A summary of what I discuss in this video is below.
I am helping a new brand come to market. Here is some background for context:
- This is a new brand with new products in the home outdoor category;
- The category sales are flat;
- This is a small category with annual sales around $1 billion;
- There is largely no product or marketing innovation in this category;
- Because the category is small and sales are flat, there is no marketing innovation and instead, messaging is very traditional that does not work on consumers like it use to.
The question: how might we interest category buyers for bringing a new brand to retail?
The general consensus from my key retail brokers is as follows:
- You have to demonstrate that your product will grow the category for the retail buyer. They won’t bring you in if you just steal sales from the competition and they won’t bring you in and remove other SKU’s just to trade sales;
- It is expensive and time-consuming to make category planogram changes so unless you provide an incentive through increased sales, they are reluctant to move;
- They will only bring you in if you are really stealing share from competitors and they need to bring you in as a defensive tactic to maintain their sales, otherwise their consumers will just buy from someone else who is carrying the product. But this may not be likely because competitors won’t go down without a fight;
- In a category with flat sales and no innovation, that fight will mean price competition, where everyone loses:
- You and your competitors lose because you are beating each other up on price;
- They retail buyer loses because sales drop;
- And while the consumer might win for a while, in the long-run, they lose because with flat sales, there is no incentive to innovate, so they don’t see new innovative products.
The lesson for us in this situation is that we should focus on product innovation and marketing innovation to not just steal market share, but also interest consumers who normally do not shop in this category.