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  • #969882
    Beth
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    I have a product which I have just started taking around to retailers in the hope they will stock my item. I’ve only been to a few shops, but the response has been good and all have purchased a starter kit. HAPPY! But one question I got really took me off guard. A retailer asked if they could add their logo or business name to the back of my product (which happens to be a bookmark if that makes it easier to discuss). Caught off guard I said it would be ok, but giving it more thought, I feel it’s probably a bad idea. My thought is that if I’m trying to raise awareness of my branding, surely their branding will be a major distraction from this. Any opinions/advise on how to handle this would be great!

    Also another retailer that I’m meeting with eluded that she has enough product in her shop, but might get me to tailor something to her business. I’m thinking this is probably ok, as I can design it completely different to my collection. But in terms of pricing, would I make the items the same price as mine, cheaper, or more expensive. Am I in effect competing with myself?

    I’m obviously keen to keep good contacts and even gain unexpected work, but am not sure if I’m putting myself in bad situation.

    Hope you can offer some advise!

    thanks:)

    #1041362
    DavidM
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    Hi Beth,

    Sounds like the retailer is trying to co-brand with your product. This could include either:

    • including their logo on the packaging, product or both
    • a permanent or temporary (e.g sticker) association on your product

    Without knowing your product, or why the retailer suggested the co-branding arrangement, I don’t see a lot of upside for you in this strategy. You rightly pointed out that you want your customer to associate the product with your brand – not the distribution channel brand. Sure, it helps if they know that they can buy your product from a certain distributor, but that’s not a key driver.

    A co-branding arrangement could work through exclusive distribution rights, but given you’re probably in the early stages and looking to grow, this could be prohibitive. You’ll need to assess.

    It’s good to also plan for relationship breakdowns. What happens if you and your supplier have a disagreement and no longer wish to use them? Your product is still co-branded.

    In terms of tailored products, you need to assess the opportunity. What’s your return on investment (at different price points) for your tailored effort, vs economies of scale with your regular product. There may be an opportunity, but it may not be viable.

    Good luck,

    #1041363
    Beth
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    Hi David

    Thank you so much for your informative reply! My product is a very inexpensive item- a bookmark! The retailer is a bookshop, so her idea was to put her branding on the back of my bookmark (which is full colour both sides, but has a small space where she could “queeze” it in). But like you say, I can’t really see an upside, other than making her happy! For me it seems that she’ll have her bookshop name circulating in books on the back of my artwork – seems more damaging than useful from my perspective. Thank you – I think you’ve helped re-inforce my thoughts!

    Most appreciated,
    Beth

    #1041364
    DavidM
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    Hi Beth,

    Glad to hear you found my advice useful.

    You could also opt to co-brand to reduce your production costs. By having the bookstore contribute to the printing (in return for logo and a spiel) your print costs could be reduced.

    David

    #1041365
    marketingweb
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    Hi Beth,

    I come from the promotional products industry where EVERYTHING is about putting a customer’s brand on things, so my instant reaction is that what she has asked for is quite normal.

    In fact, when I first started in the industry about 6 years ago most major brand names were extremely restrictive and down right frowned upon or worse having a second logo put on their product.

    Now, a lot of big well known brands are discovering the value both in co-branding as a formal process, and in relaxing or removing the restrictions on adding brands to existing product – for example it’s no easily possible to get brands like Jamie Oliver, S&P (Salt & Pepper), Morrissey, Coleman, Esky, Leatherman, Wenger & Victorionox Swiss army knives, Mag Lights, Schaeffer, Parker, Waterman pens and many many more, that are not only allowing secondary brands to be added, but in many cases encouraging this and even offering the service themselves as a way to build market share in the corporate market. Co branding is alive and well and often a solid business strategy, and you are being offered an opportunity to learn from the clever marketing stuff big brands do, but on a smaller scale.

    Now these are higher end products in a lot of cases, but I think the principle applies to your product as well for some of the same reasons and some additional ones. If it was me, i’d be excited by all the extra business opportunities opening up, and i’d like to convince you why you should be too!

    My first question would be what are you specifically worried about by this idea of co-branding? Ignoring the “it just doesn’t seem right” idea, some I can think of are as follows, with my thoughts on an answer – you may have a different answer.

    Q) Will it will devalue or damage my brand?
    A) I doubt it for two reasons.
    a) It’s unlikely that a bookmark is a product people buy based on brand recognition anyway (rather because they like the design or they need a bookmark – impulse purchase). As such your designs have value, your brand potentially less so.
    b) If the extra branding is subtle on the back, this won’t detract from the design so won’t destroy any value.

    Q) Will allowing the co-branding decrease sales by devaluing or damaging the product?
    A) Again, I doubt it – customers won’t be more or less likely to buy the product on face value. However, this particular retailer is more likely to push the product harder and/or even give it away if it has her brand on it as well.

    Q) Is there any benefit beyond making my customer happy?
    A) Other than the possibly increased sales/usage from her, probably not. But keeping your customer happy is the name of the game. She is under no compulsion to stock your product, so if you keep her happy she will stock and promote it, if you don’t keep her happy she won’t. Simple as that.

    Q) Are there any disadvantages of someone else’s name circulating on the back of my artwork?
    A) Only if it no longer had your brand/name on it. If it has both, then not. This seems to be your major concern, i’d be interested exactly how you believe this is damaging. Your instant reaction is this, but really think specific – what is it going to damage? Your brand recognition? The look of the product? Your sales or repeat sales?

