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How Distributor Marketing Differs From Other Industries

How Distributor Marketing Differs from Other Industries

Before diving into distributor marketing, we need to establish that distributors are middlemen. They build relationships with manufacturers and customers that create opportunities for sales. For customers, they provide application knowledge, product expertise, service, and support. Then, distributors offer manufacturers their salesforce, administration, and customer base. In other words, distributors maintain value-adding relationships on both sides of the equation.

How Distributor Marketing Differs From Other Industries

Sales and marketing are terms we often hear together, but they aren’t the same thing. We often call sellers “hunters” or “farmers.” We distinguish between sellers who prefer prospecting and those who prefer relationship maintenance. Marketing is neither of those because we don’t have the hunter’s scope nor the farmer’s fields. A better analogy for marketing is fishing. You don’t fish for tuna in Lake Michigan or a walleye in the Gulf of Mexico. A decent fisher knows where they are likely to find the right fish. A good marketer knows where they’re likely to find leads. We need hunters, farmers, and fishers to get a balanced diet.

When it comes to marketing, distributors face a problem – most marketing targets retail relationships (B2C) when they work in business-to-business (B2B) markets. For example, B2C marketers have access to well-developed and refined individualized consumer data – sometimes it’s third-party, and other times it’s in-house. This data lets them slice and dice their email lists for maximum effectiveness. We can learn some lessons from consumer-oriented marketing. For example, message timing is critical. Emails sent when they’re likely to be opened have increased click-through rates and conversions. Take a quick look at your campaign history; you’ll see graphs that look like this:

We can find other similarities between B2B and B2C marketing, but that’s not the point of this article. Even within B2B marketing, there are differences. Manufacturers and distributors have different audiences to consider. From a manufacturer’s perspective, they are interested in promoting their products. They don’t have to worry about competing interests from their suppliers. On the other hand, distributors regularly balance relationships between competing lines.

What Marketing Challenges Do Distributors Face?

There are many distributor marketing challenges. We can group these into four categories:

  • Finding and refining targets
  • Managing vendors
  • Internal competition
  • Creating content

This section will discuss some challenges in each category and potential solutions for them.

Finding and Refining Targets

crm marketing for distributorsFor all marketing efforts, finding good targets is critical. Sending promotional emails to accounts payable won’t help the relationship. But it might hurt it. We must continually add new targets to maintain and grow an email list. We can do this by gating content, using third-party databases, and harvesting email addresses from our records, among other ways. But not all email addresses are equal.

Marketers should have a role-at-account field in any CRM or marketing automation platform. Even if you have good job title data, you need this field. Why? Because titles vary between organizations and are often confusing. For example, a maintenance engineer at one company may be a facility planner at another. Role data lets us group these contacts into lists, regardless of title. A role field should be a selection list, not a text box. We can make assumptions, then update the role field as we learn more.

Conversely, we must maintain opt-out information for contacts requesting to come off our lists. On that same note, we don’t want to waste emails on people who won’t read them, and we certainly don’t want to feed a competitor an idea. So, it’s good for our relationship managers to identify less-than-friendly or competitive contacts in established accounts. Additionally, it’s crucial to identify those contacts who are supporters, allies, or champions of your distributorship.

For a B2C marketer, contact-level information is all they have. But with distributor marketing (and B2B marketing generally), there’s another complexity. For example, if you’re promoting a bulk-handling conveyor system, it wouldn’t make sense to send a promotional message to accounts that are unlikely to use that product. At a well-seasoned distributorship, there are thousands of accounts, many of which are active at least once a year.

So, how could we slice and dice these accounts? We could use account-level attributes like facility size, industry, location function, number of employees, and annual revenue, to name a few. But we need them first. Third-party data is an option that B2C marketers use all the time. It’s scary how much Google and Meta know about us. For B2B marketers, these data sources can be a crapshoot. So, we need to rely on our inside and outside sales teams to do the reconnaissance. We must build good CRM habits like reviewing account and contact data before a call is a good way to improve this data.

Managing Vendors

crm marketing for distributorsDeveloping a distributor marketing strategy requires that distributors selectively promote products to targeted segments. A distributor’s first external job is keeping their customers happy. Their second job is keeping their vendors happy. Often, these two interests run counter to each other – pleasing a customer can mean trouble for a vendor relationship, even when the customer is in the right. And distributors manage complex relationships all the time: demanding customers, picky vendors, and stuck-in-the-mud employees. Product and line selection for marketing and promotion add complexity to these relationships.

B2C marketers fall into two camps: retailers and direct-to-consumer. Large retailers have explicit marketing agreements; smaller ones face similar problems to distributors. Direct-to-consumer firms have it easy – they’ve only got their product, just like your manufacturers.

Complexity in these relationships, in other words, is a breeding ground for conflict. Like all conflicts, ignoring them is the worst possible strategy. Avoidance leads to resentment, festering anger, and eventually to confrontation or separation – even worse, both. So, distributors must develop a clear plan for managing these vendor relationships.

Many vendors have preferred distributor programs: sell over X per year, get an extra discount or have priority access to leads. Distributors can do this, too. Consider a key-vendor program. Define criteria like access to leads, on-time performance, industry position, and discount rates, among others, to evaluate vendors. Vendors who make it into the key vendor program will have their products promoted. But someone has to manage this key-vendor program.

A more straightforward way to manage this may be to identify touchy vendors – who are a bit more competitive than the rest. You could get ahead by letting them know you’ll be promoting a competing product line or offering ways for them to partner with you in marketing. Or you could make sure that they don’t get the email.

