Phase I: Presenting
products on paper
The product plan, which must be presented at an initial meeting with a prospective
distributor, should address products in development for the current year, as
well as subsequent titles that will follow as part of a series or as sequels
to the new products ready for this year's holiday release. In addition, the
product plan should include the positioning of each title and its target market,
the list price, and the packaging of the product at the conceptual level. (Packaging
should remain conceptual until a distributor accepts the product and offers
input, since he has the power to reject the product if he believes the packaging
will hinder its ability to sell.) Although product plans may be treatments or
storyboards, they should exhibit the publisher's vision and strategy over the
next two to three years.
Phase II: Title development
Once publishers have gathered input from potential distributors on product planning
and packaging, they need to get down to actual development. Traditionally, this
work takes place during the spring. The goal is to have the product at least
90 percent complete in time for summer CES, held in Chicago in June, so that
it can be demonstrated to potential distribution partners.
More than half of the new media titles sold during a year move through retail channels during the holiday season and the first 60 days of the new year. At the same time that publishers are working on actual production, they should be gathering "boilerplate," or generic, contracts from distributors they have chosen to review. Strengths and weaknesses of any potential distributor should be researched: Get in-depth information concerning their contracts, negotiation style, courtship behavior, sales and merchandising performance in the field, and field support such as sales reporting and inventory tracking. (This can be accomplished by talking with publishers who have already aligned themselves with these distributors.) This basic research should bring a publisher's short list of partners down to about three distributors.
Phase III: Finalizing the deal
Typically, contract negotiations begin in earnest in June after final (or close-to-final)
products have been presented to prospective distributors. Two or three such
meetings should bring one distribution partner to the forefront as a preferred
partner. It is also important to get concrete suggestions on packaging from
the distributor of choice in June. In addition, you need to get on your replicator's
schedule for mastering and replicating the discs as well as on your designer's
schedule for preparing the inserts and packaging. As we discussed, it is helpful
to get a final approval from the distributor before committing funds to final
package design. This needs to be done in June or early July, to be ready for
a replication and production schedule in August. Remember that replicators are
booked year round in advance, and that designers are busy in the early fall.
The art of shipping and selling.
Products must be shipped in mid-September in order to arrive on retailers shelves
in early October. (If the publisher is also distributing finished goods through
rackjobbers such as Handelman's to mass merchants such as Target or Walmart,
the finished and packaged product must be shipped to the rackjobbers one month
earlier to allow for racking and distribution to retail.) The September shipping
date is critical. Take, for example, one publisher who missed his September
date. He pulled extensive strings to have his product shipped from the distributor's
warehouse into retail by early November in order to catch the selling season.
But early November is often too late, and in this case, the product sat in the
retailer's backroom until January. Although the publisher had convinced the
distributor to move it into retail during the busiest season, he had no means
of convincing the retailer to move it from the backroom to the shelves during
its busiest season.
The power of marketing.
This scenario points to the usefulness of "feet on the street" or reps committed
to handling and merchandising a product at the retail level. To date, field
support of this sort is rare among new media publishers. In addition to marketing
representatives promoting wares on the street, publishers must also focus on
marketing to the channel and to the customer since product awareness is crucial
to its success. "Push" marketing, a sales technique devised to get products
into the retailers' hands, should begin in August. "Pull" marketing, which could
include print advertising, direct mail or store promotional mailings, is designed
to pull people into retail stores. Pull marketing should be planned in early
September, be implemented in October -- to promote holiday sales -- and
continue through February when the holiday buying season begins to slow down,
at which point you should already be one month into your 1995 product development
cycle!
Joey
Tamer refines the vision, strategy and success of companies --
Fortune 1000, capitalized start-ups and investment fund.
www.joeytamer.com
(310) 245 5310 joey @ joeytamer.com