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Today.1. Significant changes2. Distribution funnel changes3. Distribution strategies for online

business models4. Fundamental questions 5. Which strategy for you?

(examples)6. Tips for optimising!

Ronald van Klooster.presentation and whitepaper download at:

www.maxlead.com/porto

Significant changes.1. Important changes due to the internet

a. online customer journeyb. transparant product informationc. Supply chain (IBD’s) marginsd. Traditional versus new business modelse. New entrants

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Customer journey.

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Transparant product information .

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IBD’s margins?.

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1. based on volume and function?2. based on added value?

i. knowledgeii. delivered leads to orders (conversion rates)

iii. local propositioniv. customer rating on after sales and servicesv. certification

vi. back offices connected to the web (transparency stock, data sharing)

Traditional vers. new businessmodels?.

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1. New business models, no dealers, more budget to connect end userBrand preference, experience, availability/ease of use

2. Old models with dealers, hardly budget to connect

New entrants?.

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local players, direct to consumers

international players, direct to consumers

online retailers with several brands and an omnichannel strategy

none core retailers, big stores selling mostly non branded bikes

TRA

DIT

ION

AL

IBD

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ONLINE WEB

STORES

PRICEPROPOSITION

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Strategies!.

6 strategies.

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` manufacturer dealer (IBD) end user

1. Intermediary support strategy *2. Information sharing *3. Channel absorption4. Differentiation (sell via or to target groups)

5. Conflict avoidance (branded clothing retail)

6. Profit Sharing (80’2, IT vertical)

Channel absorption.

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Differentiation.

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1. Manufacturer defines a number of target groups2. The IBD sells products to a certain group and the

manufacturer focuses on a different customer segment

Conflict avoidance.

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1. Direct delivery to customers, but at the same time has respect for the supply chain.

2. Typical for branded clothing retail

Profit Sharing.

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1. This strategy dates back to the 80’s2. IT markets and hardly ever applied anymore

Intermediary support strategy.

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1. Direct online contact with consumer2. supports various links in distribution chain3. no direct sales to consumer4. for complex products (experience!)5. hedge role for the internet (awareness)6. co-creation

Intermediary support strategy.

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1. control over consumer (online profiles, insights)2. central managed marketing organisation3. margin dealer depends on conversions, added value4. simple changeover model to E-commerce5. affiliation model easy to apply (webshops)

Intermediary support strategy.

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1. dependent on small group of IBD’s2. coverage problems insufficient nationwide distr.3. online profiling limited in case of physical stores4. Too much margin IBD’s, no budget to effective

execution of this strategy

Example Intermediary support.

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Example Intermediary support.

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reach

Example Intermediary support.

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deliver the consumer to IBD

Example Intermediary support.

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“try and buy” at the IBD

Example Intermediary support.

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Feedback process (IBD & consumer)

Example Intermediary support.

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Dashboards on performance

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Transparency!

consumers search for boilers locally, Vaillant buys their visitors.

Vaillant creates dealer pagesconsumer can submit for a proposal

no dealer website, just all controlled by Vaillant

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Information sharing strategy.

1. Manufacturer exchanges information about leads & customers2. bright future, suitable for internet driven markets (see, think)3. buying habits, market intelligence, local propositions etc..4. manufacturer shares knowledge, the dealer gets competitive value 5. central managed marketing organisation6. in house development customer profiles, CRM and distribution7. suitable for larger volumes through distribution chain8. Thanks to knowledge transfers, retailers work faster & more

efficient

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Information sharing strategy.

1. total control over consumer & dealer2. central managed marketing organisation3. in house development customer profiles, CRM and distribution4. suitable for larger volumes through distribution chain5. Thanks to knowledge transfers, retailers work faster & more

efficient

Information sharing strategy.

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1. Strong data driven marketing organisation2. A risk that performing dealers become competitors3. limited number of dedicated dealers4. Too much margin IBD’s, budget needed to effective

execution of this strategy

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Direct from Philips

dealer Bol.comRonald is a customer and the bol.com cookie placed on Ronald’s PC recognizes him. (dynamic web content)

Bol.com margin will be less!

Google or Amazon?

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6 fundamental questions?.

1. to what extent does internet determine your market? how online is your customer journey?

2. which business model are you applying right now?3. which competitors do you see entering the market? (sharing?)4. Do you supply products with a complex purchasing process?5. to what extent do you need to use a nationwide service network?6. what added value should your retailers offer?

IT IS YOU WHO DECIDES WHICH NEW OPPORTUNITIES YOU ARE GOING TO CREATE (voorbeeld ) 33

Tips for optimising your distribution chain.

Organisation & strategy?.

1. Tear down the wall between marketing & sales2. Build up your own expertise!3. Start building online consumer profiles in order to be able to communicate 1-1. 4. Focus on what IT/Internet can currently do for online lead generation ?5. Transform marketing communication (branding) into lead generation machine (btc!)6. Organise lead follow-up inside your organisation. 7. Take over communication with consumers from retailers. Use effective online resources

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Collaboration with dealers?.

1. Think about the role of IBD’s? Make dashboards that evaluate their performance2. Set clear objectives for each individual IBD. 3. Make unique propositions of IBD’s clear for consumer ( targeted locally)4. Use short term contracts in these rapidly changing markets

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Managing retailers based on online KPI’s?.1. Support IBD’s with local marketing and offset the costs against the margin. Accelerate!2. Change margins and set new kpi’s for the margin (race for rebate is a race to the bottom)3. Apply the booking.com model. The better the lead follow up, the more business an IBD

will receive from the manufacturer. The better consumers evaluate an IBD the more business is forwarded to this IBD.

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Building success together.