Sales Distribution Channel 1

24th February 2023

Get to Know me Better 2

• 2008 Batch from IMT

• Handled multiple roles in the field of Sales
and Distribution
• Currently Head of Trade Marketing in
Guiltfree Industries (RP Sanjeev Goenka
group)
• Helped shaping Distribution and Trade
Strategies in Henkel, SC Johnson (All Out),
Emami and RPSG group
• Worked on Brands All Out and Baygon as
Senior Brand Manager
Channel- what does google say? 3

1st Hit 2nd Hit 10th Hit

We will talk about… 4

What are Distribution Channels?

How companies revamp distribution

E-COM Leverage & Digital Strategy

Alternate strategy for niche brands

Through real life examples

 What is a distribution channel? 5

The path a product takes to reach the consumer is called

channel

A ROBUST DISTRIBUTION
CHANNEL IS THE BACKBONE FOR
ANY COMPANY
The most important P? 6

• If the product is not available- there is

no sales however excellent the other
Ps are

• Every availability in a channel comes

with a cost- that’s a tradeoff every
strategy has to navigate
 What is the role of channel? 7

Megha, Sector 10, Too Yumm Chips Factory in Kolkata

Noida
Type of Distribution Strategies: Direct Selling 8

• Pro:
• Direct
relationship
with clients
• Higher margin
• Simplicity
• Con:
• Not Scalable
with volume
• Service
timelines
Suitable for customized businesses with very high profit margin bound to suffer
• Have to rely on
Famous Examples: Amway, Tesla, Apple in USA high traffic/
demand
 Type of Distribution Strategies: Key Channel 9

• Pro:
• Higher volume
for reach
• Client data
access for
analysis

• Con:
• High margin
erosion
• Huge
Suitable for niche brands and startups dependence on
few players
Famous Examples: Crème 21, Hammer, Dr Vaidya • Low reach
 Type of Distribution Strategies: Full Scale 10

CFA • Pro:
• Full scale reach
Distributors • Can manage
high volumes
• Negate
Sub-stockiest competition
action
Wholesaler
• Con:
Retailer • High
investment
Must have for all top FMCG brands • Complicated to
manage
Famous Examples: All FMCG companies • No dedicated
feedback
WHAT ARE THE DISTRIBUTION CHANNELS in
FMCG? 11
Other Channels: 10-20%
General Trade: 80-90%
 How does the margin structure look like? 12

END -CONSUMER RS 50
16%
Margin
RETAILER RS 45.5 per
product
sold

DISTRIBUTOR RS 42.3

Trade Schemes/ CFA/ SALES AND

Displays Total margin given on MERCHANDISING
Channel the product ranges to TEAM
Incentives 25-30%
Urban Distribution Basics 13

DB

DB
CFA
 Rural Distribution Basics 14

In a fragmented market like Rural India we need a span

District Nashik:
breaker called Super Distributor
Population- 61L
How to track distribution in a town 15

The principal objective for any sales

function is distribution
Outlet Universe: 20

Category Outlets: 15
AC NIELSEN
Company Outlets: 10

Direct Outlets: 7 COMPANY

SOFTWARE
Effective Coverage: 5
Distribution in towns- Order booking 17

Salesman has a fixed route for the day

that has 25-40 outlets

He books order in said outlets- say 20

Order Flows back to distributor

Distributor delivers the stocks next day

What factors determine your channels? 18

Think of Apple vs Xiaomi

MRP TARGET MARKET

AUDIENCE ASPIRATION

SHELF LIFE BRAND EQUITY PROFITABILITY

DISTRIBUTION REVAMP
19
Emami “Star-struck” Brands

20
Emami : Strong presence in WS 21

• Pre- 2017:
• Emami had a total coverage
to 40 L Outlets as per
Nielsen

• Had a very strong presence

in WS- banked on brand
equity and Pull from Market
Emami banked on heavy advertising, brand pull
(45% Channel contribution) and demand from Wholesale channel
• Highly cash and trading
dependent market
Nov’16: Everything Changed 22

Emami was hit the hardest as

cash dependent WS channel
collapsed in the month

Even in subsequent months

channel never fully recovered

What did Emami do??

Relook at direct distribution
23
Emami Others
Way Forward Planned: Match competitors in coverage
24
Improve
Coverage by
2.5L Outlets

Urban 1 PROJECT
Lakh RACE

Rural PROJECT
1.5 Lakh DHANUSH
Why is there a coverage gap in top cities?
25

Distributor coverage area gaps Cost of distribution Output/cost in Outlets

A distributor covers roughly 40-50% outlets in his area- rest is catered through Wholesale
Urban: Picking
Should it be an all area
the right field activity?? Where to get
Which area
to target
maximum gains? 26

Do these outlets
How to sustain Performance How to exist?
momentum of Tracking of confirm Are they worth
project after these outlet covering?
outlets have been outlets presence How to find these
incorporated? outlets?

