| Vital Stats:
The Asssociation of Sales and Marketing Companies' (ASMC) membership
comprises nearly 1,000 sales and marketing agencies employing more
than 40,000 professionals and servicing all classes of trade for the
thousands of clients they represent worldwide. In addition, the Association
promotes the interests of some 200 Associate member manufacturers,
including their subsidiaries, that use sales and marketing agency
representation in local markets, as well as dozens of Allied members
that serve constituent companies.
The Challenge | The Solution
| The Process | Unintended Consequences
| Unforseen Benefits | Measurements
& Results | Lessons Learned
The Challenge
How could the association reinvent itself to remain viable in
a changing commercial environment?
Between 1996-2000, NFBA membership consolidated from 1,700 members
(employing 20,000 employees) to 360 organizations (employing 50,000
employees) representing 55% of the food that is sold in the nation's
grocery and food service organizations and expanding into new areas
including drug stores, convenience and other trades.
Challenges facing the association included:
- Industry consolidation
- Customers' changing purchasing strategies toward centralized
purchasing
- Anticipating market changes
- Providing more relevant services for consolidating membership
- Identifying new applications outside the traditional food service
and grocery business
- Streamlining marketing and product delivery costs
- Promotion by manufacturers of the best use of their sales/marketing
agencies
- Cultivation of knowledgeable alliances among sales/marketing
agencies
The Solution
To create a new name and "battle banner" under which
all participants of this business could see themselves, relate to
the new identity, reaffirm the value and understand how they might
extend their services to new industries.
Challenge
With the advent of computerized scanning, sophisticated sales and
marketing programs, industry consolidation and the eternal search
for streamlining costs and movement of product to and from the shelves
of America's retail climate, the organization realized the need to
reinvent itself to remain viable in today's environment. The notion
of the "value" of the middleman was in question as manufacturers
and retail outlets attempted to streamline and reduce the cost of
entry into markets and the cost of shelf space.
Opportunity
It became apparent that there were opportunities for different kinds
of alliances and services, but no way to pursue them within the current
structure. The association needed to become a greater advocate for
its members - including aggressive identification of newer applications
outside the traditional food service and grocery businesses, where
their knowledge of consumer preferences, shelf and supply chain management
could be put to better use for all parties. Many members identified
so closely with grocery and food service and didn't see their skills
more broadly applicable in the drug, electronics or other retail industries.
The Process
The re-branding initiative was implemented in a two-step
process that focused on the creation of a new name and detailed re-examination
of member needs, association services and processes.
Step One: Creation of a New Name
The Association of Sales and Marketing Companies
The Food and Consumer Goods Connection was approved as the new name
by the board in July 1996. The design, plan and budget was presented
at the September, 1996 meeting of the board and the program was unveiled
in December 1996, to become effective in January of 1997.
The tag line, "The Food and Consumer Goods Connection"
provided the bridge between the old and the new; and gave members,
customers and the media a better sense of what the association had
to offer. The goal was to articulate core competencies, show the broader
relevance of the association's members and begin an aggressive program
that built new demand.
The process involved the following steps:
- The Vice President of Marketing and Member Services convened a
small working group of a marketing communications firm (Page Group,
Bethesda, MD) and a public relations consultant (Ronald Margulis,
RAM Communications, Westfield, NJ) with deep roots in the food industry
to assure that the messages and images resonated with the membership
- Development of the new logo and message
- Preparation and hosting of a celebrity launch, which included
a detailed media plan to position the organization as the source
of relevant insights regarding the marketplace, well beyond the
food and grocery industries
Step Two: Re-examination of Member Needs and Association Services
Pursuant to a detailed examination of member needs and association
services, which involved making determinations on what elements needed
to be outsourced or charged directly to staff, it was determined that
the ASMC could provide greatest assistance to members by:
- Providing advocacy for the membership
- Aggressively pursuing marketplace expansion and awareness efforts
- Providing a sophisticated understanding of current information
technology and tools to help streamline business relationships and
information needs
Overall, the re-branding process culminated in the following tangible
results:
- A new design and product standard to create an elegant and distinctive
look
- The traditional bag of samples and gifts passed out at convention
and meetings was replaced with distinctive reminder products, as
well information about new services that members could use (e.g.
research or new promotional tools to assist their retailers in developing
profit on the purchase side, as well as on the retail sale)
- The organization began to tailor research and develop new customized
tools (such as loyalty or other business to business sales) for
members to use with their specific market and product menus
- ASMC is also analyzing and helping members understand the applications
of new technologies
Unintended Consequences
Limited Resources
The development of the two-year plan required 100% of the vice president
for marketing and member services for 5 months, a dedicated internal
support system, as well as $250,000 for materials and contractual
services. In retrospect, the job might have been easier if there had
been more budget requested, allowing a deeper reach to the membership.
