Suvigna Shour’s Post

When you're a young brand launching/expanding in offline retail, it is always preferred to choose retail first (vs chasing wholesale). Why? First, some definitions. Wholesale: Stores that buy your product in bulk at a high discount (50-70%) and resell to retailers. Retail: Stores that buy your product in limited quantities and serve end consumers, often at significantly lower margins than wholesale (25-30%). 1) Brand Control: Retail distribution allows FMCG companies to have more control over their brand's presentation on store shelves. They can ensure that their products are displayed prominently and in line with brand image and marketing strategies. 2) Customer Interaction: Retail distribution allows for direct interaction with end customers. Helps build insights into consumer preferences, buying behavior, and trends, which can be used to tailor products and marketing efforts more effectively. 3) Pricing Control: FMCG companies can have better control over pricing in retail distribution. They can set the price at which their products are sold to consumers, which can be critical for maintaining price consistency and brand image. 4) Product Innovation: Retail distribution allows FMCG companies to quickly introduce new products or variations based on consumer feedback and market demand. Agility is good for young brands. 5) Brand Building: Retail distribution can be an essential component of building and strengthening a brand's presence. It allows companies to showcase their entire product range and build brand loyalty among consumers. 6) Marketing and Promotion: FMCG companies can implement marketing and promotional strategies directly at the point of sale in retail distribution. This includes in-store displays, promotions, discounts, and product demonstrations. 7) Consumer Data: Retail distribution channels provide access to valuable consumer data, which can be used for targeted marketing campaigns, product development, and demand forecasting. 8) Seasonal and Regional Variations: FMCG products often have seasonality and regional variations in demand. Retail distribution can help companies tailor their product assortment and stocking levels based on local and seasonal preferences. 9) Product Freshness: For perishable FMCG goods like food items, retail distribution allows companies to ensure product freshness and quality control directly to the end consumer. 10) Bargaining Power: A store's contribution to your business dictates his bargaining power. Even if you get it right, versus retail, an average wholesaler contributes more (in percentage sales) and hence holds much higher bargaining power. However, it's important to note that retail distribution also comes with challenges, such as the need for a strong sales and distribution network, higher operational costs, and competition for shelf space. ofScale enables challenger brands to reach offline retail stores without the need of a large sales & distribution network, cost, or complexities.

To increase the weighted distribution (WD) of fast-moving consumer goods, consider these practical approaches: *Targeted Store Placement* Identify high-traffic locations and strategically place your products there for maximum visibility and accessibility. *Effective Merchandising* Optimize product displays by using eye-catching signage, shelving arrangements, and end-cap displays to attract shoppers' attention. *Strong Retailer Relationships* Build strong partnerships with retailers to ensure consistent availability and prominent shelf space for your products. *Supply Chain Efficiency* Streamline your supply chain to minimize out-of-stock situations and ensure a continuous flow of products to retailers. *Promotions and Discounts* Offer occasional promotions, discounts, or bundle deals to incentivize both retailers and consumers to stock and buy your products. *Innovative Packaging* Use packaging that stands out on shelves and clearly communicates the product's benefits to shoppers. *Consumer Insights* Leverage market research to understand consumer preferences and tailor your products to meet their needs and desires. *Digital Marketing* Utilize social media, online advertising, and influencer collaborations to create buzz and drive demand for your products. *Sampling Programs* Offer free samples in-store or during events to allow consumers to experience your products firsthand. *Effective Distribution Network* Optimize your distribution network to ensure products reach retailers promptly and efficiently. *Continuous Monitoring* Keep track of sales data, stock levels, and competitor activities to adjust your distribution strategies accordingly. *Training for Retail Staff* Educate retail staff about your products' features and benefits, enabling them to recommend and promote your items effectively. *Localized Marketing* Tailor marketing campaigns to suit the preferences and cultural nuances of different regions. *Product Innovation* Regularly introduce new variants or limited editions to keep consumers interested and coming back for more. *Feedback Loop* Encourage and gather feedback from retailers and consumers to improve your products and distribution strategies over time. Remember, a combination of these strategies, adapted to your specific market and product, can help you increase the weighted distribution of fast-moving consumer goods effectively.

