Retail: Merchandising: Down Among the Z-Men

Forget the middle-aged woman bearing a feather duster and cardboard cut-out, the computer retail industry has given birth to a new breed of merchandiser, says Andrew Charlesworth

Merchandisers don?t have the best of reputations among retailers. The image is of an army of middle-aged part-timers, one of whom arrives in the store uninvited and unannounced and returns every week.

She (and it is usually a she) tidies some shelves, ticks a few boxes on a clipboard and replaces the prominent display of product X with product Z.

Product Z is accompanied by six-foot-high cardboard cut-outs of Z-man, a clone super-hero whose face bears a passing resemblance to Z Ltd?s weaselly marketing manager on a body like Arnold Schwarzeneger?s. She puts a Z-man on either side of the product display and insists on leaving another one by the counter.

As soon as the store manager is sure she has reversed her Vauxhall Nova out of the parking space, he takes all three effigies of Z-man and puts them in the stock room. The Saturday staff find great amusement in using Z-man as a target for staple guns, until his face has almost as many craters as theirs. By the time the store closes, one Z-man has a Hitler moustache and an improbably large cartoon phallus drawn on him in black marker pen. The other two have been cut up and used as packing for a local delivery.

When Z Ltd?s merchandiser comes back the following week, she asks the store manager what happened to Z-man. He mutters something about kids in the store. She reminds him that Z Ltd and his chain have a window display co-operative marketing agreement and that Z paid good money to have Z-man erected in his store. She makes a note on her clipboard and proceeds to clear off product Z and reinstate product X.

The store manager would quite like to ask her who agreed to install three six-foot cardboard cut-outs without consulting him, but she has three more shops to visit in the area before she picks up the kids from school at 3.30, so she hasn?t the time.

Some computer retailers won?t even let merchandisers in the store, or make them very unwelcome when they do let them in. ?I don?t need people telling me how to do my job,? said one independent proprietor. ?I?m in here six, often seven, days a week. I know what sells and what?s slow. And they bring in a huge cardboard display designed by some marketing floozy who?s never set foot in my shop, and then wonder why I take it down as soon they?ve gone.?

Hiring merchandisers is also seen among retailers as an excuse on the part of manufacturers not to get involved with the difficult business of maintaining a presence at retail. A manufacturer wants the mass-market exposure, but doesn?t have the funds to pay for an appropriately sized on-the-road sales team.

Part of the problem seems to be that manufacturers have expected the computer market to behave as if it were a mass-market before it is anywhere near ready to. Unlike the confectionery market, selling computer products requires more than just prominent positioning, bright packaging and dramatic POS materials that attract without informing. It needs a different skillset to conventional mass merchandising. Even relatively simple software packages and accessories are still a much more complicated sell than a Mars bar or a light bulb.

Manufacturers concentrate on selling to retail buyers ? on getting their products accepted. But they also need to inform sales people why the products are on the shelf, how they can be sold and how they complement other products that the store sells.

The merchandisers are only too well aware of their image and are determined to prove otherwise by offering services which are of benefit to manufacturer and retailer alike. The computer retail market is now several years old, and the services around it are beginning to ?show signs of maturity? ? by which computer industry people mean ?do what they are supposed to do?.

Merchandising organisations dedicated to high-tech products have sprung up, and those firms which come from the traditional end of the business have had to adapt quickly, not just in the services they offer but also in the staff they employ. The middle-aged woman with a clipboard and duster is making fewer appearances in computer shops.

?Our employee profile has changed from the middle-aged part-timers to graduates,? says Gary MacManus, Aspen Field Marketing business development director. Aspen comes from a background of consumer clients such as Nestle to service computer companies such as Compaq, Oki, Broderbund and Electronic Arts.

?There?s no way trade merchandising companies can re-train people who do mass merchandising in Sainsbury to be able to go into PC World and tell them how they should be selling Microsoft Office 97,? says Richard Thompson, chairman of Europa Marketing Services (EMS), for which trade merchandising accounts for only five per cent of turnover.

?We don?t have staff with feather dusters ? all our people are IT trained by the vendors,? says John Parker, joint partner of Profile.

