Synopsis: Building Materials – Vinyl Siding – Channel Strategy
A building materials manufacturer wanted to grow its share within existing distribution channels. The manufacturer needed to understand the types of programs and support distributors and contractors value most. So the starting point was to get an understanding of the distributor’s business – how he sold, his target customers, his use of marketing, the importance of special pricing and direct ship programs, etc. This helped us begin to segment distributors and we could quickly see that size and customer base were key dimensions to this segmentation.
From this we found out what was important to distributors and how our client perceived the importance of these items. The chart below shows scoring on these importance criteria.
These importance criteria also varied by size and type of distributor.
As can be seen, the large distributors and distributors focused on new construction were much more sensitive to issue of problem resolution, sample cases and product literature, whereas distributors who focused on remodeling were much more interested in marketing support and sales training than large or small distributors – the size of distributor did not matter here, but instead his customer focus.
Using these initial findings, we then dove into deeper conversations to understand specifically what distributors were receiving from suppliers today across the most important of these programs. Then we proposed new program concepts to the distributors to see how they would react and which programs had the most potential.
The ultimate outcome of the projects was that we identified key programs for each segment of the market – those required to compete and those required to differentiate. With this information, the manufacturer designed effective, new marketing programs and ultimately grew its share.