The Importance of Shopper Marketing - Outsource or Not?

Last week a new customer, who is a very large, multi-state alcohol beverage distributor, was telling us how pleased they were with their new point-of-sale (POS) marketing software from OnTrak.

This new customer commented on how our products now streamline their entire process of creating marketing materials for their retail customers, while simultaneously producing timely and accurate recovery reports required by suppliers - All at the click of a mouse.

Before becoming an OnTrak customer, this distributor had been considering outsourcing their graphics production organization. They even considered creating their own at-retail promotional materials management system. They were discussing these alternatives because their previous system could not handle the expanding point-of-sale marketing demands of the business.  

Is Shopper Marketing One of Your Core Competencies?

We’re always proud and pleased when one of our customers compliments us. But, their message also reminded me that many beverage distributors, especially alcohol beverage distributors, are becoming sales and marketing organizations, not simply distribution and warehousing businesses.

Today, suppliers rely on their distributor’s marketing and sales organizations to build brands and stimulate sales.

One of the most important functions of distributors is to develop and implement shopper marketing campaigns.  These at-retail promotions are where shoppers are turned into buyers. It is apparent to both suppliers and distributors that if the goal is to increase sales, then shopper marketing provides a cost effective approach with an immediate impact.

What we call POS marketing requires much less time and financial commitments to generate a better ROI than TV and print buys.  While the latter has proven to be effective in building brand recognition, it has been ineffective in converting a shopper into a buyer. It’s only at-retail where shoppers expect to use and often actively seek promotional materials.

The power of shopper marketing is its ability to immediately provide a measureable sales lift at low cost and measurable ROI.

If Shopper Marketing is Critical to Your Business Then Why Would You Outsource It?

It’s time to take a look at your organization and determine if you consider yourself in the demand fulfillment or the demand creation business. Are you mostly a warehousing, cross-docking, transport planning, logistics and trucking organization; or are you a marketing and sales organization that also happens to provide all those supply-chain management functions?

Increasingly we hear our customers tell us they are a marketing or sales organization - Critically involved in creating demand, and then fulfilling it. These forward-thinking organizations tell us that their ability to create and place high quality marketing materials drives and increases sales.  Shopper marketing is key to distributor survival, growth and prosperity, and gives these companies a competitive advantage.

An important shopper marketing goal is to deliver POS marketing materials to customers before the competition — “Speed to market” is very important. Another goal is to create materials that are as specific as possible to the retailer — and the local environment where the materials will be placed. For many of our customers, making sure their POS materials are ethnically or language appropriate is vital to the effectiveness of the promotion.

To Sum Up:

Increasing sales with your shopper marketing campaigns requires an evaluation of your organization.

Ask yourself the question, “Are we a storage and delivery company (demand fulfillment) or are we a sales and marketing company (demand creation)?”

Once you have answered that question, you can take the next steps in aligning your promotional efforts to your type of business.

Simply put, if you consider yourself primarily a demand fulfillment enterprise, you may benefit from outsourcing the printing of your shopper marketing materials to a centralized production facility.

On the other hand, if you are a marketing and sales organization you will most certainly not want to outsource one of your core business functions — for this is a competitive advantage; the leader’s “edge”.

For more information on the Pros and Cons of Print Shop Outsourcing, click here, or call 800-513-9194.

— Mark Fullerton