Premium Brands on the Internet


The ROI Hunters came across another hunting parting recently. We spent some time with them reviewing their equipment and tactics, and we learned something very interesting in our chat. Some companies don’t think the internet will help them in their hunt for ROI. Especially with premium or superpremium brands. So we spent some time explaining where their thinking might be wrong, after all, hunting ROI is not for the mis-informed.

Some background first, this company has both premium and superpremium brands. For the sake of this article, premium brands are those that cost consumers 75 to 100 percent more then the category average. Superpremium brands are those that cost consumers 150 to 200 percent more then the category average.

This group was allowed to start and provide their case for not being on the internet, and their argument was simple. The internet is primarily used for selling low cost items. Items which can be sold on-line and small enough to ship with the popular shipping services. Competition on the internet will continue to force companies to drive down their prices. By creating a web presence for their premium brands, they would need to lower prices to compete with other category competitors to gain any serious market share.

Ok, so now we had a turn to speak. I first started by saying, “No actually you will want to raise your prices on the web site“. The silence was deafening as they tried to grasp what I had just told them. Now to make the remainder of this long 3 hour meeting (which was only to have been a 30 minute lunch) fit in this article, I’m going to share with some of the points we used in our case:

  • Don’t compete with your channel partnersRAISE THE WEB PRICE – build a web site in which they know they will never be under sold (Remember you can always add a FREE accessory or service plan to justify the price and still make large profits because of high margins on these brands)
  • Teach your channel partners what is on the site– what a great way to keep in touch with your partners by creating a reason to start up a conversation with them about what’s changed
  • Help your channel partners – create a site they would want to use in the sales process and make them look good in the process by allowing them to sell at a much lower price then your inflated web price.
  • Focus on the UP-SELL – make sure the site builds the case for your product against the lower priced category products or the reasons to move to your superpremium brand.
  • Create and build evangelists – people that would love to send their friends to the site so they can find out more about the purchased product
  • Syndicate updates to your partners – using RSS you can keep their product information and product testimonials up-to-date, while controlling the content and message.

I will keep you informed about the hunt, if we get the chance to help this company.

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