Balancing promotion planning in retail is no small feat. It involves countless variables, each influencing consumer behavior and outcomes differently. The challenge multiplies with every promotion you run, straining the capacity of any planning team. This article dives into the intricate world of retail promotions and how technology like Predictive Analytics and AI can revolutionize the process. Promotion Goals & Retail KPIs: - Promotions must align with your company’s business goals, whether focusing on boosting sales, driving traffic, winning market share, raising awareness, or enhancing vendor collaborations. - Each type of promotion serves a specific purpose, from percent discounts to BOGO offers and financing promotions, all impacting customer perception and behavior uniquely. Sales Promotion Examples: - Percent discounts are effective for lower-priced items, while dollar discounts resonate more with higher-priced products. - BOGO offers and Multi-Buy promotions influence customer purchasing decisions by offering extra value. - Rebates, financing promotions, free samples, contests, and bundling are additional strategies to drive store traffic and increase sales. Challenges with Promotional Success: - Despite meticulous planning, internal and external factors can jeopardize the effectiveness of promotions, leading to unexpected outcomes and lower-than-forecasted ROI. - Consumer psychology, seasonality, assortment depth, vendor lead times, and numerous other variables introduce unpredictability into promotion planning and inventory management. AI and Predictive Analytics in Retail Promotions: - Retalon’s promotion optimization software leverages AI and predictive analytics to forecast true demand and recommend the best promotion strategies. - By analyzing SKU-by-SKU and store-by-store data, Retalon’s solution provides insights into the impact of promotions, inventory levels, cannibalization, and more, enhancing decision-making and ROI prediction. Optimize Your Promotion Strategy: - Retailers across various verticals trust Retalon to refine their sales promotion strategies and streamline inventory management, integrating seamlessly with existing systems. - Requesting a demonstration of Retalon’s software with your own data allows you to witness firsthand how AI and predictive analytics can revolutionize your retail promotions. https://lnkd.in/gQujTxHC

The Power of In-Store Demos and Store Audits: Elevating Your Brand's In-Store Presence In today's competitive retail landscape, in-store demos and store audits are not just optional add-ons; they're essential tools for building strong buyer relationships and ensuring your products stand out on the shelves. At Natural & Organic Marketing, we understand the critical role these services play in your brand's success. In-Store Demos: There's no better way to engage customers and showcase your product's unique qualities than through hands-on experience. In-store demos provide a direct interaction with consumers, allowing them to taste, touch, and understand the benefits of your product firsthand. This personal connection often leads to increased sales and brand loyalty. Store Audits & Merchandising: A well-executed store audit can make a significant difference in how your product is perceived and sold. From verifying shelf tags and promotional displays to ensuring adequate stock levels, our audits help maintain your brand's visibility and consistency. Additionally, merchandising strategies ensure your product is optimally placed to attract shoppers' attention, enhancing its chance of purchase. Why It Matters: Effective in-store marketing strategies like demos and audits not only improve customer engagement but also build stronger relationships with store buyers. By showing your commitment to maintaining product quality and presence, you can foster trust and encourage better cooperation for future promotions and stock ordering. For a deeper dive into the benefits of in-store demos and store audits, check out our full blog post on our website. Discover how these services can be game-changers for your brand's growth and success. [Follow the link below for the full blog post...] #InStoreMarketing #BrandActivation #RetailSuccess #NaturalProducts #OrganicProducts #CPGMarketing #StoreAudits #Merchandising #CustomerEngagement #BrandAwareness #RetailStrategies #DemoMarketing #NaturalAndOrganicMarketing

