Packaging University

Retail Marketing

How to get your products into retail

What is it with Retail?

What markets you target are critical to your company’s success. Just getting your product into retail is a struggle. Retailers are bombarded with similar products, and with limited shelf space available, their job is to select a product that will appeal to consumers while maximizing profits for their store.  You, as the manufacturer, or distributor, need to put your retailer’s hat on and think like they do.  What is important to them, and how can I address their needs through our product and packaging?  You crack this nut and you’re well on your way.

Where do you Start?

The retail universe is vast and segmented.  A good strategy is to identify what segment best suits your product, and pursue that avenue instead of starting with a shotgun approach.  It keeps you focused, and more in tune with what customers in that segment are all about.  Sales will come from building a solid foundation within these market segments.  And with a proven track record, it is easier to get into other, possibly more desirable, retail channels.  It’s similar to building a pyramid where each level is solidly supported from below.

A grass roots marketing approach:

  • Allows you to build a customer base
  • Lets you fine-tune your marketing plan and branding
  • Gives you a track record to show larger retailers
  • Allows for a higher profit margin than with larger retailers
  • Starting local gives you a stable sales base by not putting all your eggs in one basket

“Big Box” Retail – Going for the Gold (well, maybe not!)

For many, placement in large retail establishments such as Walmart, Whole Foods, Home Depot – “Big Box” stores, can be very profitable and, in many ways, represents the pinnacle of success. However, because of intense competition, unless you have a better mousetrap, you’ll be fighting your way in to these stores. While many of our customers have ended up in the larger retail stores, most have done so by building a foundation starting at a grass roots level. By developing relationships with local chains, distributors and independents, and branching out from there, you are building a solid foundation for your success.  And, you may find the smaller venues more profitable than the larger big box outlets.

While large retail stores can generate large sales across a wide geographic area:

  • You will be expected to do most of the marketing for your product
  • Your profit margin will be squeezed
  • They will require a large first order; you must be ready to meet the demand
  • Expect to wait between 90-120 days to be paid
  • There is more product competition on the shelf
  • They generally like to see you have more than one product, and a proven track record

Branding and Private Labeling

No matter what level you start at, build a brand that is desired by the public. Brands convey concepts such as quality, reliability, and status. Brands outlive individual products. Think about Apple, Nike, Google and Nordstrom – these are all well established, and well liked, brands. Each has a strong presence in their fields, and is widely recognized even outside their field. Customers know and trust them, are more inclined to purchase from them, and at costs they set. For a start-up business, building your brand should be a high priority; without it, you are competing on price alone.

You might also consider a private label manufacturer to quickly bring your idea to market, or to diversify your product line. A private label manufacturer uses a stock formula or product, then puts your brand on them. You’d be amazed how many products in the marketplace are actually private label. A contract manufacturer will go further: actually developing your product to your specifications. A private labeler brings technical expertise and experience in your market area, and allows you to put your energy into marketing your products, not setting up production.

Printed packaging

Regardless of where you decide to go in the retail arena, most retailers will require you to have professional packaging for your product. Even during the evaluation process, many retail merchandise buyers want to see the printed packaging that will be used with the product. Remember, they are evaluating whether your product would fill a need and has shelf appeal in their store before they make a commitment.

In conclusion…

Targeting big box retailers is a good goal. But start by building a solid business base. Once you have established a strong brand you’ll have much more leverage in dealing with retailers of all stripes. You may find your overall profitability is much higher starting with grassroots marketing. Keep in mind, regardless of where you decide to start, the overall key to making a purchasing agent interested in your product is to persuade them why it will generate more profits than what is currently on their shelf.

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