But then Profile is one of those new firms which was formed to fit a specific niche in the computer retail sector that mass merchandising and mass distribution couldn?t squeeze into and is not really typical of merchandisers.

Profile concentrates on independent computer retailers ? a customer database of nearly 500 outlets nationwide. Each outlet gets a visit from Profile on average every two or three weeks. A prime site on the Tottenham Court Road may get weekly attention, whereas for a shop in Scotland it may be monthly. Its clients include blue-chip names such as Intel and Dorling Kindersley, and companies with ?difficult? products ? such as Quarterdeck, Hayes, SPC and Micrografx ? that don?t just fall on to the shelves and into the punters? shopping baskets, but need selling to the store manager.

?There are hundreds of dealers out there that we don?t get to see,? says Michael Thomas, channel sales manager at Quarterdeck. ?Profile gives us the chance to pitch. How else would we get our message across? We?ve tried all sorts of incentives at distribution but they haven?t worked.?

And unlike conventional merchandisers, Profile?s teams drive vans with client stock on board, so if the retailer requires one or two of something to tide him over until the next volume drop from distribution, it can be supplied from the van.

Thus Parker calls Profile a time-share pioneer sales service team. ?If a vendor is launching a new product, the sales message needs explaining to the retailer. All our clients are on long-term contracts because, generally, their products require focus.?

This concept of the merchandiser as an extension of the vendor?s salesforce takes on a different flavour, depending on the type of product the vendor has to sell. In the games software market, which is about as close to consumer retail as the computer industry gets, the main task, once the buyer has been persuaded to take the risk, is to attract the attention of the punter.

?When the consumer is confused by a wide range of similar products, it is up to the merchandiser to make the difference, to make the sale,? says Phil Cottier, MD of Interactive Marketing, which represents Eidos, Psygnosis, Sierra, Maxis, 7th Level and BMG.

Successful merchandising makes all the difference, says Cottier, especially when a game is competing for customers? attention in a crowded genre, such as football sims.

Cottier knows all about crowded genres ? his firm also does the merchandising for magazine publishers IPC and VNU, which compete in the crowded consumer and computer magazine sectors.

Eidos employs Interactive Marketing ?because it makes the link between sales and retail that much closer?, says Paul Fox, Eidos PR manager. ?We don?t want to be associated with people who are really pushy and make a nuisance of themselves. We want them to be professional and build a relationship with the retailers that is beneficial to all of us.?

At the other end of the spectrum, dealing with business software packages and utilities, much of the merchandisers? time is spent training the retail sales staff, so that they can sell intelligently to customers.

Merchandising is one of the services Retail Profiling Consultants offers clients, such as antivirus publisher McAfee, that want to know more about what is happening at retail. ?I hesitate to say antivirus software is boring, but let?s say it?s not uppermost in the minds of store staff,? says Mike Evans, a consultant at Retail Profiling.

?It?s our task to elevate it in their minds so they can talk about it intelligently. Product knowledge varies from store to store. A vendor can?t be certain that just because a buyer has been convinced, their product will sell.?

The fact is merchandisers don?t go into stores to sell anymore. ?We?ve risen above the mire of having to ask for an order, that?s the manufacturer?s job, says Thompson. ?We?re there to train, which is why we employ lots of technicians.?

At this end of the computer market, that is what most merchandisers are doing, which is why they consider merchandising to be an inaccurate description of their function. Vendors can?t afford to have sales people on the payroll to service every retail outlet they would like to be in, especially when the business is so seasonal, so merchandisers provide the outsourced sales team for them.

?There?s no way a computer company can employ all the staff required on a seasonal basis,? says Thompson.

Thompson?s boast is that EMS can visit 1,000 stores nationwide in 12 hours to launch a product ? an impossibility for a vendor. One project he has in mind is in-store demonstrators for supermarket cafeterias. What better place to hit the relaxing punters with a demo of the Wallace and Gromit screen saver?

?Retailers don?t understand who we are or what our products do,? says Thomas. ?But we train the Profile people on the key selling points of the products and agree which products are right for each dealer they see. Then Profile?s team can talk to the retailers about new versions and new products and train them how to sell the stuff.?

