Selling Direct to Consumers is “Catching” On

By on March 25, 2011 in Marketing

A group of fishermen in Halifax are reaping the benefits of selling their catch direct to the consumer through a unique marketing approach that eliminates the middleman and quadruples the price/lb. they get for their fish. These better prices enables them to continue to fish in a traditional way that benefits not only their customers, who love the quality of their fresh fish, but also the ocean habitat. Strategic disintermediation is a marketing strategy that can help manufacturers compete.

A year ago I wrote a blog entry called Lobster and “The Net”,  about a highly successful direct to consumer online lobster website calledwww.catchapieceofmaine.com.  It was a great example of what I call Strategic Disintermediation, i.e. peeling off multiple levels of distribution that traditionally handle your products on the way to the consumer,  in order to improve margins and make local manufacturing or in this case fishing viable.  This “going direct” disintermediation can be achieved through out-of-the-box, blue-sky thinking about how technology and market trends can be used to radically change the way manufacturers sell their product.  In this case, it was using online selling coupled with a unique packaging and shipping technique.

Another example from the fishing industry, who face the same global pressures as all manufacturers, recently popped up in MacLeans magazine.  A group of 5 fishermen in Halifax started a cooperative organization called Off The Hook to sell fresh fish direct to the consumer.  Using a Community Supported Marketing Model(CSA) consumers buy a $60.00 share of the weekly catch for the whole season.

Listen to how the article describes these fishers new marketing approach:

 

              “Ever since colonial times, the Maritime fishing industry has fed the long-distance market through the middleman, who buys the entire catch.  By selling directly to the consumer these fishers are reinventing the supply chain.  This means they can earn more.  Where the price paid for haddock by the middleman is 80 cents to a dollar, the fishers sell to the cooperative for $3.00 a pound.  “We are trying to keep a fishery going so the next generation can have it,” says Off The Hook’s Orlie Dixon.”

This direct to consumer approach not only provides a dramatically better price(4x’s better) to the fishers but enables them to demonstrate to consumers the advantages of buying fresh, odour free fish that is only 24 hours old and caught in small batches using traditional fishing techniques that don’t destroy the oceans fish habitat.  Besides better quality and taste, customers appreciate knowing where how their fish were caught.  Its part of the value added proposition that justifies the slightly higher prices they pay.  Its obvious that these fishers have recognized and are taking advantage of the “Buy Local, Buy Authetic” trend that many consumers are moving towards.  Can you take advantage of new opportunities in your industry by changing or adding to your marketing channels in creative ways that recognize the convergence of technology and consumer trends?  It just might lead to a more profitable business.  If I might coin a new phrase.  DON’T WAIT, DISINTERMEDIATE!

About Steven Singer

After receiving a B.A. in Economics from University of Toronto and an Ivey M.B.A. from the University of Western Ontario, I worked for the IMEDE School of Management in Switzerland developing case studies in manufacturing management. Returning to Canada, I joined Ontario Die Company of Kitchener, eventually becoming V.P. of Sales and Marketing, responsible for expanding the sales of its specialty diecut tooling produced in its 2 Canadian and 4 U.S. factories. With technically superior products, a strong North American salesforce, and strategically located plants, we were able to successfully penetrate the U.S. and Mexican markets in a variety of end use categories including automotive trim, footwear, and packaging. After 14 years with Ontario Die I became a marketing consultant and taught a course at Wilfred Laurier on Starting Your Own Business. In 1988, I started a Sales Company, Singer Cutting Machinery Sales Ltd., representing equipment manufacturers from Canada, U.S. and Italy that supplied machinery to the same end use markets I was servicing previously for Ontario Die Company. For the next 20 years, I marketed and sold equipment solutions throughout North America and Mexico, emphasizing advanced quality products, a value added sales strategy, geographical diversification throughout North America and Mexico, close customer relationships, and continual product innovation. These past 35 years of face to face contact with hundreds of North American factories and their management, has provided me a real life storehouse of manufacturing strategies and experiences that helped me formulate some of the ideas that I will be sharing in my blog. This experience also gave me an acute appreciation for the tremendous value that the manufacturing sector creates not only for its employees, customers, and suppliers but the wider community. It is my view that a society in the long term will only be as healthy as its manufacturing sector, notwithstanding economic pundits who believe that our evolution to a service economy is both inevitable and to be desired. Hopefully, my blog, which will center on creative marketing strategies that both small and large manufacturers can use to not only survive but prosper, will help in a small way to turn around the declines we have seen in our manufacturing sector over the past decade. Finally, I have lived in Waterloo since 1973, have a wife and 3 grown children(one of whom is a jewelry manufacturer I am proud to say), continue to do volunteer work coaching Special Olympic Basketball and helping our Neighbourhood Association, and have an interest in alternative energy technologies. I look forward in getting to know you through my blog.
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