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Channel Strategy

Optimizing your retail presence across channels and retailers

Many consumer products manufacturers lack a consistent and data-based strategy to guide their deployment in market across channels and retailers.  The fundamental questions of "who we play with and how to play with them” are not explicitly addressed with a data-based foundation.  Without a guiding strategy, a company’s channel approach can become arbitrary and unproductive.  Companies also become vulnerable to the trap of trying to be all things to all retailers - a sure way to over-support low opportunity retailers and under-support those with the greatest upside.

GfK’s Channel Strategy process develops fact-based strategies that identify the rules of engagement with each key channel or retailer and helps to maximize resourcing efficiency and business performance.  While individual engagements vary and are customized for each client’s unique needs, several approaches are typically included:

• Situation assessment: What’s working, what’s not, what’s needed?

• Customer prioritization: Who are we most interested in engaging?

• Executional roadmap: How do we engage with them?

Situation assessment

The situation assessment aims to illuminate the key business issues and opportunities faced by a manufacturer from multiple perspectives – including, but not limited to, the channel/retailer perspective.  It utilizes a range of activities which may include:

• Key stakeholder fieldwork interviews – both inside the organization and in the broader industry
• Marketplace analytics of various data sources including point of sale, consumer panel and other syndicated data sets. At the highest level, this work identifies what’s working, what’s not and what’s needed for manufacturers to inform development of the channel/retailer priorities and executional roadmaps
• Industry benchmarking to identify relevant best practice approaches to navigating the retailer landscape
• Mining of consumer and shopper studies and insights

Customer prioritization

We provide a data-based foundation for evaluating and prioritizing the range of channel and retailer relationships available to a manufacturer. Our process enables organizations to be choiceful in these relationships, shifting focus and support where it can drive the biggest wins.

At the core of this process, we build a quantitative model designed to do two things:

• Identify the potential channel and retailer universe that is relevant to the manufacturer’s proposition – thinking expansively about all the possibilities across traditional bricks and mortar, digital, emerging formats, etc.
  

• Sort potential channels and retailers into priority tiers that drive the level of commitment and investment by the manufacturer organization.

Models are custom built to suit a client’s needs, but key metrics frequently include both quantitative and more qualitative measures such as:

• Growth history and trajectory
  
• Pricing dynamics
  
• Size and shopper traffic
  
• Geographic footprint
  
• Cost to serve
  
• Level of executional ability
  
• Ability to capture manufacturer key shopper group
  
• Role customer assigns to manufacturer categories
  
• Level of collaboration and receptivity to manufacturer thought leadership
  

Executional roadmaps

With the question of "who” resolved above, activities turn to the equally important question of "how to engage” in each of the key channels and retailers in the plan.  The "how” typically is dimensionalized across the most critical retail executional elements:

• Product portfolio deployment – should the whole portfolio be stocked in all outlets?
• Merchandising presentation – how should section location, signage, organization, vary across channels/retailers?
• Promotional execution - which tactics work best in which channels and where do we want to invest more heavily vs. more conservatively?
• Product supply - how to best integrate with each retailer’s operations capabilities to maximize total supply chain efficiency?

These executional questions are addressed through a series of activities usually including:

• Mining channel and retailer level shopper insights: How does shopping and behavior differ across different channels and retailers?
• Conducting retail best practice analytics focused on the major in-store executional elements like promotion, assortment, etc.
• Channel/retailer level SWOT analysis to profile leverageable strengths and weaknesses to manage.

Taken together, these activities roll up to a cohesive and data-based channel strategy to address the vital deployment questions that must be navigated for manufacturers to realize the full potential of their brands and portfolios.

Getting Started

To learn more about GfK Channel Strategy, contact us today.