Leveraging Private Labels for Retail Success: In the dynamic retail landscape, private labels, like Milsani, Gut & Günstig, and Balea, have become ubiquitous across diverse product segments. Through an examination of the private label concept, differentiation from manufacturer brands, and a critical analysis of success stories, this article provides valuable perspectives for marketing professionals. Private labels, or store brands, have proliferated in retail, finding representation in supermarkets, drugstores, and even pharmacies. A private label refers to a product or product line owned by a retail company, exclusively distributed within its establishments. Private labels offer control over pricing strategies, historically contributing to their success. Retailers can shape pricing policies independently, providing flexibility in entering the price-sensitive market segment. The autonomy to choose manufacturing partners, dictate supply chain dynamics, and determine order quantities empowers retailers to optimize production and delivery costs. This, coupled with the inherent quality of private label products, creates a compelling value proposition for customers, fostering demand and ensuring a substantial profit margin. Distinguishing From the Competition Private labels differentiate retailers from competitors. In an era marked by numerous retail options and the rise of online shopping, customer retention becomes paramount. Private labels offer a unique opportunity to stand out by allowing retailers to independently manage branding, packaging, and the communicated image. This strategic control facilitates precise targeting of desired customer demographics, aligning the private label seamlessly with the retailer's overall brand identity. Driving Product Innovation Private labels empower retailers to drive product innovation, especially in areas where manufacturer brands may fall short. Many retailers have successfully introduced private label products focusing on trends such as organic, vegan, or regional offerings. This innovative approach differentiates retailers from manufacturer brands and provides customers with genuine value beyond what established brands offer. In a 2022 study REWE emerged as a clear winner, securing the title of "Best Private Label" in four product groups with "Rewe Regional." The study also recognized ALDI SÜD for the popularity of its "GUT BIO" as the best bio private label and "Gourmet" as the preferred premium private label. In conclusion, the strategic adoption of private labels emerges as a potent tool for enhancing the market position of retailers. The ability to boost profit margins, differentiate from competitors, and drive product innovation positions private labels as a multifaceted approach to success in a highly competitive retail landscape.

From our blog... The Power of In-Store Demos and Store Audits: Elevating Your Brand's In-Store Presence In today's competitive retail landscape, in-store demos and store audits are not just optional add-ons; they're essential tools for building strong buyer relationships and ensuring your products stand out on the shelves. At Natural & Organic Marketing, we understand the critical role these services play in your brand's success. In-Store Demos: There's no better way to engage customers and showcase your product's unique qualities than through hands-on experience. In-store demos provide a direct interaction with consumers, allowing them to taste, touch, and understand the benefits of your product firsthand. This personal connection often leads to increased sales and brand loyalty. Store Audits & Merchandising: A well-executed store audit can make a significant difference in how your product is perceived and sold. From verifying shelf tags and promotional displays to ensuring adequate stock levels, our audits help maintain your brand's visibility and consistency. Additionally, merchandising strategies ensure your product is optimally placed to attract shoppers' attention, enhancing its chance of purchase. Why It Matters: Effective in-store marketing strategies like demos and audits not only improve customer engagement but also build stronger relationships with store buyers. By showing your commitment to maintaining product quality and presence, you can foster trust and encourage better cooperation for future promotions and stock ordering. For a deeper dive into the benefits of in-store demos and store audits, check out our full blog post on our website. Discover how these services can be game-changers for your brand's growth and success. [Follow the link below to read the full post...] #InStoreMarketing #BrandActivation #RetailSuccess #NaturalProducts #OrganicProducts #CPGMarketing #StoreAudits #Merchandising #CustomerEngagement #BrandAwareness #RetailStrategies #DemoMarketing #NaturalAndOrganicMarketing

