Sales and Distribution Strategy Was Based on Heavy Trade Involvement


Sales and Distribution Strategy Was Based on Heavy Trade Involvement

At the time this marketing effort was being planned, except for the privatelabel lightbulbs, there was mostly one brand per retail outlet. There were some exceptions. For example, at Home Depot, GE and Philips were the two major lightbulb brands, and then there were six other brands on the shelves , including Panasonic, Toshiba, and Westinghouse. ABCO licensed the Westinghouse brand name from Viacom and put it on imported lightbulbs from China.

The Philips factories generally shipped lightbulbs from the factory warehouse to a Philips combination warehouse, where all of the different types of lightbulbs were brought together. The retailers regional depot orders would come into these facilities, and the products ordered would go to the retailers regional warehouses. The retailer would then generally distribute the lightbulbs to the stores. There were some exceptions where Philips would ship directly from its combination warehouse to a retail store. Usually, however, Philips would deliver to a chains warehouse for store-level distribution.

Philips did a lot of research with the retail trade in preparation for this major new marketing strategy. The sales force was involved in this research, but so were a lot of marketing people. A lot of the higher-level meetings were not limited to a salesperson, but included a vice president of marketing, the category leader for the products, and sometimes even the president. Philips presented to retailers what its research had shown, and explained how the new Philips product line would differentiate the retailers offering. Category management suggestions were an important part of these meetings. Philips showed retailers how they could earn substantially more money from the same amount of shelf space with the new line of Philips lightbulbs because of the premium pricing of these superior products.

The long-life strategy worked well. Home Depot eventually made Philipsits exclusive major brand of lightbulbs. This was significant because Home Depot sold one out of every five lightbulbs in America at that time. Home Depot felt that the new Philips strategy would help it differentiate its lightbulbs from those sold by Wal-Mart and other competitors . Other retailers also switched their lightbulb brand from their previous source to Philips. Wegmans, for example, switched to Philips because it is a store that likes to sell better products, and it saw that switching to Philips fit its overall strategy.




Powerhouse Marketing Plans(c) 14 Outstanding Real-Life Plans and What You Can Learn from Them to Supercharge [... ]aigns
Powerhouse Marketing Plans(c) 14 Outstanding Real-Life Plans and What You Can Learn from Them to Supercharge [... ]aigns
ISBN: 735621675
EAN: N/A
Year: 2006
Pages: 172

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