B-to-B-to-C = tough equation

B-to-B-to-C (Business-to-Business-to-Consumer) marketing is a complicated equation. Solving consumer wants and needs, anticipating the competition’s answers, and appealing to buyers managing thousands of SKUs are just part of the formula.

The metrics of value-add

Beyond offering quality product, compelling packaging and POP, helpful product information, competitive pricing, and timely delivery, you should provide more. This may be innovative merchandising and/or promotions, market trends information, etc., and service, service, service!

It’s that new math

Retail products are not being ‘sold,’ instead they are being ‘bought’ by consumers. Branding is a more efficient way of selling products. If brands are well-developed, selling can begin before the consumer even enters the store.

Regional ≥ national

Due to competition from national chains, regional retailers are putting more demands on suppliers. Smaller chains are asking suppliers to bid on shelf space. Product consignment is putting the burden of unsold product on the suppliers. To dissuade comparison shopping, unique quantities or combinations are packaged for the regional stores.

Share your formula

Buyers often appreciate receiving merchandising plans that are tailored to their respective geographic markets. Consider population, median age, culture, etc. Each region will likely require a unique variation of inventory. This equates to better turns and bottom lines.

Show your work

Present a product/package/POP prototype to the retail buyer. They can give you immediate feedback, “go back to the drawing board, make some tweaks, or I’ll take x-number of units.”

‘Location?’…good answer!

Good location on the shelf has gotten very expensive. This can become a major portion of a supplier’s marketing expense. Retailers can command considerable fees for prime shelf space. Be sure to include this in your budget.

Brand equity earns extra credit

If you own an established brand, other suppliers may want to license it. This allows you to extend your line without risk. Brand equity takes time to build, but the better it’s developed the sooner this type of opportunity will come. In addition, the stronger your brand is, the greater respect it will receive from buyers—making it less likely to be commoditized.

Let’s see, do I multiply or divide?

Say you market an established brand of mousetrap and you want to also market cheese. Do you extend the current line or create a new brand? In this case, instead of causing confusion (is this a brand of traps or snacks?) or missing market opportunities (pets like cheese too), create a new category and own the category by being first.

Borns provides tutoring

Provide category insight that positions your company as the leading supplier and keeps your brand in the front of the buyer’s mind. Borns offers brand development and tactics for smart marketing. If you want someone to help you study, contact Randy Borns at randy@borns.com.

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The B-to-B-to-C theorem

Price, quality, delivery are givens…service and/or ideas may be what differentiates

The cost of doing business may include bidding for shelf space, slotting fees, or consigning product

Timing is everything—buying/selling seasons, purchasing decisions are made as far out as a year

Some independent reps will require Motivation 101 course work

No POP displays allowed for some retailers while special POP for others

Demand for greater margins and/or revenue per square foot of retail space

Branded products preferred over generic products

Line management expected

Test product in a few stores before full launch

Bundling of brands adds value and differentiation