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GUEST COMMENT Are brands missing a trick not incentivising independent retailers?


B2B retail engagement programmes are big incentive drivers that big manufacturing brands use to help retailers sell their stock. These incentive schemes are often linked with leading supermarkets and the department store giants of the retail world. But, are brands missing a trick not focussing these incentive schemes on independent retailers too?

How B2B retailer engagement programmes work

Retailer engagement programmes basically provide a way for brands to engage with retailers to help sell their products. These could range from fast-moving consumer goods (FMCGs) like toiletries to larger products, such as electrical kitchen appliances. By selling certain volumes of such stock, retailers can win rewards. Big supermarkets and department stores, with their big sales teams and bigger budgets, are often the one’s brands select to complete such B2B incentives schemes. However, I think big brands aren’t fully benefiting if they don’t focus their schemes on independent retailers, like smaller multi-channel companies and ecommerce sites.

Using these retailers involves the same approach – businesses and their staff can win rewards for selling the brand’s products. Rewards are earned through an online points banking system, which means the retailer collects points for each product they sell. When they reach certain point totals, the points can be used to win rewards. This includes iPads, TVs, jewellery, vouchers and experience days.

Points can be rewarded to the store or an individual member of its staff. The retailer can use rewards for themselves, or share them with their team, or use them as internal staff incentivises to help generate sales further. Rewards can also be given for improving product knowledge, and referring other businesses to join a scheme.

In addition to this, the retailer can gain funded marketing support or collateral for meeting or exceeding specific objectives related to a brand’s products. There are also the opportunities for business teams to win invitations to brand-related events, like hospitality experiences and award shows, based on their performance. They could also be invited to the brand’s manufacturer annual awards, be nominated for an award, and have the opportunity to win some business recognition.

So there are many benefits to the independent retailer, like multi-channel retailers and ecommerce sites, in terms of winning incentives and rewards. But, in selecting them, there are many benefits for the brand too.

Gaining a greater stake in the market

Firstly, there’s the chance for brands to gain a greater stake in the market. By selecting independent retailers, they can get a greater volume of stock sold in stores across a more widespread geographical area, potentially, resulting in winning a bigger percentage of a product’s key market sector. They could also get even more stores incentivised to sell their stock, if retailers successfully encourage other businesses to join their engagement programme too.

By aiming their incentives at smaller, independent retailers, brands can also encourage them to give their products better visibility, such as new products they might want to push to market, or existing SKUs they are trying to distribute from their warehouses. This could include a retailer giving select products of an FMCG brand prominent positon on its store shelves and web site, so that they stand out and have fewer products to compete with. For the customer, this is likely to have a positive impact on brand awareness, compared with a huge supermarket store or large ecommerce site where products might get lost in a sea of other items.


Creating brand ambassadors

Another key reason why brands should consider independent retailers for their engagement programmes is they can create brand ambassadors to drive their products. These are a retailer’s staff members who are loyal to a brand, engaged in its offerings and have the knowledge, motivation and passion to sell its products effectively.

This is because programmes can include tiered levels of objectives where retailer staff win rewards for completing them and progress to become a brand champion. This involves them selling products effectively, alongside building their knowledge of that brand and its products to do so.

Consequently, as engagement programmes get more staff fully trained up to sell a brand’s products, brands get more retailers dedicated and loyal to their brand, with passionate ambassadors to promote their offerings. In turn, stronger relationships can develop between retailers and brands, strengthening a brand’s supplier chain. This can also help improve its reputation across the retail industry, as retailers tell other businesses about their positive experiences with that brand.

A power brand benefiting from independent retailers

Global household electricals manufacturer Hoover is an example of one big brand doing things right – incentivising independent retailers with its engagement programmes.

We have worked with the company to create a B2B sales incentive programme for independent retailers that sell its stock. The online points banking programme, called Hoover PowerPoints, is accessible to retailers and regional managers on the road.

It was launched in February 2016, with the aim of setting Hoover apart from its competitors, which didn’t offer an incentive initiative. The company hoped it would help it cut through competitor noise, gain dominance in key departments of products, and increase its market share. This included SKUs and new ranges of its washing machines, tumble dryers, dishwashers and fridge freezers.

As well as improving sales performance, the engagement programme aims to encourage retailers to drive brand awareness and enhance loyalty. Retailers are rewarded for their performance and acknowledged for their efforts with points that can be converted into desirable prizes and rewards that they can win from a rewards catalogue. Detailed product specs have also been put on the programme’s website to help improve product knowledge, arming retailers with the information they need to achieve higher Hoover sales.

The way the programme works involves retailers uploading a self-claim form to prove when they have made a sale. Hoover stakeholders then review the claim, with points awarded once it’s been approved. The programme also features other promotions, including “refer a business friend”, enabling retailers to promote incentives to local businesses. If they are successful in getting a business to join the scheme, the retailer receives bonus points to spend in the rewards catalogue. Other tactical promotions have included prize draws and double points for the sale of specific SKUs.

Proving the power of independent retailing

The Hoover incentives scheme has been a huge success and shown how a big brand like Hoover can hugely benefit from targeting independent retailers for its engagement programmes. In the period of February to October 2016, standout results showed an increase of 270% year over year in Hoover’s logged sales. There was also a 67% increase in the total number of rewards redeemed, and a 112% increase in the number of submissions made to “refer a business friend”, when compared with previous schemes the brand had tried.

The results also showed how independent retailers can successfully engage in incentive schemes, with 70% of people actively using the engagement programme site, and active users increasing by 103%, compared with the previous year. This goes to show the power that independent retailers can have when it comes to retail engagement.

From gaining greater prominence in the marketplace to creating more ambassadors to get behind campaigns, manufacturing brands can benefit from targeting their engagement programmes at independent retailers. Big brands don’t have to turn to big retailers to see significant results. Independent retailers can, and should, have a prominent place in B2B retail engagement programmes too.

Author: Kevin Chamberlain is the new business development director for Corporate Rewards

Image credit: Fotolia

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