The way elbows are flying between manufacturers and resellers, today's
emerging customer-controlled marketing model is starting to look like a Sunday
afternoon at the Roller Derby.
In the pink satin, you've got your channel of distributors, dealers,
resellers and retailers, who transact directly with customers/end users and
gather truckloads of data directly tied to purchase behavior.
In the blue satin, the manufacturers, who historically controlled information
flow about their products through a channel system composed of resellers, media
Let the games begin
In the first period, manufacturers dominate because they have unique or differentiated
products and services that are in high demand. Thanks to their unique offerings,
distribution systems or dominant brands, the manufacturers are able to control
and dictate how the brand is sold, at what price and, to a certain extent, even
But about two minutes into the second period, big mo starts to shift.
The guys in the blue shorts see their power erode. A hard check into the rail
here. A knee to the groin there. But did the manufacturers make massive substitutions?
Bring in a new front line?
No. Most continue to market as they always have,
often with declining success and increasing costs.
Whack, bam, boom
The channel team in pink is wresting control from the manufacturers because
they're getting more information, knowledge and understanding of the customer
and end user than manufacturers.
That includes the simplest of things, like a list of who is buying and
using the product. (Something many manufacturers still don't have.) It
also includes some pretty sophisticated data processing technology that tells
them what, how much, when and why end users are buying.
All of this provides
tremendous contact with the customer and understanding of customer wants and
More powerful than a speeding
This marketplace power shift gives the channel team more control over the blue
satin manufacturers than Ralphie Valladares on an uncontested breakaway. In
some cases, they even dictate distribution outlets, sales channels, pricing,
packaging and contacts with end users. All because they are closer to the customer.
If you're a manufacturer gliding around the track during this paradigm
shift, watch out. You can be blindsided with a mammoth hip check that will send
you sprawling across the boards. In fact, if you want to know how bad it can
get, we've got two words for you: Wally World. Check out the power play
Wal-Mart is putting on consumer manufacturers.
To make things worse for the guys in the pink satin tights, manufacturers
see brand loyalty waning. The hometown fans go silent. The crowd is out of the
"How can that be?" whines the coach in pink as he hurls a folding
chair across the track.
Able to leap customer expectations
in a single bound
Well, maybe it has something to do with the channel communicating better and
taking better care of manufacturers' customers than the manufacturers themselves
For example, many customers no longer look to manufacturers to stand behind
their brands. Dealers, retailers and distributors with no-questions-asked return
policies and warranties are taking over this role, making exchanges and then
demanding credit from their suppliers.
And this is just one of the situations that is transferring brand loyalty from
manufacturers to the channel and increasing channel strength. As a result, there's
now so much mistrust and paranoia between the two it makes the war room in "Dr.
Strangelove" look like the Jacuzzi at Hedonism III.
Winning by taking care of the
In other words, the channel is reducing risk for customers, and customers in
return are transferring their loyalty to the retailer's brand rather than
the manufacturer's brand.
And now, as technology pushes control of information toward the customer,
a fourth period Battle Royale is erupting between the two warring camps for
contact and control of the sales process.
They're lusting after the same customers like Donald Trump on a double
dip of Viagra. They're both chasing the buyer and breaking all the rules
along the way. Yessir, it's a no-holds-barred, slobber-knocker at Coho
So now you've got dealer chains and distributors tussling with manufacturers
over customer data. Manufacturers trying to block the channel by selling direct
and setting up shop to go head-to-head with their resellers.
And there goes another one over
the rail, fans
But where does that leave business marketers and communicators going into the
If you're a reseller, it means two things.
First, you might want to think about using the customer data you have
to integrate products and services into solution offerings based on need bundles
consolidated in one location. And then incorporating that concept into your
brand and your communications. (Check out the idea of value offers.)
Round and around the brand they
And speaking of brand, that's number two. Many channel organizations are
building or trying to build brands or private labels to help
gain even greater information, communication and customer relationship power.
For manufacturers, shoring up your brand will be paramount. But not in the old,
The new paradigm requires data about your customers/end users, their
needs and buying behavior. It demands you begin a dialogue with these folks
and listen to their input. And it means developing brand relationships based
on reciprocal loyalty.
It's not about owning the
In either case, you're going to have to look at this issue from a totally
different perspective. Things have changed. And you should consider changing
the way you think about customers or you're going to be like those whiny
dweebs who got to the cocktail party twenty minutes too late and all that's
left are those little wieners and a half-empty bottle of Zima.
In this new age, when the customer controls communications and information,
it's better to have the customer own you than you owning the customer.
It's about getting the customer
to own you
And that has to do with branding that's based on customer and prospect
buying perceptions. It's about listening and responding. It's about
developing a dialogue and a relationship, not a transaction. It's about
connecting customers with other customers and prospects who share the same product
applications, problems and opportunities.
But at the heart of it all, it's changing your perspective of what
a customer is.
Once people become customers you need to stop thinking about them as
part of the market. They are not the market. They are your customers and you
need to look at them and communicate with them in a different way than the market.
And it's not over yet
The game for getting the customer to feel total involvement, interaction and
ownership of your brand has just begun. Hey, it's the Roller Derby. It's
not over until the final jam. And sometimes even then it's not over. There's
always a surprise at the end.
This time it's yet another shift in how we think about brands. And if you're
not careful this one could create a divide between manufacturers and their channels
so large Ted Kennedy could drop an Oldsmobile into it.
Historically, brands have been based on a promise that customers can
count on the brand because of the attributes of the offering. But now a new
kind of branding is emerging, where the promise is that the brand knows you
as an individual customer better than anyone else, and you can trust the brand
to assemble the products and services to meet your individual needs. Even for
products and services beyond the initial category.
One more kick in the groin for
old times' sake
Contrary to conventional one-to-one marketing thought (one vendor dealing with
one customer at a time) this approach is based on the new-paradigm market of
connected customers. In a networked, connected marketplace where everyone has
access to everyone and the customer controls the buying process, what customers
want are many vendors to choose from.
They want to leverage the full capability of the network to access whatever
resources they need from wherever they are. And they want them bundled together
in ways that are convenient and accessible and tailored to them as individuals.
How's that for an elbow to the head and a skate to the midsection?