Sales channels to reach your customers
Selling through retailers, wholesalers and other distributors
Selling through an intermediary may be a more cost-effective way of reaching your end-customers than selling to them directly.
If you are targeting business customers who prefer to deal with large suppliers, selling directly to them may not be a realistic option. Instead, you might aim to supply wholesalers who have existing relationships with those businesses.
If individual consumers buy low value quantities of your products, the best option might be to target retailers that sell similar products. Or you might choose to focus your efforts on a relatively small number of wholesalers who can in turn supply your products to many retailers.
Other distribution channels may also reach your end-customers. For example, technology suppliers often sell to resellers who can configure and install the technology to suit end-users’ particular needs.
Managing your distributors
You need distributors who will value your product. If they sell competing products, what will make them push yours?
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Think about how you set your prices. Distributors will be more enthusiastic if they can make a large profit – but setting too low a price will eat into your own margins.
Effective advertising and promotions can be vital. As well as marketing to the distributor, you can promote your products directly to end-customers. Distributors will be keener to stock and sell products that their customers are asking for.
The key terms of the supply relationship should be covered in a written contract. Key issues might include:
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how much stock the distributor will hold
what the distributor will do to promote your products
how quickly you can resupply and minimum order levels
whether the distributor has exclusive rights to your product (for example, in a particular territory)
what happens if either you or the distributor want to end the relationship
Business ideas, Marketing and sales , promotions and advertising ideas , articles
CASTROL’s Repositioning Excercise
Changing Trends Indian consumers today are far more passionate about their cars and bikesThey no longer look at their vehicles as a mere mode of transport but also want to maintain them wellCaring for vehicles is becoming a priority for consumersPeople don’t change brands easily, as they feel that by doing so, they are causing disservice to their vehiclerise in ownership value and pride in their car or bike, consumers are also careful about the brand of lubricant they useCastrol’s Financials: Turnover of around Rs 1,500 crore last yearCastrol’s brand strategy: “It’s more than just oil. It’s liquid engineering.”The tagline `liquid engineering’ talks about the inner strength of Castrol which enables the engine to perform betterGarage Owners to MassesMedia Agency: Ogilvy & Mather – Position Castrol as a brand that goes beyond other lubricant brands, and also brings out the emotional attachment people have towards their vehiclesOther Players: Most lubricant brands focus more on the vehicle, while we’ve tried to talk about the engineOther ChangesThe brand also sports a new logo Invested in creating a new packaging for its productsPreviously there was not much synergy between the various packs. The packs containing truck oils looked different from the car oils. But now there is more synergy between the packs and they also bring out the brand’s core propositionProducts: To fulfill the needs of a passionate biker or a car owner, the company has also rolled out a few specialised products such as Castrol EdgeTarget Audience: ultra passionate consumer who wants the best for his car Market Size: Lubricant market has registered a significant growth in value terms, but a fall in volumes. This is due to superior technology and the high-quality ingredients used in the lubricants. The market in value terms is growing by almost 7 per cent year-on-yearA truck driver who used to change the oil every 10,000 km will now do it once every 15,000 kmPromotional CampaignsAssociating the brand with a lot of youth-based TV programmes such as MTV Youth Icon and Fame Gurukul on SonyInvolved in a number of campus activities to promote its premium bike lubricant, Power OneThey sponsor rock concerts, 20:20 cricket matches and speed footballThey have tied up with cricketer Rahul Dravid and actor John Abraham to endorse the brand. But the initial campaigns will focus on the core proposition of the brand, which is liquid engineeringHope Castrol will be able to realize value from the above excercise !!
