What is the Best Way To Manage Brick And Mortar Retailers Concerns About Online Retailers

September 12, 2013

Retailers are focused on developing their omni-channel strategies to stem their bleed of sales to online retailers such as Amazon. As companies selling to brick & mortar, you need to be sensitive to these concerns and offer assortment items that don’t undermine retailer’s efforts to defend their turf. Study up on this topic. Retailers have moved beyond “multichannel” and are now focused on omni-channel as the latest “hot” topic.

To help brick & mortar retailers maintain their fair share of sales, consider:

1)      Communicating a MAP policy. MAP is Minimum Advertised Price. It’s the minimum SRP in which retailers (online included!) can advertise your product. You can even stipulate how often they are allowed to offer your product at the MAP (e.g., once every 4 months). This helps lessen the ability of online retailers (who inherently have higher margins because they don’t have to maintain the costs of stores) to undercut brick and mortar retailers.  However, this tactic alone is not enough. Not to mention, some online retailers blatantly ignore MAP policies. Not nice.

2)      Differentiating your assortment across channels.  Offering a different pack-size or count-size online versus in-stores. Maybe you offer bundles on-line and sell single-units in stores. Maybe you offer retailers the newest prints/patterns and hold older or unique styles for online retailers (or vice versa). Or offer different variants (scents/flavors/colors/patterns) altogether. Or maybe you brand it under a sub-brand name.  Get creative here. There are ways to do create different SKUs without it getting to expensive for you.

3)      Offering brick & mortar retailers coupon programs that can only be redeemed in their stores.  Offer to fund in-store marketing, POP displays, or advertising space in their circulars. These tactics are more “offensive” than “defensive” as in the case of MAP. And “offensive” tactics are more likely to have greater upside (in sales, relationship-building, etc.) than playing defense.

It’s been awhile since my last post.  But for good reason. We’ve been busy bees after recently launching Buyerly which is a platform that brings consumer brands and retail buyers together for product feedback and wholesale orders.  There are exciting things you can do on Buyerly:

Buyerly’s Product Feedback allows emerging brands to conduct market research with the retail buyers from the nation’s largest retailers to make sure their product is positioned, priced, packaged and marketed correctly for retail shelves.