Selective Distribution: Why Thoughtful Choices Make or Break Your Brand's Perception

Early in my career while working for Reebok, I quickly transitioned from a Tech Rep to a Sales Rep after a background check didn't clear for the new hire slated for that role. I went into a three-day sales meeting with one job and left with another.

After the sales meeting, I had a short vacation planned to visit my now wife in California and returned to Denver to find a mountain of samples and a list of new accounts in Wyoming, Colorado and New Mexico. Fortunately, part of this whirlwind job transition included a two-day sales trip with the previous Sales Rep to provide an introduction with a couple of the bigger accounts and several tips for success.

The trip took us to places like Garretson’s Sport Center in Greeley, CO and up into Wyoming to visit independent shoe stores in Laramie and Cheyenne. On the way back from Cheyenne, Mike, the Sales Rep who I was taking over from, let me know we were going to swing over to Cabela’s flagship store in Sidney, Nebraska. Mike and I were different kinds of outdoorsmen, and I wasn’t even sure what Cabela’s was at the time. I did soon figure out that Sidney, Nebraska was 97 miles each way, out of the way of where I thought I wanted to be.

The right products in the right place drive profitability and will define premium brands

The drive gave me extra time to pick Mike’s brain about the job and ask questions about each of the accounts and prepare for what to expect during the different line reviews. There wasn’t a lot to see between Cheyenne and Sidney and as the road signs notified us that we were getting closer to Sidney, I expected to start to see some signs of civilization, but I didn’t, not until we were right on top of the Upland Parkway exit did we see the Flagship store, which seemed like an oasis in the middle of the Nebraska plains. This is when I started to appreciate the power of Cabela’s.

I remember walking in and immediately getting a “Ski Lodge,” type of a feel for the building, with its vaulted ceilings and exposed beams, the space was inviting and drew me in. The merchandising was “next level,” and every single product gave an air of quality. The combined mass collection of products fueled off each other, generating consumer confidence in the total assortment Cabela's had to offer. It instilled a belief that any product you could be in search of for Hunting, Fishing or Camping, could be found at Cabela’s. This mindset also created the assumption that every product was a quality item, which was reinforced by the knowledgeable and friendly staff.

Long Term Brand Health Delivers Short Term Revenue

Cabela's created an experience that is key to their success and the success of the brands who make the products Cabela's sells. That experience first and foremost delivers to everyone's top line, but it does so much more than that.

Relationships that brands have with customers like Cabela's drive brand equity, the intangible assets associated with a brand, including its reputation, perceived value, and customer loyalty, which contribute to higher margins, customer lifetime value, and resilience against competitive threats.

Again, Cabela's is one example, and many brands have thousands of these relationships in different sizes, but the aggregate drive innovation, brand awareness, brand perception, brand loyalty, and brand consistency and are indispensable to companies as building blocks to sustained success, resilience, and growth in a competitive marketplace.

These factors will always be important and have been interwoven for years, but the shift in the retail landscape is changing how they influence consumer behavior. If everything is available everywhere, what makes the consumer shopping experience special? What drives mind share? What gets consumers excited about your brand?

Navigating the Risks to Brand Perception in Digital Commerce

Managing a brand and brand reputation was challenging before eCommerce and Marketplace sales channels, now it can feel impossible. Frances Du wrote a wonderful article titled, "6 Ecommerce Branding Strategies To Build A Brand That Lasts," that provides a blueprint on critical things to consider as eCommerce continues as a bigger piece of the puzzle.

In her article, Du references Warren Buffet's quote, saying, "It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently," and Jeff Bezos's quote, "A brand for a company is like a reputation for a person. You earn a reputation by trying to do hard things well."

Brands, just like personal reputations were much easier to manage before the introduction of many of the technologies we live with today. If we draw the analogy between brand perception and personal reputation, think about how Public Relations Crisis Managers operate, waiting for anything else to steal the headlines from any negative attention on their clients might be caught up in at a given moment. This same short attention span exists on the positive attributes to your brand or reputation as well in today's world.

In her article, Du highlights six strategies to create and maintain a strong brand identity and stand out in a competitive market.

1. Understand your target audience and brand identity

2. Have a brand story worth telling and sharing on social media

3. Create a brand color palette and typography

4. Form connections online (or offline) for your ecommerce business

5. Deliver on your brand promise

6. Reinvent yourself to survive

All six are critical, but if we want to focus on brand health building relationships, let's start with number one.

How Selective Distribution Can Drive Brand Health

Understanding your target audience and brand identity is a must for every brand. Within that effort is understanding the target audience within each of wholesale partners or retail banner.

This is where selective distribution should be a key consideration in your revenue and brand management strategy. A brands wholesale partners likely have some unique perspective on how to service the market. Matching the products a brand creates for that target consumer with the retailer that is geared for selling to that consumer is where success happens. Detracting from these opportunities dilute the brand and harm the brand building relationships.

This practice generates more revenue through the right retail, all we have to do is guide it. There are nine principles to do this effectively.

1. Similar to number 1 from Frances Du - Know your customers and the consumer. Know who the early adopters are in that consumer group and where they shop.

