dogs eating dog food. It's the kind of "ironic," phony-sounding, contemptuous
description that isolates us from our customers. It objectifies them, and takes away our
clarity of thinking about their needs and buying behaviors. And what does it say about
our products?
It's great to see how technology products have entered the mainstream, especially for those
of us who have been around for a while and remember when this stuff was only sold to technologists
(I started out selling keypunch machines, for crying out loud). But let's leave the dog food to
the packaged goods industry. They actually do make dog food. It's a product that real dogs eat,
and they seem to like it just fine. In our industry we make terrific, cool new products that impact
the way people live, work, or play innovative, fun, neat stuff. We don't make dog food.
Steve Cross works with mid-sized high tech companies to evolve their businesses. He was formerly
sales vice president at Connectix.
Contact: steve@crosschannel.com.
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of page)
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Find
profit dollars and just maybe "The Next Big Thing"
You've been searching high and low for that extra boost to the bottom
line and just can't quite find it. Consumer Products Testing can! CPT Inc., founded in 1996, puts
products on retail shelves in a no risk/high reward environment. What they do is turn a "no way" or
"maybe" into limited time tests. "We take the risk out of going chain wide," says Paige LaBelle,
President of CPT. "In the process we find hot new products and make them successful."
CPT has provided its winning formula to CompUSA for 5 years now. They act as the agent for new
vendors that just don't quite have the experience or the dollars to risk everything to get in
the door. "Typically we put vendors who are new to the channel into the testing program. Big or
small there is a learning curve," said Paige. The program is very simple. The product is tested in
groups of stores that make sense based upon a retailer's total number of stores. CPT identifies
products and vendors then offers the 6-8 week tests. Fees start at under $10k.
"Typically, the test products are displayed in-line with similar products. There is no advertising
and the vendors have no idea which stores their product is being tested in" Paige stated. "That way,
the product succeeds on its own merit."
At the end of the test period all product remaining is returned. The results are made available to
all parties. The retailer can then make a decision on the future of the product in their stores.
A portion of the testing fees is shared with the retailer regardless of the outcome. Vendors are paid
for their sell-through.
Contact Paige LaBelle at CPT for more information or to schedule an appointment. CPT is a division of
Global Marketing Partners of Woodland Hills, California. 818-713-2700
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Know
thy Audience
By Rob Gelphman, President, Gelphman Associates
In difficult economic times such as these, the need for
an organization to focus its marketing and sales efforts is extremely critical. It is
a time when marketing and sales should get back to basics and streamline its endeavors
so that those audiences that are of most relevance to the long term health of the company
are continuously informed and inspired to action. However, this requires definition and
analysis of target markets that may yield some surprising results and may even suggest
entirely different strategies for reaching them.
Let's start with the most obvious audience first, the customer. The customer can be
basically categorized into one of two groups. The first customer category is obvious.
This is the traditional customer, the kind that buys the company's product or service.
The other type of customer is the one that is not always so apparent. This is the
shareholder. For a publicly held corporation, and privately held as well, these are
the folks, individual and institutional, that own equity in the company. They both buy
a company's products, one is the tangible, manufactured product and the other is the
company itself. Both are customers as both have a stake in the organization's ongoing
health and well-being.
There are numerous other audiences that often must be activated during or as a result of
the marketing and sales process. Many have their own special needs, agendas and quite
possibly communications styles for receiving, sending and sharing information.
Too often overlooked is corporate management and employees. Management needs to be informed
not only for buy-in but as they are often the spokesman for the company, on the record and off.
Sometimes the best salesperson for the company is the CEO. Employees, especially marketing and
sales but not only, are involved in ongoing dialogue with customers, suppliers and partners and
what they say directly should mirror and support what the customer is hearing and experiencing
from the other communications channels. It is amazing how many times companies forget that
sometimes the first and best ambassador with the outside world is the receptionist. The media is
a hybrid customer, too. They consume the information, process it and diffuse to the greater,
though still targeted, audience. This also makes them an information channel not unlike the sales
channel for selling goods and services.
The investment/financial community is more prescient than ever and should not be overlooked even if
private. Very often now, marketing and communications campaigns are structured for reaching the
investment community even though a company is in its embryonic stages. People with money to invest
want to know. They trade on information. Prospective new hires are an audience, though speculative
and difficult to identify by definition. How can you reach someone you may want to hire whom you do
not know? Again, continued and active presence in select and specifically channels that reaches these
people serve as a valid and credible demonstration attesting to the organization as a successful and
progressive company. After all, who doesn't want to work with a dynamic, visible company?
Even a company's other vendors are a critical audience as they want to have assurances in their client
and are most effective when their efforts are merged with those of the larger corporation. It is the
inefficient marketing program that aims for a general audience. Communicating to a general public, by
definition, is compromised in the name of reaching a common denominator. Nor can it be measured properly
as money and time (even more valuable) will be spent on chasing people who aren't relevant to the organization.
Knowing your audience is critical in good times and bad. In the latter, budgets are tight and money and
time cannot be wasted on those who "might" buy your product or "may" be interested. Tough economic times
require focus on the most important audiences who will help elevate the company's visibility, credibility
and value. It is equally true during the good times.
For comments or questions please contact 408/451-8420 or robert@gelphman.com,
www.gelphman.com.
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