Last year Coyote Insight, my research and marketing consultancy, completed its first annual Coyote Insight Dealer Audit (CIDA). This study reflects the views of sales floor management toward the brands and companies whose products they are expected to sell. (Please visit www.coyoteinsight.com/ syndicated_studies for more details.)
I purposely use the word "expected" because as all of you in retail well know, there are a variety of opinions regarding these companies and their brands, all of which help determine which you will and will not support.
For better and worse (it can be both at once), the fate of CE brands is ebbing and flowing not so much because of what the manufacturer does, but rather because of what the sales floor is doing or not doing. There simply is not enough money for national media to overcome what the sales floor thinks and how it influences consumers. As a result, we believe that CIDA represents an invaluable tool in relaying the sales floor view to our clients.
To begin, this is not about absolute winners and losers, even though the report includes numerous ratings, which form a “report card” for manufacturers and their brands. It is the sales floor managers' chance to “speak” directly to the manufacturer, telling them how they feel the company is doing in meeting their needs. Moreover, in many cases, this is not the same message that the buyers and merchandise managers send to the manufacturer, particularly in the larger chains, because their corporate view can be quite different from that of their sales floor managers.
So what did we learn?
• Brands that are perceived to be dominant by virtue of having greater consumer awareness are not necessarily the brands that the sales floor will support or recommend most often. Indeed, while still acknowledging and needing the power of the large “pull" brands, the sales floor nevertheless chooses to support what its considers to be worthy brands. A case in point is JL Audio for car audio.
• Being acknowledged as a brand consumers frequently ask for does not necessarily translate into winning dealer recommendations. While CE dealers say that Sony home video products are requested by consumers five-to-one over the next closest brand, they are no better than dead-even with three or four other brands as “most recommended” to consumers who ask the dealer for advice.
• However, sales floor management will support brands that consumers demand, even in the face of doubts about that brand coming from the industry. Kenwood car audio came in second place as the brand most dealers would like to add to their stock assortment. Why? Because it is also recognized as being ahead of all but three other companies as a “most requested” brand of auto sound among 16-year-olds to 25-year-olds.
We tell our clients to be aware of the “third leg of the manufacturer/retailer triangle,” in which vendors represent one leg, the buyers and merchandise managers are the second, and sales floor management, which we believe is of the greatest importance, is the third. Our clients generally do not need us to tell them what the buyers and merchandise managers are thinking and doing, but they do not see the floor situation as clearly, and that is the view provided by CIDA.
We begin the third iteration of CIDA this coming spring and the data from that study will become the foundation for tracking the changing fates of brands on the sales floor. We thank all of you who have and will participate. We look forward to hearing once again, not only what you think but also what you will do as a result. Rest assured, the manufacturers are listening.