Whether your brand/product is sold purely on-line, through healthcare professionals or other professional channels, retail offers an opportunity to achieve quantum growth.
Indeed, the rewards of selling through retailers can be enormous. Depending on the outlets you pursue, a successful retail launch can generate opening orders of 200,000 units or more. I recently launched a medical product primarily into the big three drug chains and Walmart that achieved that delightful opening order size.
And, appearing in front of millions of consumers on retail shelves couldn’t hurt brand awareness. Some experts estimate that retail shelf presence alone can increase brand awareness by 20% or more.
But the retail bar is high, and you must be ready to meet the requirements.
As you prepare to enter retail channels, you’ll need to have the right resources, support and expectations.
First, find yourself a sales broker/agency or hire someone experienced in selling to the targeted channels and retailers. They understand each retailer, including the time of year new products are accepted, sale terms, merchandising and much more.
As you prepare to meet and present your product to retailers, keep in mind their perspective. They own the real estate and shelf space, and they must be convinced that your product will drive revenue and profit growth for them.
They aren’t interested in products that will simply cannibalize the volume of other brands they already have on their shelves. If your one-of-a-kind, amazing product is accepted, they expect YOU to drive demand and help the item sell to consumers.
At a presentation meeting with the retailer, you will be expected to demonstrate why your product is better or different from what they offer today. Your pitch should include independent research with consumers showing a high degree of PI (Purchase Intent). If you have been selling on-line or in other channels/outlets, strong sales trends and market share can also be highly persuasive.
Be sure you have carefully created packaging that meets retailer’s shelving requirements and is appealing and impactful to stand-out on crowded shelves.
Beyond convincing them you have a great product they’ll want to know how you plan to create consumer awareness and drive demand. So, be prepared to show them your media, public relations and promotional plans, including timing and spending.
Don’t’ be surprised if retailers impose several fees, including:
Finally, pricing and retailer margins need to be carefully considered. Retailers set the retail price, not you. But you establish the sell-in price and must be aware of their margin expectations. They are often high. For example, drug stores typically operate on 50% margins (not mark-ups).
In my 30-year career that includes sales, marketing and executive management roles, I have personally introduced products from non-retail markets into new retail channels many times. In one case, we secured 30,000 new retail outlets that shipped on the very first day of product availability!
The most successful brands usually have a presence both on-line and at retail. But they are vastly different channels that have unique requirements. So, if you’re ready to make the important move into retail, give us a call and let’s see if it’s right for you.