Develop the Right Channel Relationships
The Challenge: A major supplier to the automotive market provides original parts and accessories for automakers as well as repair and replacement parts for aftermarket firms. This corporation wanted to grow its already significant presence in the aftermarket by entering a specialized segment. The firm wanted to understand if this specialized segment could yield them sustained growth and attractive margins.
Assessment: Blue Canyon completed a detailed assessment of this specialty products market. We found this market to be extraordinarily complex, with numerous channel organizations, including various categories of distributors and installers, and numerous end customer segments. Within this labyrinth, however, several end customer sub-segments emerged which indicated a strong match with the supplier’s technology base and product portfolio. To effectively reach these end customer sub-segments, our assessment indicated that specific channel organizations met the key criteria for candidates for inclusion on supplier-channel winning teams.
Strategic Solution: One targeted market segment involved complex products that required extensive installation and service. To reach this segment, our client established exclusive relationships with specific national dealers. Agreements were reached defining roles and responsibilities, with terms that provided attractive economic returns to each participant. These organizations then collaborated on new marketing campaigns designed to gain share with targeted customers. Another targeted segment required less product complexity, but demanded instead reliable product availability. To reach these customers, the supplier expanded product authorizations for certain existing channel partners, and appropriate steps were taken to ensure that these distributor and dealer relationships effectively covered this new line of products.
Results: Our client has gained substantial market share in each of the targeted markets in just a three year period, and is now examining strategies to extend this business into the emerging vehicle aftermarket in China.