Jun 29, 2016

The valuable commercial benefits of joint retail promotions

By Paul Clapham

The term co-op promotions may not be well known to you and the concept may not be high on your priority list. One half of the problem with the concept is that it goes under several different names - joint promotions and multi offers as two cases. The other half of the problem is that it’s not easy and there’s no straightforward structure to work with.

That said, it’s worthy of serious attention because there are valuable commercial benefits to be gained. These apply to both winning customers and reducing costs and that’s a combination you don’t get too often in marketing activity.

Direct competitors
Let’s start with your direct competitors - other independent sports retailers in your town or part of a city. Would you cooperate with them to your mutual benefit and that of your customers? The very idea may be anathema to you. You may dislike them intensely and have no respect for what they do or how they do it. Equally, you may recognise that they have strengths you lack and, obviously, vice versa.

Let’s take summer sports. One of the above retailers is run by a tennis enthusiast and expert, the other is run by his cricket counterpart. But it’s a racing cert that both of them are stocking product for both sports. Does this make sense, given that the non-expert, non-enthusiast has to commit money and shelf space to product they’re not really conversant with?

Would it not make more sense for both retailers to focus on their area of expertise and agree that they won’t stock competitive mainstream product? I’m not suggesting you try to run a cosy cartel (however appealing that might be, it’s illegal). You just focus on your strengths. That in turn will improve your buying power and, hence, the offer you can make to customers.

This principle could work particularly well with developing lower profile, but growing sports. It’s not easy developing a small market, but it’s harder still if somebody else in your immediate catchment area is doing exactly the same thing. Over time you will both tend to destock ‘because it didn’t work’ and then the customer loses.

Other retail businesses
Let’s move on to other retail businesses in your area. Can you benefit from mutual activity with them? This requires that you go to them with an idea - it need not be brilliant, just practical and appropriate. The principle is that you drive trade to your commercial neighbours and they do the same for you.

What might apply? Try independent health food stores. With a broad brush take, you are in the same business, ie keeping people fit and healthy. If you think they’re a bunch of sandal wearing hippies, have a rethink. This is an increasingly mature commercial sector. I know because I also write for a magazine in that trade.

How would that work? Certainly, there’s no obvious quid pro quo at the retail level because of the significant price differentials. But the opportunity to share customers must be excellent. Lots of health stores sell supplements aimed at gym goers. You have a customer database and they do too. You may both have a loyalty card scheme. The opportunity to reach new potential customers through both is significant. You need a sharing mentality to make this whole idea work.

Insurance companies and brokers
What other commercial neighbours might feed you business this way? Think about anywhere that the health benefit is high. Insurance companies and brokers are an obvious example, assuming you do business with them. They get plenty of approaches, but if you have a clever idea they are inclined to listen.

Insurers use direct marketing in a big way, so they will have an organised database and be keen to develop it as much as possible. If they’re selling health insurance or indeed specialise in it, the fit is perfect. You could offer them a free money-off voucher to be used in your store. Your suppliers might be interested in this and increase the value offered if it’s specific to their brand. That is an approach that could be campaigned across a number of product areas.

Doctors’ surgeries
Do you have a doctors’ surgery in your locality? It’s just recently been announced that overweight patients will be prescribed exercise by the NHS. At the point of writing, the details are not spelt out, but there is every reason to imagine there will be business opportunities there. I strongly recommend keeping your eye on this particular ball.

Among those classed as obese are a growing number of youngsters, some of them as young as seven or eight. I suspect a combination of poor diet and overeating is the main cause, but inactivity will do it just as well.

I suspect, too, that teens and sub-teens are inactive because they haven’t yet found a sport they enjoy. They may well have been exposed to sports they disliked and that’s part of the problem. Being a source of ideas and recommendations of where they could try new sports could get you recommended. Remember that lots of people have no idea what’s available or where.

If local doctors can recommend an activity expert (ie, you) you would benefit enormously. I should add that some of the health food stores I’ve spoken to have said that they get referrals from doctors, so why not referrals to healthy activity specialists? You may find that district nurses who visit people at home or visiting carers funded by social services would give you access to those who need to get active.

Given that 47 per cent and rising of the population is over 50 years old, this is an important business sector and, if you can be referred to them by any or all of their professional back-up team, you wouldn’t need to do more marketing to reach them.

Leisure partners
As well as co-op partners where there is a health link, there’s also the fun aspect to consider. Since the 18-30 age group is considered the most fertile for recruiting new players, focus on them.

They probably meet and mix in a local pub and plenty of landlords are keen sports fans. I used to drink in a small pub that had a football team, a cricket team and a running team, as well as two darts teams. Find that pub.

You can instantly see the commercial potential from team kit to individual kit needs. That pub might well develop into other sports, such as a five-a-side team. Look for multiple purchase opportunities and aim to support the team.

You could offer a discount on clothing and other kit bought by individual team members, but the value of that discount can go to the team. You can be decently confident the bulk of it will come back to you.

On the other hand, the teams in that pub might wish to turn that cash into a beer fund. You might be disappointed by that, but you would be associated with them enjoying themselves in the broadest sense and it would be far more of a co-op promotion.


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Leone 1947

Leone 1947

, Midlothian-Edinburghshire

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