   
   

   Treat each consumer group as its own business. Making the consumer feel special creates brand advocates. Have a holistic and honest understanding of how your distribution channel is going to engage with your target consumer. Many retail outlets think they have or can get the early adopters, same as everyone thinks their baby is beautiful. It is not statistically possible.

   
   

2. Product is King or Queen - The term is well known and often used because it is true. A company's success is inherently tied to the excellence of its offerings, as consumers are increasingly discerning and demand products that meet or exceed their expectations.

   
   

   The marketplace is competitive, and there are many options that are getting increasingly easier to find. Making sure your product offering hits its mark (where it's planned to be sold) is a must and creates a myriad of issues when it doesn’t.

   
   

3. Concentrate on your strengths – It is important to be aware of your competition’s strengths and weaknesses, but you will be more successful and happier if you concentrate on your own strengths and look to quietly address your weaknesses.

   
   

   Too many brands have damaged their brand health by chasing opportunities that were too much of a reach for either the brand’s ability to achieve the desired results with their resources, the consumers’ willingness to accept the product or service from the brand, or a strong competitor entrenched in that space. Matching brand strength with retailer focus wins every time.

   
   

4. Perception is everything – Be positive and be honest with your brand position as well as the position of the retail outlets where your products are sold. Call attention to what you want consumers to focus on, and when you draw attention to it, be sure it does what you say it’s going to do.

   
   

5. Have a North Star that is understood throughout your organization. The concept is from Stanley McCrystal's book, "Team of Teams," which emphasizes the critical importance of fostering agility and collaboration in modern organizations. The book underscores the idea that in an interconnected and fast-paced environment, success hinges on the ability of diverse teams to work together harmoniously, leveraging their collective strengths to achieve common goals. The business world has many fronts, and a coordinated effort maximizes the desired results, while minimizing the time to achieve them. Knowing the desired results for the company and how these trickle down to every retail outlet is a massive advantage.

   
   

6. There is power in momentum for brands and retail outlets. Recognizing and capitalizing on momentum in business relationships gives brands the ability to significantly improve their health.

   
   

7. Plan ahead - Have a seasonal plan built around brand building relationships, like those built with companies like Cabela's. Identify opportunities and risks within that plan. But work to hit the plan! You have likely spent more time thinking about the benefits of achieving the plan and have strategized on the preparation for the plan.

   
   

   Give yourself some room for flexibility within the plan that allows for some adjustments, and only change plans going outside the guardrails you’ve allowed for flexibility mid-season as an absolute last resort. Any in season changes to what you expected, take time from future season planning, a full strategy change will putt you constantly behind.

   
   

8. The details matter. Look at Disneyland, the details maximize the experience. Details go from the materials selected to make a product, digital assets, cohesive marketing campaigns, educational information for retail staff or point of purchase information, ensuring that the product is available in the right retail locations, the correct amount of inventory is bought to arrive at the right time, sales policies are thought out and in place to protect the product value in the current omni-ecosystem, and many other details contribute to the success of a product and brand. They all matter.

   
   

9. Take care of the big rocks. I love this one and use this philosophy all the time. The "Jar of Life" story is a metaphorical tale used to convey a lesson about priorities and time management. The story typically goes like this: A philosophy professor stands before his class with a large empty jar. He holds up a bag of rocks and asks the students to imagine these rocks as the most important things in their lives – things like family, health, personal goals, and relationships. Applied to business the big rocks would be key products or retailers.

   
   

   The professor then places the rocks in the jar until it's full, and he asks the students if the jar is full. The students agree that the jar is full. However, the professor takes out a bag of pebbles and pours them into the jar. The pebbles fill the spaces between the rocks. He again asks if the jar is full, and the students, catching on, say it's not. The professor then takes out a bag of sand and pours it into the jar, filling the remaining spaces. Now, the jar appears completely full. The lesson is that the rocks represent the most important things in life (or the most important things to your business), the pebbles symbolize less critical but still significant aspects, and the sand represents the smallest and least critical things.

When faced with any challenge, question, plan, opportunity, always take care of the big rocks.

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We specialize in the analysis of the health and compliance of e-commerce product listings, including source of product identification allowing for mass policy enforcement to deliver channel compliance. This information clearly and consistently informs our clients of overall and style level health to make real time adjustments to maximize profitability. We are passionate about protecting brand health and seeing strong brands thrive in today's marketplace.

Conclusion

Maintaining a premium assortment perception in an environment where eCommerce is such a big part of the retail landscape is challenging, but certainly not impossible if done the right way.

Embracing a selective distribution strategy allows brands to partner with retailers who are genuinely invested in engaging with their target consumers. This approach not only maximizes profitability but also enhances brand perception. When products are sold through the right channels, it creates a cohesive and authentic brand experience for customers. However, any deviation from these brand-building transactions can undermine the brand's integrity and long-term success. Consistent alignment with the brand's values and carefully chosen distribution partners is essential for maintaining a strong, sustainable market presence.

We have helped multiple brands navigate this challenge, setting up, monitoring and managing brand protection strategies daily.

Counter Diversion is a boutique SaaS company - we don't have marketing, and we don't use high-pressure sales tactics. Our goal is to have solid, honest conversations about the issues at hand and then either recommend our service or another one that is a better fit for your needs. If you'd like to engage in that type of discussion, schedule a consultation here.