But there are far more computer companies represented at retail than there are merchandiser firms, so how do merchandisers cope with representing competing clients?

Interactive Marketing, which represents several companies that compete head-on, has dedicated teams for each client. ?I don?t think it?s widely known at retail that these aren?t Eidos people, because in a way they are,? says Fox. ?We?d like to send members of staff to each shop, but we couldn?t afford the payroll overhead. Interactive?s dedicated team is a good compromise.?

Aspen?s Compaq team wear Compaq badges and drive cars with Compaq colours. To retail they are Compaq. Similarly, translation software publisher Globalink likes to think that the Sales Unlimited staff who represent the company in-store are regarded by retail as employees of Globalink.

Some vendors insist on this level of transparency and get upset if they think anyone is going to tell retailers that their merchandising teams are actually outsourced. They pay merchandisers or field marketing teams to represent them at retail and they don?t want retail finding out it isn?t really them.

?The retailers are mature enough to know that a vendor can?t afford dedicated sales staff,? says Evans. In fact, because they know who you work for, and because you are independent, they know they?ll get a straight answer when they have a moan. They know you?ll give the vendor honest feedback because that?s what you?re there to do, not just to please some regional sales manager.?

The degree to which merchandisers are transparent or opaque can be argued over, but what everyone agrees on is that a merchandiser can?t go into a store and successfully represent two competing companies.

?If you?re representing five vendors on each visit, you can?t go into depth and do each product justice in a single visit,? says Evans.

A merchandiser?s role is not just one-way ? transmitting the vendor?s product sales training to retailers. They are also there to provide a feedback network, from simply ensuring that distribution is working and products are in place, to gathering information about why certain products aren?t selling.

To this end, merchandisers have different ways of feeding back this information to their clients. Many of Aspen?s field marketers are armed with notebooks or handheld computers, or can send back information via tone-dial phones. This means clients can interrogate data gathered from stores in real time and splice it and dice it whichever way they choose. Others agree beforehand what figures the client wants to see, and how they want them presented, and produce reports on a weekly or monthly basis.

Anecdotal evidence from merchandisers on the success or failure of a specific campaign or product is also used. ?Accurate feedback is not just something to wave in front of the MD and show what a good boy you?ve been,? says Cottier. ?It?s information which can be used to guide the business, for planning distribution and CD pressing.?

But as Cottier says, the only way to see what is really happening is to go into the shop. So merchandisers and manufacturers often make joint visits to retailers. Of about 14 clients, Parker expects two to be out with Profile?s teams each month. Globalink?s product marketing manager spent most of 1996 touring UK outlets explaining what language translation software could do. Larry Smith, head of IBM?s consumer division, spends a day each month serving in Comet branches.

Merchandisers can tell a vendor if distribution is working at retail, but how does a vendor measure merchandiser performance? ?We won?t take a client on unless there?s some measure to analyse,? says Thompson. ?That way the client can see what difference we?ve made over a period of six months.?

EMS places clients and their products on a graph line which runs from ?aware? to ?buy? ? in the middle is ?consider?. A company such as IBM, for example would score high on the ?aware? scale at retail, but is low on the ?buy? because it is considered a vendor which sells to big businesses only. EMS? job is to push IBM up past ?consider? and into ?buy? territory.

The emergence of retail in the computer market was supposed to be the death of small dealers, but EMS has found that the conventional PC dealer market is 40 per cent of its business and growing strongly.

?Computer firms are waking up to how much SME business they are missing out on,? says Thompson. ?The challenge for manufacturers is to reach small businesses through dealers and they need to treat the dealer base with the same effort that they put into multiple retailers. The biggest opportunity is for manufacturers to recruit dealers who have never sold the manufacturer?s brand.?

Computer companies know they need independent dealers and retailers to sell to small businesses and private individuals, but can?t afford the sales staff to see all the dealers they?d like to recruit.

If merchandisers can bury the image of the middle-aged woman with the duster ? and they are making every effort to do so ? they have a bright future.