Monday, January 9, 2012

Sales Channel Engagement & Loyalty Principles

Chapter 1:

Once upon a time in a small village in India, lived a potter who had 4 daughters called,

  1. East Devi,
  2. West Devi,
  3. North Devi, and
  4. South Devi.

Every day, the potter made 20 pots. And each daughter carried 5 pots on her head and walked to the four corners of the village. They sold each pot for one rupee and every evening, each daughter carried 5 rupees back home collecting a total of 20 rupees a day for the potter.

The potter only made twenty pots each day, because each of his daughters could carry no more than five pots on her head.

Chapter 2:

One day, East Devi was approached by a stranger who made her an interesting proposition. She described this over dinner to their father, the potter.

East Devi: I was approached by a man who said that he could buy all of my five pots for 2 rupees each instead of 1 rupee. This is because he can sell them for a much higher price in the neighbouring village, Ram Gaon.

However, he has a broken arm and cannot carry loads. So he needs me to carry the 5 pots for him to Ram Gaon.

I can make 10 rupees a day instead of 5 rupees. But I will have to spend the day carrying pots for him to the Ram Gaon instead of selling them in our own village. Besides, my chappals are torn so I need new chappals to walk so much every day!

Potter: That sounds good. We can make 5 rupees more every day, and I can make you chappals from the leather than I had bought from the fair last Diwali.

So it came to pass that the Potter made East Devi chappals and she helped deliver pots to Ram Gaon. The family’s income went up by 5 rupees a day and they were all very happy.

Chapter 3:

About a month later, West Devi was approached by a stranger who made her an interesting, albeit very different proposition. She described this over dinner to their father, the potter.

West Devi: I was approached by a man from Lakhan Gaon. While he offered me our current price of 1 rupee per pot, he offered to buy 10 pots every day, instead of the five I sell, because people from Lakhan Gaon love our pots. He is also very strong, and he can carry all ten pots to Lakhan Gaon himself! So I don’t have to carry them like my sister.

However, since he will spend the whole day carrying and selling pots, his condition is that I should cook food for him. So every day, while he is in the market selling pots, I will have cook food for him and take a lunch box to him so that he can eat when his work is done.

So I too can make 10 rupees a day instead of 5 rupees but will need a lunch box to carry his food. Can you make me a lunch box, father?

Potter: That sounds good. We can now make five more rupees. And I can make you a lunch box from clay and wood that I can get from the forest.

So it came to pass that the potter made West Devi a nice lunch box and she helped deliver lunch to Lakhan Gaon every day. The family’s income went up by an additional 5 rupees a day and they were all very happy.

Chapter 4:

A month later, North Devi was approached by the temple priest. She described her conversations with the priest, over dinner with her father, the potter.

North Devi: Dear father, the temple priest met me today. He uses one pot every day to plant a tulsi sapling. And he then gifts the pot with the tulsi sapling, as a special blessing to one person every day.

He is aging and finds it difficult to keep up. So he told me that we would be willing to pay 10 rupees for just one pot. However, I would have to spend the morning with him to fill the pot with good soil from the field. Then select a good tulsi sapling, plant the sapling in the pot, recite the holy mantras (prayers) and then deliver the pot with the sapling to the home of the person he chooses that day.

I would love to do this. But, father, you will need to teach me holy mantras and how to plant tulsi saplings.

Potter: That sounds very good. We can now make five more rupees. And I can teach you all about planting tulsi saplings and mantras. My mother taught me and I still have her book of all prayers that I can give you. You will also earn some blessings for our family.

So it came to pass that the potter taught North Devi mantras and the art of nurturing tulsi saplings and she devotedly helped the temple priest. The family’s income went up by an additional 5 rupees a day and they were all very happy.

Chapter 5:

By now some villagers started missing the lovely pots that they were so used to buying from the potter’s daughters. With three corners of the village now not being served, things were getting complicated.

Among those who missed the pots, was a very sharp kirana shop owner called, Mr. New Channel. Mr. New Channel had four sons who had completed their schooling and were now looking for work.

Mr. New Channel was very sharp and quickly learned about why the villagers were getting an irregular supply of pots. He called his youngest son, Liaise Singh who was good friends with South Devi and whispered something into his ears.

That evening South Devi shared her experiences with her father over dinner.

South Devi: Dear father, I spoke to my friend Liaise Singh today. He presented me with a proposition from his father. Liaise Singh and his three brothers would like to start earning a living. And they can help us make us all more money too!

Our fellow villagers are missing our regular supply of pots. Mr. New Channel is willing to buy 20 pots from us every day at fifty paise each. His four sons will carry them to the four corners of the village and sell them for us, just like my sisters and I were doing a few months ago.

And instead of me earning 5 rupees, we can now earn ten rupees by selling 20 pots to Mr. New Channel.

Also dear father, you’re growing old and also spending so much time helping my sisters with chappals, or making food boxes or teaching them mantra’s. I’ll spend my time making the pots and you can rest all day.

But you’ll have to bring me clay from the forest every day to make all the pots.

So it came to pass that the potter brought clay every morning for North Devi who made beautiful pots. And while Mr. New Channel’s son’s sold 20 pots in the village, her sisters sold pots in their own unique ways with support from their father.

The family’s income had now doubled from twenty rupees to forty rupees and they were all very happy.

Over dinner one night, the potter remarked, thinking back on the events of the last six months.

Potter: Hmm! I spoke to my brother in the city who has an MBA about what has happened with our pot-making business. And in his own style he described how the core driver of our success has been, “Relevant Engagement.” He said,

East Devi got us double the price but needed transport support

West Devi got us double the volume but needed meal vouchers

North Devi got us into a pottery solution but needed training

South Devi helped us scale operations but needed price discounts

Each of you has doubled your income but so very differently!

Moral of the Story:

One-size-fits-all approach to Channel Loyalty Initiatives rarely succeeds.

Channel Engagement programmes are not about rebates and discounts only. Nor are they about doling out gifts and freebies.

A strong engagement initiative begins with a candid situation analysis and empowers your channel partners to succeed with respect to needs of their customers in turn.

Designing this may be difficult and time-consuming and requires effort to gain insight.

But the result is Strong Relevance and alignment of resources towards mutual Win: Win.

Channel loyalty manifests itself as an outcome.

1 comment:

  1. Very relevant and engaging indeed!

    I was expecting a more radical end, where one of the sisters/devis is propositioned by a trader for all her skills, intelligence and ofcourse beauty. The result is a retail outlet for the pots along with other home and decoration stuff.

    The business analogy being the 'marriage' of ideas with the client to create newer revenue streams, channels, engagement models and tie-up applications of the basic product.

    Best Regards