VIP Pet: Go-To-Market Strategy

A U.S.-based retailer wanted to expand their pet food category by offering refrigerated pet food and they believed an Australian manufacturer had the solution they sought. Getting the product to shelf would not be easy. A highly complex supply chain process, limited shelf life, and government regulations were just a few of the challenges the retailer and supplier needed to overcome. They called on ArchPoint, with its integrated, cross-functional capabilities, to develop and execute the supplier-to-shelf strategy.

When introducing a new product line to market, ArchPoint uses a five-phase go-to market methodology: Assessment, Strategy, Solve, Launch and Learn and Adjust.

ArchPoint began by validating the opportunity for the retailer by studying the emerging refrigerated pet food category in the U.S. With only one competitor in the market, there was room for choices. ArchPoint demonstrated the category growth potential by comparing the market fundamental in the U.S. to those in Australia, where the category share was 7x larger. ArchPoint also established that the retailer could offer their shoppers the same quality product as the incumbent at 25% lower costs. In addition, the ArchPoint Marketing team studied how they could educate the consumer while the Supply Chain team assessed how to get the product to stores, and ArchPoint’s Sourcing team compiled all government requirements to sell imported product in the U.S. market

As imported refrigerated pet food was a rarity in the U.S., ArchPoint had to create the benchmark for supply chain, marketing and shelf strategies for it. The integrated strategy included the following elements:
• Supply Chain: ArchPoint utilized its freight forwarder’s expertise to determine the quickest route from production to shelf
• Forecasting: Influenced by a limited shelf life, ArchPoint created a lean inventory or just-in-time model based upon existing competitor inventory turns
• Government Compliance: ArchPoint researched all federal, state and local certifications required to sell imported packaged pet food
• Store Testing: As a refrigerator is required to stock the pet food, ArchPoint’s Market Execution Team worked with the retailer to test whether using valuable store real estate for the product had desirable return on investment.
• Marketing Plan: ArchPoint created a comprehensive marketing plan to support sales expansion and educate the American consumer about these novel products

Solving and Launching
ArchPoint aligned the retailer and suppler to the strategy and plan and began to execute:

  • Shipping Lane & Forecasting – The product shelf life was 120 days from the day of production. Subtracting 40 days for transit and 14 days for warehouse to store transit, a 66 day maximum shelf was possible. Given the limited inventory turns in the beginning of the program and short shelf life, ArchPoint shipped one 20 ft. container every month to start the program. ArchPoint also created a shipping lane that bypassed domestic warehousing and shipped directly from manufacturer to customer distribution center.
  • Government Compliance – ArchPoint compiled all government certifications from both the local and national federal pet food compliance authorities and worked with the supplier to place in each packaging list for U.S. customs
  • Store Roll Out – ArchPoint’s Market Execution team shipped the refrigerators, reset planograms, installed the refrigerators and stocked all product in nine test stores
  • Marketing Campaign – ArchPoint’s marketing team drafted and designed attractive brochures and manufacture’s coupons to place on each in-store refrigerator. In addition, ArchPoint had a marketing or sales representative at several major pet events in the test store regions

  • Learn and Adjust
    From consumer product usage to brand preference, ArchPoint critiqued the original go to market strategy after the initial shipments and took actions based on the learnings:
  • Sales and Forecasting: ArchPoint improved forecasting and better targeted promotions for specific products by monitoring SKU velocity
  • Sourcing: ArchPoint learned quickly that consumers had issues storing pet food after one time use. This prompted ArchPoint to create a pet food storage container that was placed on each in-store refrigerator
  • Marketing: By analyzing sales data, ArchPoint’s marketing team concentrated on the top selling brands to increase awareness through manufacture coupons and other promotional vehicles.

  • Results
    One year after launch, ArchPoint’s client added 30+ additional refrigerators in their region. As shopper began to value the supplier’s refrigerated brand, the retailer was comfortable adding ten additional SKU’s into the dry pet food section. ArchPoint continues to manage the customized shipping lane to ship all product to the customer in a smooth and consistent manner with virtually no out of stocks. With a success story under their belt at one retailer, the manufacturer is planning to expand throughout the U.S. market under the same strategic model created by ArchPoint.