Distribution used to be about shifting boxes, until a few progressive companies changed the face of the channel by introducing value-added services, forcing everyone else to keep up or die a slow death.
Today, there is a similar fundamental shift with the changing dynamics of the channel brought on by changing customer – and consumer – demand, as well as a diversification of the means by which distributors can reach resellers and end-users.
“Technology, by its very nature, constantly changes and evolves. The channel has to keep up with these evolutions not only in terms of its offerings, but in terms of its approach to distribution,” says Simon Campbell-Young, CEO of Phoenix Distribution.
“Consumer electronics have always been the sexiest area of IT. Today, the industry is paying more attention to the aesthetics of its products as consumers are increasingly asking for more stylish, unique options to fit their lifestyle. The channel not only has to keep up with these trends, but has a great opportunity to transform. A new approach, when harnessed within multi-channel strategies, offer fantastic opportunities.”
Phoenix Distribution has embraced a multi-channel approach, reaching not only its own reseller base, but end-users, who are empowered by information via social networking and other online sources as well as unusual (for the channel) touch points such as music festivals and other multimedia tie-ins.
The company did a Beats By Dre sponsorship with the Stormers, and is in discussion with the Springboks to do the same – similar to the sponsorship the company provided for Bafana Bafana during the African Cup of Nations.
“It’s easier for retailers and resellers to sell to consumers who are already in the know, and consumers these days often have more knowledge about our products than we give them credit for. They are also increasingly becoming brand and fashion conscious when it comes to IT and electronics.
“To be successful these days, the channel needs to do all it can to get customers awareness up and use all the routes available to enhance the product messaging,” Campbell-Young says.
He adds that this underlines the need for the channel to do all it can to gain a deeper understanding of the customer through planning and marketing activities and ensuring that it reaches the right audience with the right message.
“We need to engage with customers the way they would like us to engage with them, whether in the store, online, or via e-mail, social media or their mobile devices.”
It’s become standard practice for vendors to use brand ambassadors and celebrity endorsements to promote their products. Those companies in the channel who have seen the need to transform their business to meet changing demands are right behind the vendors.
“The first principle of marketing is that you need to know who your customers are, and what motivates them. Instead of waiting for customers to tell us what they want, the channel has to start telling them why they want our products, in a language they can understand, and through routes that they will appreciate,” Campbell-Young concludes.