Defined programs are ideal, but they’re a lot to manage. Managing by exception is simple at first, but slip-ups can cause serious problems.

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Internal Competition

I’ll ask you this: what’s marketing to your firm? For some, it’s a sales-support activity. Distributor marketing develops collateral and promotions to support sales-driven efforts. For example, many distributors use email newsletters to push products to their entire customer base. This effort seeds the ground for sales – a reason to talk if the client clicks. But this mindset is limiting – it positions marketing as a cost center instead of a growth generator. It also means that the sales team steers the ship. So, suppose your sales compensation plan has a high commission component. In that case, the team will likely choose a course that leads to the highest, quickest payout. That’s good in the short term, but not forever.

Distributors must make sales to survive. But many distributors have difficulty adapting to changing market conditions leading to diminishing returns. Changing the business’ relationship with marketing can help them navigate the eddies and chops of change.

The other side of distributor marketing is demand generation. Going back to our fishing analogy, a fisher must:

  • Identify the kind of fish they want to catch
  • Select waters that are likely to house those fish
  • Use bait and tackle appropriate for the fish, waters, and boat

Marketers, similarly:

  • Identify a segment of their market they want to grow
  • Select a target within that segment where they are likely to get traction
  • Use products, promotions, and pricing to catch the leads

These leads aren’t warmed up existing customers; they are qualified, fresh, USDA Grade-A new business. The lifeblood of a growing, thriving business.

We need to talk about building a cooperative and mutually informative relationship between sales and marketing. We’ve spoken about enriching contacts and accounts with attribute data and managing vendor relationships while picking product lines to promote. Don’t worry; we’ll get to content creation in the next section.

Occasionally, a novice fisher accidentally catches the big one. That’s beginner’s luck. A skilled angler knows there are good days and bad, big hauls and empty hulls. So too does a proficient marketer. Marketing requires experimentation and risk-taking, as does selling. Salespeople can experiment with messages, timing, promotions, and lead products on a one-to-one basis. Marketing does this in large batches – targeted segments and curated contact lists.

Here’s where we can build cooperation between sales and marketing – hit the same contacts with similar messages through different channels. Imagine that your firm has identified a growth segment and an ideal product to match. Marketing can send emails, push social media, and drive traffic through search and content advertising. Sales can individually contact current and prospective customers to make a direct pitch. Both teams can record, through automation or manual entry, the results of their efforts. The teams can then see which messages worked, which channels proved most effective, and find opportunities for improvement.

You might be saying, “Wait, this sounds like sales support. Weren’t we talking about demand generation?” It does, but there’s a difference. Sales and marketing are building the plan together – cooperating on design, execution, and analysis. When there’s mutuality, there’s a more significant opportunity for growth.

Creating Content

crm marketing for distributorsWe’ve beat around the bush for long enough.

Distributor marketing requires content, and content is hard to develop.

Writer’s block exists, as does the fear of writing.

We also have demands for our time–creating content is a long-term gamble. Making a sales call, sending an email, or browsing LinkedIn has quicker returns. But, once we stop sending emails or making calls, we can’t generate more returns from those efforts. Content lasts and pays dividends over time.

My favorite guide for writing is Writing Without Bullshit by Josh Bernoff. Bernoff argues that most writing today is terrible. He shows that readers find article upon article laced with weasel words, passive voice, jargon, excessive length, and algorithm-focused passages. I encourage you to order and read the entire book, but here are a few key points:

  • Be direct and concise – Make your point, support it, and move on.
  • Avoid the passive voice – Sentences like “The machine is actuated with the control panel” may sound fancy, but it’s confusing.
    • You could add “by zombies” to that sentence, and it would make sense because the object is modifying the verb with an undefined subject.
    • A better way of writing it would be “Operators actuate the machine with the control panel.” It’s clear who’s doing the action. The subject is verbing the object.
  • Avoid jargon – Certainly, we’ve used some here, and it’s necessary sometimes. But plain language goes a long way in clear communication.
  • Get rid of weasel words – Think of words like growing, many, millions, billions, significant, very, etc. These all communicate quantity or intensity but lack precision. In other words, they are vague and misleading. They weaken your writing.
  • Make time for writing – Schedule time where you can focus and turn off distractions like phones and email.
  • Have someone else read it – It’s hard to find your own mistakes, especially when you’ve stared at the document for hours.

It’s a fun read, and there’s plenty of practical advice.

Here’s a final note on writing: the size of the piece matters. Email content should be less than 300 words, a short blog post around 750, and in-depth pieces should be around 2,500 words. That is 2 minutes, 4 minutes, and 10 minutes reading time.

Putting a Bow On It

Marketing for B2B distributors shares features with marketing in other industries. Still, it has a distinct set of challenges all its own. But by strategically thinking about marketing, distributors can leverage it as a growth engine. Creating plans that identify target segments, messaging, products, and promotions is essential. Communicating those plans to sales to encourage cooperation helps build better results. Vendors are both threats and opportunities – managing those relationships wisely can help us avoid pitfalls and promote growth. Finally, you’ll have to do some writing. Don’t worry; it doesn’t need to be over 2,000 words like this piece.

Written By

Brian Harrington Profile

Brian Harrington

Brian Harrington is the founder of Focus Ten Consulting, which focuses on helping distribution businesses achieve better sales and marketing results through coaching behavioral changes paired with the right tech tools mix. Brian is also a former White Cup customer with a deep understanding of our products and gaining maximum value from our revenue intelligence platform.

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