Who will
How much Manage cost look for Does current
additional cost of service these Salesmen have the
will be incurred outlets bandwidth?
to service?
Project RACE Inception
• Partnered with AC Nielsen to confirm outlets location
• Nielsen also shared towns with maximum gap 27
• Data validated by current Sales Team

• Decision to invest on additional salesmen dedicated to the

project
• Delivery to be strictly borne by existing Distributor

• Additional Position of Sales Development Executive

• Dedicatedly focusing on Expansion Priorities

• Outlets marked in System

• Continuous tracking in system

• Project included as key KPI for all Sales Force

• Supported by attractive incentives
RACE Roadmap From Nielsen data
clearly top 29 cities
Which area
to target
identified with the 28
biggest gap

Nielsen provided
RACE was made an Performance How to complete address
additional tag in Tracking of confirm of relevant outlets
system- continuous these outlet with landmark,
performance outlets presence updated contact
tracked for 3 years information and
GPS

Distributors bore
the entire cost of Who will Emami invested in
service- Manage cost look for 280 salesmen to
individually each of service these
outlets carry out the
query was resolved
project
 Dhanush Top 10 States
Roadmap Which contributing 83% of
area to Emami Rural Business 29
target

20000 towns of
Optimized based on Manage How 3k+ population as
distance, geography cost of much to per Census that
and type of vehicle: service cover were not directly
normalized 20% every covered
year

Who will
Extra 450 Van
Salesmen and 50
look for How to
VAN Team Leader these reach Ready Stock to
for better tracking outlets nullify order drop
 Nashik- After
Dhanush

• Mapping was done town

level on district maps
to form optimized van
routes
• Big dots: Super DB
• Smaller dots: Sub
DB
• Lines- Van routes

• Total Sub-DB – 23
• Total Towns covered –
269
• Direct - 5
• Sub-DB towns– 26
• VAN towns – 238
 31

E-commerce: New Opportunity

Pre-Lockdown
E-commerce: Perfect channel to build 32
niche brands
• Many well known brands today started only from E-Com and
became household names
Example 1: RPSG Group- HerboBuild 33

A niche product which needs

targeted communication to a
particular segment of
customers
HB Strategy 34

Focused Strong Excellent

Smart SEO Cohorts in Influencer follow up
FB Program on drops
Smart Search Engine Optimization 35

Worked extensively on
SEO with right
keywords for Early hit
 Facebook Targeted Ads 36

Anyone searching/visiting pages related to Fitness, Body building and Healthy food options are
targeted
Strong Influencer Program 37
Google Remarketing 38

For Non-buyers in
websites focused
follow-ups and
reminders
Emami Impact: StriVeda 39

A new category (Lactation

Supplement) built from
scratch
Strategy in Digital 40
Build Awareness &
Saliency amongst the TG
through interest targeting in
platforms where consideration
and buying intent is high

Build Relevance amongst the

TG through Content & Influencer
activation
Driving Saliency through targeted Google Search
41

Be present where consumers

are searching for solutions &
direct them to Amazon Page
Driving Saliency through targeted Search in
Marketplace 42

Be present where consumers are searching for solutions in amazon portal

Driving Awareness through Interest Targeting in
Facebook 43

Reach out to TG through interest

based targeting to drive awareness
and consideration

Reach Clicks CTR

12,32,006 35624 2.88%
Driving Consideration & Advocacy through Content Activation
Article Published in Fb
Fb/Insta Stories 44

Reach Engagement Views

28212 12k 27 link clicks

35 link clicks
32512 13k
1300 reactions
Reach Engagement Views
403543 9264 8486
Driving Relevance through Influencer Activation
45

Reach out to TG through

interest based targeting to
drive consideration & driving
advocacy

Reach Clicks CTR

5,00,762 56,709 11.32%
 ALTERNATE STRATEGY FOR NICHE BRANDS 46

Some Brands need an

unconventional
approach..
THE MAN COMPANY
47
PREMIUM GROOMING PRODUCTS FOR MEN
45% of Sales come from their own website
REST CHANNEL 55%
Modern Trade(20%) 48
• Outlets in Shoppers Stop, Central, Lifestyle

Corporate Sales(20%)
• Tie-up with Pharma Channel and Gifting

General Trade (10%)

• In key metro cities

Salon Channel (3%)

• In select cities

Exclusive Beauty Outlets (2%)

• In airports
 Trying to change the
definition of being “manly”
Targeted Adverts: International Men’s Day
49
Time for Flash Back….
50

Footprint E-COM Alternate

Expansion- Leverage: Channel
RACE and HerboBuild Strategy:
Dhanush and The Man
StriVeda Company
51