Distribution Strategy Group conducted an electronic survey with Modern Distribution Management in September 2016 of 425 participants to better understand trends in distribution marketing.
Summary
- Marketing initiative performance
- Distributor marketing lags as only 4% of respondents are high performers in marketing compared to 18% out of distribution
- Vehicles and channels
- Digital marketing (email, search marketing, and social media) usage has increased significantly since 2011
- People and in-store (display merchandising, branch events, trade shows, telemarketing) have decreased significantly except for telesales
- Mass media (radio, TV, outdoor media) have increased significantly as a percentage, but still remain small overall
- Print marketing (catalogs and flyers) have remained about the same from 2011 to 2016
Distributor Marketing Lags
- Other sectors as shown in SFDC survey have a much greater percentage of high performers.
- Distributors have an enormous opportunity to gain competitive advantage through development of a high performing marketing.
B2B Digital Marketing Impact
- Digital marketing leaders have much stronger revenue growth, EBIT growth, and return to shareholders than companies without strong digital marketing.
- This parallels results from the 2016 Distributor Marketing Survey.
- Significant increase in digital marketing
- Moderate decrease in person to person/in store except trade shows
- Increase in print catalog
- Significant increase in mass media
Big differences between high performers and the rest of the respondents:
- Much greater percentage of high performers do email, search marketing, and social media at least weekly
- High performers are much more likely to do telemarketing
- The rest of the respondents are more likely to do annual or quarterly trade shows
Print remains popular among all respondents, however a smaller portion are doing flyers annually or quarterly.
Display merchandising has decreased significantly since 2011 with minimal differences in high performers vs. the rest of the population.
Branch/store events have declined in usage since 2011 with minimal difference between high performers and the rest of the population.
Survey Respondents
Respondent Annual Revenue
- Nearly 50 percent of respondents were small distributors with less than $50 million revenue.
- Over 40 percent of respondents had $50 million to $500 million in revenue.
- The remainder were large with more than $500 million revenue.
Company Description
- 60% distributor
- 27% manufacturer
- Others included:
- Buying group
- Association
- Manufacturer’s rep
Respondent Business Sectors
- About 60% industrial
- 28% are safety or electrical
- Over 20% are HVACR/plumbing, oil and gas
Branches/Stores
- 16% have no store
- Half have 10 or fewer stores
- 14% have 10 to 25 stores
- 9% have 25 to 100 stores
Respondents by Job Function
- 58% executive management
- 18% marketing
- 10% sales
- 11% general management