Companies (rightly) focus a lot on gross margin. The better the gross margin the more they can invest on story telling, product development and people. Lowering the cogs is the most evident lever to improve gross margin, but it has its limits if we don’t want to compromise product performances and quality (and ESG criteria). Then there is the pricing, but also this one has its limits depending on brand/category price elasticity at the specific point on time. Yet, there could be more levers! Unless you manage a pure DTC brand, between retail price and cogs there are other elements that can be acted upon. In fact, it all depends on the distribution model. The more intermediaries are between the ultimate shopper and the brand the lower is the gross margin (both in absolute and %). Thus, a change in distribution model could either improve or negatively impact the gross margin. This is visible in the gross margin evolution over time of Interparfums. They have been consistently improving gross margin, yet the biggest improvements come from the move from distributor partners to own affiliates (Europe in 2007 and USA/Asia in 2010/2011). This change has led the gross margin from 55.2% in 2006 up to 62.3% in 2011! The further improvement up to 63.7% in 2023 is driven by a mix of interventions from cogs optimization, to price increases, and especially mix of brands/products/countries. A couple of watchouts: - The examples in the table are based on arbitrary numbers and are meant only to give a rough idea of the differences between different distribution models. Yet there could be cases in which margins and EBITDA move in the opposite direction (depending also on development phase of the company) - The example generalizes the three main models, yet there are other/mix models, and this simulation can be even more granular and extended to each channel of distribution (e.g. perfumeries, dept stores, off-price…) in order to fine tune the overall distribution strategy. - Every distribution model has pros/cons. It might not be strategically or financially viable to move from distributors to affiliates in certain situations. DTC might be very expensive from a logistic and marketing investment perspective (especially at startup), and it might not lead to enough scale. - Tracking cogs as a percentage of Revenues might be misleading as this measure is impacted by the distribution model. A better indication is given by the cogs as percentage of retail sales. In the example here reported the slight difference in cogs between distributor model and direct-to-retail is given by logistic costs that in part are absorbed by distributors, while for DTC they are much higher due to the single delivery to each shopper. - Same watchout applies to other measures such as EBITDA. In the example here reported EBITDA%Revenues are similar but the absolute dollar value is dramatically different and so is the EBITDA%RSP. #beauty #beautyindustry #distributor #financials

Paradigm shifts in retail as major brands embrace direct-to-customer strategy

Which private label brands do you regularly buy, and which ones do you steer clear of? Private label brands have really taken off lately, thanks to shifting consumer habits and better supply chains. What used to be seen as just cheaper alternatives are now often just as good, if not better, than big-name brands. Retailers are putting more effort into making their own brands look and feel premium, focusing on quality, packaging, and clever marketing. This trend is especially noticeable in areas like groceries, clothing, and personal care, where people are more mindful of their spending and willing to try something new. I've had a mix of experiences with private label products. Whether it's clothing, household items, or groceries, I've found some fantastic options that have become staples in my shopping routine, while others were definite misses that I won't be trying again. What motivates you to give a private label product a shot? https://lnkd.in/gpQA8T7q

Introduction to Category Management Category management is a strategic method to structuring and managing product categories as independent business units, rather than addressing individual products in isolation. It includes a variety of activities like as assortment planning, pricing optimization, promotional techniques, and shelf space allocation, all aimed at enhancing the performance of each category within a retail environment. According to a study by the Global Market Development Center (GMDC), category management is described as "the process of managing product categories as separate business units and customizing them on a store-by-store basis to satisfy customer needs". This highlights the customer-centric nature of category management, emphasizing the importance of understanding and catering to diverse consumer demands. Key Components of Category Management 1.     Category Definition and Segmentation: A pivotal aspect of category management involves defining the boundaries of each category and segmenting them based on factors such as product type, consumer demographics, and purchasing behavior. This segmentation facilitates targeted marketing efforts and assortment planning tailored to specific consumer segments. 2.     Market and Consumer Analysis: Nielsen's research underlines the need of using data analytics to get insights into customer behavior, preferences, and developing trends within each category. Therefore, in order to make informed decisions in category management, detailed market and consumer information is required. 3.     Assortment Planning: Effective assortment planning is critical for maximizing category success. Research published in the Journal of Retailing and Consumer Services emphasizes the relevance of matching product assortments with consumer tastes and market demand in order to increase sales and profitability. 4.     Pricing and Promotion Strategies: Pricing and promotional activities play a pivotal role in driving category performance. According to a report by McKinsey & Company, dynamic pricing strategies and targeted promotions tailored to specific categories can significantly impact sales and margins. 5.     Merchandising and Shelf Space Allocation: Strategic merchandising and shelf space allocation are critical components of category management. A study by the Journal of Business Research highlights the importance of visual merchandising techniques and shelf space optimization in influencing consumer purchasing behavior within retail environments. 6.     Performance Measurement and Optimization: Continuous performance measurement and optimization are integral to the success of category management initiatives. Research by Deloitte emphasizes the need for real-time analytics and performance monitoring to identify opportunities for improvement and drive strategic decision-making.