NMBS Conference 2014: How to make the most of your brand

Published:  20 June, 2014

Mike Rigby, managing director of MRA Marketing, has been advising construction industry clients on how to get the most out of their brands for many years.

Mike Rigby, managing director of MRA Marketing, has been advising construction industry clients on how to get the most out of their brands for many years.

"No company is the same," he began by saying. "Every one has different barriers that stop it from growing."

Mr Rigby urged companies to "Think Big" - to start with what you want to achieve, whether that's growth or brand repositioning, and then work backwards, creating a realistic plan of how you're going to achieve it.

He noted that most companies just keep pace with the market they're in, expanding and shrinking inline with the economy of that market, but he believes that strong branding and marketing can help businesses buck the trend and grow themselves regardless of the state of their market.

He warned, however, that the industry faces some real challenges with its branding.

These include commoditisation, where products are reduced to simply competing on price without factoring in any margin for their quality or reliability.

He also said that while it might be relatively easy to get a product specified on a project, keeping that specification intact while the project goes through the supply chain, and is altered by architects, merchants, distributors and installers, can be far more difficult. Here, he said, branding can help by creating a reputation for that product which will make people more inclined to want to use it. This also extends to the homeowner, since a strong consumer brand will encourage consumers to demand that those particular products are used in their homes.

At its heart, Mr Rigby said, your company's brand is who you are, how you look and what people think of you. Merchants in particular are on the frontline of the supply chain, and frontline marketing is "harder than it looks". He noted that some merchants think marketing is something that their suppliers should do for them, not what merchants should be doing for themselves. He said that while merchants can expect suppliers to help create demand for their products, that trade marketing is harder than consumer marketing. This is because the company has to engage with different audiences across the supply chain who all want different things, and that it has to do all that with a far smaller budget than is often seen in consumer marketing.

"Most trade marketing is underpowered," he said.

He also warned delegates against creating too many brands. "Creating a new brand is easy, but they all then need constant looking after. The more brands you have, the more money you need to keep them going."

The merchant industry as a whole also needs to work on its brand identity, said Mr Rigby. He drew attention to the Green Deal and a recent luncheon where a government minister, when asked where independent merchants played a role in the Green Deal supply chain, did not know what an independent merchant was.

"We have to take some responsibility for promoting ourselves and the issues that matter to us. That's what marketing is for."

As part of the Conference, MRA Marketing was asked to conduct a survey to find out what merchants and suppliers think about marketing, as well as to learn how each would rate the other's marketing efforts.

The company conducted 154 phone interviews - with 121 builders' merchants and 33 suppliers. Merchants rated suppliers well on products, but less well on branding, with independent merchants in particular saying they wanted more supplier investment on brands.

While most merchants questioned recognised that brand recognition is important, one in five surveyed said people "didn't care about branding, only about price", and that "brand doesn't matter as long as the product does its job".

But Mr Rigby reminded the delegates that builders may work in the trade, but that they continue to be brand consumers in their private lives, and will bring those buying patterns and behaviours across into their work as well.

"Whoever tells the story, wins the battle of what people know and remember, and that is what will boost market share," he concluded.

The full survey report will be available to download for free on MRA Marketing's website - http://mra-marketing.co.uk - at the end of July, 2014.

Mike Rigby's Masterclass: A Practical Example of Marketing

Following his presentation, Mr Rigby also conducted a Masterclass for those delegates who wanted to learn more about the financial benefits that marketing can have on their businesses.

He began by examining some of the myths that people mistakenly believe about marketing. While many merchants believe that they can leave marketing to suppliers because you need a big budget in order to achieve good results, he said in fact you don't need a big budget to affect positive change.

With the customer experience lying at the heart of the buying process, making simple changes to the way customers interact while in your branch can encourage them to purchase more each time they visit.

"Merchandising is not just about racking - it's a marketing tool that will help you to present your products in the best light and help you to sell more," he said.

He advised the listening delegates to ask some key questions about their customers, when looking at how best to sell to them, including:

  • How old are your customers?
  • Are you selling to the type of customer you want?
  • How and where do they buy most of their products now?
  • What is your customer's experience of your store?

Mr Rigby then gave delegates an example of a merchant who has used marketing, along with a fundamental change in the way they laid out their branch, to change the perception of the business among its customers and to increase sales.

EH Smith recruited MRA Marketing to redesign and rebrand its Shirley branch, with the aim to double collect sales within three years.

Before the rebrand, Mr Rigby said the Shirley branch had a number of issues:

  • There was little product choice, with many gaps visible on the shelves for customers to self-select, although there was a lot of stock in the warehouse.
  • The branch had a big brick library but, again, little self-selection available
  • Poor lighting and signage
  • Long queues at the trade counter while people negotiated prices with counter staff.

MRA Marketing conducted focus groups and exit interviews with EH Smith's customers, asking them what they thought of the branch and what changes they would like to see. These surveys revealed that many customers were coming into the branch to buy one thing, then going elsewhere for other products that they needed.

To improve the business, EH Smith increased its selling space, opening up much of the yard and warehouse into self-selection areas where customers could browse. Stock volumes were also increased dramatically, with the introduction of a "good, better, best" pricing structure.

"The more choice and space people are given, the more they will buy," explained Mr Rigby. "Giving people a choice of pricing levels also encourages people to upscale what they buy, as people will tend to choose the 'better' or 'best' option."

Add-on services such as paint mixing and a cutting service were also introduced to help customers, as well as a catering van outside where people can purchase bacon rolls and tea or coffee.

The pricing structure was reset, with no more haggling taking place at the counter in order to clear the bottle neck and reduce queuing time. Instead, shelf-edge prices were introduced, with core products having competitive prices in order to give customers the right cues that the branch offered good value for money. Prices were then balanced across the rest of the ranges to protect overall margins.

Clear signposting helped customers navigate the store, with further signage highlighting the brands available in store, with products being grouped by projects, and kept close to all associated ranges.

"You have to think of the customer journey," said Mr Rigby. "people buy for projects, not single products. If you group products near accessories and other associated stock you'll prompt people to buy more."

Impulse purchase products were placed near the counter, with workwear displays being introduced to encourage customers to browse, again encouraging add-on sales and boosting margins.

The branch was officially re-opened in May 2013 with a strong launch event and an associated 'Proper Builders' Merchant' marketing campaign. This ran for several months to keep momentum going and had a strong social media presence on Twitter, along with TV and print coverage.

Following the relaunch, the branch's like-for-like sales were up 32% to March 2014, and the new business model is now being rolled out to other EH Smith branches.

EH Smith's marketing director Mark Mallinder hailed the rebrand a success, adding that it has "provided a growth roadmap for EH Smith for the next 10 years."

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