    Q) Are there any stock risks (as mentioned by DavidM) of going down this path?
    A) Yes, but only if you hold stock at your expense/your ownership. This is a big risk, as if they don’t sell etc you are stuck. The solution is simple – only offer “custom work” that is dual branded or can’t otherwise be resold on the basic that you produce and order, they pay for the order and hold stock themselves, then reorder when they run out etc. Don’t fall into the trap when you are starting out of holding custom branded stock.

    Q) Exclusive product for another retailer – is this a good or bad idea?
    A) I think it’s a good idea, but only if you either treat it as a custom job (they have to buy the full job batch), OR there is an agreement that it’s only exclusive provided they move X units per Y time (provided there is nothing custom, just exclusive). Big brands produce exclusive ranges for specific retail chains all the time . For example a surprising link up between fashion designer Peter Morrissey and Big W or a similar larger program at Target where designers like Nepoleon Perdis normally out of the league of most offer exclusive ranges at Target. Even at low level product, if you walk into any Woolworths store you will see larger packs of Weatbix with an extra 200gm “Exclusive to Woolworths” all the time. Giving exclusivity of a range or product encourages the retailer to push the product harder. Of course if it’s one shop you have to make sure it stacks up financially.

    Q) Is my product so unique, valuable and “must have” that I can turn down business opportunities for the sake of “protecting my brand”.
    A) Your artwork is unique, your concept/product is not. I bet i could probably produce and print bookmarks and sell to the customer much cheaper than you are if the quantities of each order were large enough (I’m not being arrogant here, being in printing it’s probably a fact). What they don’t have is your designs, but much more importantly what I don’t have a passion for the product, a range I can show, time to visit the stores, ability to sell in smaller volumes etc. If the customer asks you to doing custom bookmarks for you, it’s NOT because your product is so unique they can’t get it anywhere else. What they see is the value of all the above things, and the convenience of buying from someone who knows rather than having to hunt for someone.

    I think overall you are looking at yourself as an artist, which you are. But you are also a “manufacturer” of bookmarks (even though you obviously get them printed elsewhere). Providing the sums add up, just put your manufacturer hat on when talking about custom designs or co branding, and your artist hat on when talking passionately about the product.

    Re the charging of the same price, more or less than normal ones, don’t be governed by whether it’s custom or not (in the sense of whether it SHOULD cost less, more or the same). Think about it as a business transaction:
    1) Are your production costs for the custom ones more/less or the same per unit (will depend on how many they buy).
    2) If you are a getting a bigger order they pay all at once, how much value is the reduced holding and inventory costs?
    3) If it encourages more and ongoing sales, what is the value of this?

    Overall I would say if they cost less to produce based on a larger sale volume, charge less. If they cost more, charge more. If they cost the same – probably charge a little less due to lower holding costs. And remember, the best sell price is as much as you can get away with will still winning the sale and keeping your customer reasonably happy!

    Hope this long novel above is of help!

    Matt

    #1041366
    victorng
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    Holy cow, what a fantastic reply, Matt.

    I was going to post a reply but you put into words all of what I was thinking (and more) far better than I could have.

    That’s why I leave it to the experts :)

    Cheers
    Victor

    #1041367
    Anonymous
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    Hi Matt,

    What Victor said!

    Love your work!
    Jayne

    #1041368
    DavidM
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    Great advice for Beth, Matt. Thanks for taking the time to post.

    #1041369
    Beth
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    Hi Matt

    WOW WOW WOW!!! I can’t thank you enough for such a brilliant, generous reply to my question – I’m blown away. Such fantastic points that you’ve brought up, and yes, you’re reading my mind very well! I am in early stages of selling my art in galleries (yes, the “thinking like an artist” statement!). It’s slow progress with sales, so I put a lot of thought into other ways to use and sell my art. Long story, but for many reasons, I decided on printing bookmarks. I deliberately wanted to enter the “impulse buy” market, which is so different to the gallery world. But you’re so right that I was focusing my thoughts like an artist when considering my branding. I’m so used to being told “get your name out there!!” Hence why I thought other logos would be a distraction. But given your perspective on this, it’s totally turned me around. It’s made me see all the great benefits and feel comfortable, even excited and happy, about the suggestion! Goodbye doubt, hello opportunities:)

    A BIG BIG THANK YOU. The advice is so insightful, yet practical and to the point. I will be keeping this page bookmarked as my very first marketing lesson!

    cheers
    Beth

    #1041370
    marketingweb
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    Beth, post: 50176 wrote:
    Hi Matt

    WOW WOW WOW!!! I can’t thank you enough for such a brilliant, generous reply to my question – I’m blown away.

    WOW, thanks for the feedback Beth, much appreciated and I’m glad it was a help to you. I’m known to be quite wordy, but I actually outdid myself with that post so I was hoping it wasn’t a waste!

    If you need any general advice or professional marketing assistance please don’t hesitate to contact me.

    Matt

    #1041371
    Past-Member
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    Matt – thank you for sharing for Beth. I really learned from what you said also.

    I think overall you are looking at yourself as an artist, which you are. But you are also a “manufacturer” of bookmarks (even though you obviously get them printed elsewhere). Providing the sums add up, just put your manufacturer hat on when talking about custom designs or co branding, and your artist hat on when talking passionately about the product.

    As a designer & illustrator, also selling product, I am constantly changing hats in working hours, let alone my home life.

    Back in the long ago days when I first went into business, the government called me a ‘manufacturer of artwork’ which meant I was sales tax exempt at the time. I won’t go into how complicated that all was then. I hate GST but it’s much easier than the sales tax issues.

    The hard thing for creatives is to be able to work out which hat they should be wearing for which client or contact, especially when we get so passionate about our creations.

    Thanks again.

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