Channel Conflict

Channel Conflict Case

Situation

A 120-year-old American manufacturer of memorabilia primarily known for its production of yearbooks and class rings for various high schools and colleges, as well as championship rings for sports. 

The company was looking to generate an additional product revenue stream and had recently developed a photo memory book line with products developed and geared for the high school market. 

Challenge

There were several challenges. 

  1. Approximately a year prior, the name of the photo memory book was created. The name did not resonate with the target audience. The name was an older term which also did not indicate anything about the product. The name often needed to be repeated and left a question mark in the prospects mind as to what it actually meant.

  2. The high school students were the chosen target market, and so a large selection of higher end book covers were created which were geared to high school sports such as basketball, football, soccer etc.  The research was done regarding the high school market and it was determined that ‘mom’, rather than the student was the target audience due to the fact that she held the ‘discretionary income to purchase’. However, during this time, the target audience was still challenged by the actions of ‘upload content’ and therefore led to hurdles of educational content to be developed.

  3. Additional hurdles were uncovered that revealed the sales channel to the high school market was ‘independent reps’. The yearbooks they were currently selling provided a large commission per book, but the photo memory book line would only provide a small commission. Hence, the reps did not focus on the photo memory book line, as they did not want to hurt their main source of revenue.

  4. Additional agreements had been made with non-profit groups geared to kids and activities. Some of the engagements made were to groups that had a base of members that had no discretionary income for photo memory book purchases, and other engagements whereby the photo memory book company had to do all the marketing for the engagement to get traction from the members of the group. 

Solution

  1. Name: Recommendations were made to change the name and call it by the parent company name and then ‘photo memory book’ to remove confusion and align more with the corporate brand.
  2. Target Market: Qualitative and quantitative research was done on the college market which revealed not only the size of the market but average discretionary spend, and digital engagement. The college student market not only had the pictures/content available on their phones but also had the discretionary money to make photo memory book purchases. Focus research groups proved this group was also more apt to create memories. 
    1. Further segment work was done to outline the fraternal sector in colleges across the country which provided a wealth of opportunity. 
    2. Additionally, top Universities were outlined to provide a co-branded product approach. Product focus groups were set up to provide information for the product development team to create products for the college market.
  3. Rep Channel: The college sales reps were employees of the company and were given quotas to sell the photo memory books as part of their line when speaking to the colleges that they were enlisted to service. Multi-touch marketing campaigns were created to go out in product shipments, communicate on the college sites as well as individual mailings to increase awareness and business in the college channel. 
  4. B2B Engagements: Negotiations took place to end poor agreements that were not profitable and that were not geared to the target audience. New financially sound agreements were put into place with groups that provided their own marketing to drive awareness and adoption. First alignments with cities, Universities for co-branded products and the first wholesale agreements were created. 

Result

The new model for selling the photo memory books aligned more fully with their employees, their customers and their brand. 

  • Thousands of dollars were saved by ending poor B2B agreements and creating new ones.
  • Product development, marketing and sales changed direction and became aligned with the efforts to drive the additional revenue stream. 
  • Banner ads were created and delivered through college and affiliate marketing channels.
  • Co-branded products were introduced for both large destination cities driving visitors and also colleges driving student engagement.
  • The first wholesale engagement was set up to go into the high school market with the high school geared products that had been previously developed. The independent reps were compensated a % of the sales that the wholesaler secured. The wholesaler obtained the picture content from the students and created and delivered the completed books.
  • Multi-touch marketing campaigns were put into place to continue to drive awareness, build the brand and increase the sales of the photo memory books.
  • A roadmap for the college market target fraternal segment was created to present to all sororities across the US for co-branded products.

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