A Phase II program will be in place January, 2001.
Unforeseen Benefits
Unforseen benefits of the initiative included:
ASMC re-branded the association and the members at the same time.
What started out as a good idea became the foundation for long-term
brand identity. The members went from being just brokers and agents
to becoming established in other industries (such as computers and
consumer electronics) for their core competencies of sales and marketing,
rather than the site where the sales happen.
The board structure was reconfigured to more accurately reflect the
range of businesses represented, as well as the new industries needing
the sales/marketing assistance.
Announcement of the name change allowed ASMC to nurture broader networks
with the business press, including the Wall Street Journal, to help
articulate the benefit to the business decision makers outside the
food industry. However, many of these media efforts didn't reach mid-
to smaller organizations to help them understand the name change and
the benefits. A broader, more consumer-friendly approach may need
to be deployed in future efforts.
ASMC began to outsource more analysis and services, rather than maintaining
in-house capabilities.
The dues structure changed to a sliding scale with a cap and ASMC
moved from a classic representation model to an advocacy, business
development and consultative model.
The repositioning provided an opportunity to adjust so that marketing
representatives might also be included in the membership mix - - an
expansion well beyond the current template.
ASMC developed a code of ethics and a white paper on the importance
of maintaining industry standards.
ASMC grew a consultative practice within the association to help
new industries attempting to break into retail outlets position their
products and learn how to use their member's expertise more efficiently.
Measurements & Results
As a result of the re-branding initiative, ASMC members now have
a greater level of respect and understanding for their core competencies
and are being sought in other industries outside food and grocery
for their sense of how to solve some of the big problems associated
with retail sales, including shrink (disappearing goods), more careful
targeting of promotional efforts, amount of shelf space and positioning
to introduce products to key markets.
Success was defined by the following criteria:
- Member acceptance and appreciation for new identity and services
- The ability to gain new market share and growth over the five-year
period
- A significant increase in market power and revenue, despite consolidation
of numbers of entities providing the service
- The ability to use the impetus of a name change to provide an
expansion plan for new members
- A governance strategy that allowed all parties to maintain control
of their educational and business development priorities, while
maintaining a link to a broader group that offers them a full menu
of insights
Revenue
While it is difficult to track revenue "generated," the
association has held its own in a highly competitive climate where
consolidation has managed to shrink 1,200 members to 360, and have
been able to help members generate greater revenues and explore new
business opportunities, markets and business alliances for the association
as well. It would have been better to have more of a budget at the
outset so that efforts could have reached deeper within the membership
to explain the benefit and the opportunities.
Lessons Learned
ASMC capitalized on a crisis in market dynamics and used a tight
time frame and a group of dedicated board members, consultants and
staff to develop a reengineering solution that made sense and worked
backwards to the implementation steps. The secrets of success included:
- Having the right people in play at the beginning
- The flexibility to move quickly
- Decisiveness: Conventional surveys were not giving them information
they needed to make necessary decisions. They jump-started the process
by bringing all parties to the table and hiring consultants that
had an established track record in the industry, to avoid any mis-starts
- Be prepared to not win any popularity contests while you are fostering
a cross functional team in a traditional association business
- Overcome resistance by communicating the long-term vision
Dealing with Resistance
Resistance is more often than not due to not understanding where they
fit in the long-term vision. Remember that everyone learns differently
and incorporates information through different vehicles or endorsements.
The core group of members heard, understood and accepted the change;
but other mid- to small-size members representing smaller manufacturers
and family-owned operations didn't get the word or fully appreciate
the implications of the change. So an important lesson is just because
people around you get it, better check farther and deeper to make
sure the information has penetrated the membership's experience.
The most important lesson was using the opportunity of a name change
to think totally outside the box and re-invent the association. Perhaps
the most difficult challenge for the staff was the fear of letting
go of old processes, products and services that have served them well
over the years. By thinking outside the established boundaries of
the business the organization was able to find new venues for their
members in the chain drug story, computer and consumer electronics
industry.
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