Graybar, Sonepar … Creating / Fulfilling Demand

Over the past couple of months we’ve been talking about growth, be it from demand creation or demand fulfillment.  We’ve written an article on it for Industrial Supply, one for the Canadian Electrical Wholesaler and a couple here on ElectricalTrends (“Demand Creator or Demand Fulfillment Agent” and “Handing Over Demand Creation“).

We’ve stated that demand creation can be hard as it requires understanding your customer so that you can bring them “new” opportunities.  It can also mean identifying new opportunities.  Demand fulfillment relates to capturing an increased share of a customer’s spend.

So, we thought we’d share some examples from Graybar and Sonepar.

Demand Creation

Graybar ran this ad in NEMA’s electroindustry magazine.  Why run an ad in an electrical manufacturer association magazine? Given the message about energy efficiency, Graybar is targeting this audience as potential customers. And this is an audience that 1) knows who Graybar is, 2) is, in many instances, selling to Graybar, 3) understands the benefits of energy efficiency and 4) is in the same space.  Good idea to advertise to an end-user audience that could have funds already allocated to these types of projects (or who could based upon an ROI analysis).

Demand Fulfillment

And then we have some examples of demand fulfillment, first from Graybar and then from Sonepar … three different approaches.

1. Allen was recently speaking with a number of contractors for a client project. Afterwards, he listened to a gathering of 4 small to medium sized electrical contractors who were recently pitched Graybar’s G-Bid estimating system.  The contractors were impressed with the functionality and commented on how it could let them be more productive (or effective) and profitable (accurate). According to these contractors, and how Allen heard it from them, it seemed that the way it was offered, that if the contractor signed up (3 did) that the estimating system will be free from Graybar and that it will be fully loaded with Graybar data and Graybar’s “best prices for that contractor”. It appears to be a free tool. They were told that they would be automatically updated by Net Pricer (this term was used by Graybar) when they logged on. Further, if the contractor achieved certain purchasing objectives, in about six months they would receive another free piece of software relating to change orders. Upon questioning from Allen, the contractors realized, and understand, that they would use the system more and possibly become more dependent upon the system (and hence Graybar).  They were told about an 800 support number if they had any problems.

And here’s more information on G-Bid, courtesy of a YouTube video.

From a “sales and marketing” perspective, this could be a very effective demand fulfillment strategy enabling Graybar to take share within a contractor by being viewed as a valued supplier who is helping them be more efficient / productive and profitable.  Get the customer “hooked” on G-Bid.

As an Independent distributor how do you get them off the G-Bar system and better yet, if the contractor discovers they can compare prices and take other price files into the system, how do you keep from being cherry picked???

2. Another Graybar example is this ad in Electrical Contractor magazine’s March 18th e-newsletter. The ad focuses on Square D switchboards. Another instance of promoting ones brand and targeting a broader audience than your existing customer base.

As an aside, for those distributors who would like to emulate this concept, EC&M now offers a regional marketing offering for distributors and there are other firms that can do similar but online, targeted to selected geographic areas as well as can be tailored by customer types.  If you are interested in either, let me know and I can put you in touch with the appropriate people.

3. Sonepar has taken a different approach at the enterprise level (and presumably has a number of operating company initiatives).

At the corporate level they have been in the acquisition mode, recently purchasing QED in Denver and Electrical Distributors in Texas (plus 4 other deals throughout the world).

And, at the same time, they have hired someone to more fully develop their national account solution, which is another way of capturing market share at industrial facilities (if that is their focus), or to sell more electrical to their IDG accounts (if it is their focus), or to gain greater share at other commercial entities (which have lots of lamp business).

Two companies, different approaches to demand creation and demand fulfillment.  What are you doing to drive your top line sales, profitably?