Stanley Black & Decker (SBD) is one of the world’s top provider of tools and storage solutions, sold through iconic and trusted brands such as Stanley, Black & Decker, DeWalt, Sidchrome, Powers Fasteners and Irwin Tools. They are also the second biggest provider worldwide of security solutions and a global leader in engineered fastening.
The merger of Stanley and Black & Decker changed the way SBD went to market, with a sales strategy focused on key trade partners in their industry. This strategy impacted the large Independent Dealer network across Australia, who lost direct contact with SBD and as a result began to purchase from competitors who gave them sales support.
The network was stocking and selling less of the Stanley Black & Decker product range and competitor activity was also eroding sales. Although Stanley Black & Decker often delivered tactical campaigns that influenced salespeople’s recommendation behaviour when selling to the consumer, other vendors had attractive incentives targeted at dealers that drove product purchase.
To combat this, Stanley Black & Decker have previously tried to run their own rewards program but wanted a new direction and engagement strategy – reward all dealers (not just a few) and that would drive an increase in the share of wallet and acquire more sales. Independent Dealers are spoiled with brand choice, and the challenge was to increase engagement to develop stronger relationships and grow their revenue with this trade group by increasing sales.
To do this, Stanley Black & Decker had to shake things up and add value to the Independent Dealer Network in such a way that they would impress and reconnect with customers.
The Shed Rewards was created. This brand appealed to the predominantly male audience as it was designed to be reminiscent of a tool shed, where you can find any SBD product across the diverse product portfolio. It also encapsulated the feeling of a Shed full of rewards, where the dealers could go and find the reward they were really after for the effort made for achieving program criteria. Shed Rewards was designed to become a community where the Dealers could meet and find what they needed to get a job done!
The new Shed rewards program focused on 2 key areas:
The program criteria focused on encouraging Independent Dealers to stock and buy key products from all the product range. Participants earned points on all purchases of eligible brands and points could then be used in the rewards catalogue.
To encourage the increase of product sales, all dealers were set a program sales targets made up of sales across SBD key brands such as Dewalt, Sidchrome and Powers.
These were broken into quarterly periods to ensure the dealers didn’t lose sight of the target and help any change in seasonality they may have had. The standard offer of the program was earning a base rate of points on all sales made across the Stanley Black and Decker product range that could be redeemed instantly, giving the dealers instant gratification and reinforcing the behaviour of stocking and selling Stanley Black and Decker products.
This opening rate was a lower amount, with the real benefit coming from over achievement of the quarterly target which triggered an incremental rate of point earn.
The increased earn rate gave dealers the chance to earn double the value of points previously earnt and for SBD they were linked to overachievement and increase of sales across the brand portfolio.
Achievement of sales targets also fed into the second key area of the program – recognition for the Independent Dealers. By meeting program requirements such as sales and ranging, as well as trade terms, the dealers could become Premium Dealers which came with added benefits and SBD support. These included exclusive new product previews, deals, instore marketing support and signage and more direct sales support, which was a complaint the network had been missing.
In order to drive the incentive, Shed Rewards program communications included a launch brochure that directed participants to a fully branded sales website where participants could view their target information and track their progress to target, as well as redeem points earned for items in the reward catalogue.
Participants were kept engaged with the program primarily through monthly email communications which provided an update of their points balance and progress to targets. New product information and Stanley Black & Decker events were also communicated through the monthly emails.
At the end of the first year of Shed Rewards, the program had become the talk of the network and dealers reengaged to stock and sell Stanley Black & Decker.
Independent Dealers had a sense of being part of a select, hand-picked group of participants and achieved a staggering 26% sales growth over the previous year. The initial design the SBD ‘Shed Rewards’ targeted a 10:1 return on investment through sales growth.
However, with the increase of the share of wallet spend with SBD, the program delivered an amazing 40:1 return on investment. Returning SBD an additional $30 more benefit to every $1 dollar spent in the program. A result that delivered SBD more than expected.
Much of the return was attributed to Shed Rewards’ focus on incentivising sales volume across the entire product range and brands, as well as deepening engagement across all the network. In short, the design and execution of the Shed Rewards’ engagement strategy influenced dealer and salespeople behaviour significantly.
The overwhelming feedback from Shed Rewards’ participants was that not only had they been personally rewarded by Stanley Black & Decker more than any other manufacturer, they were extremely happy to be building stronger, mutually beneficial financial relationships with Stanley Black & Decker again.
Additionally, they were part of a network of Premium Dealers who felt they were doing the right thing by customers by recommending a quality product and getting rewarded for it, rather than recommending on price or even inferior product because of a back-end incentive.
An engaged and active dealer network achieved one of the key program objectives – to establish and encourage strong relationships with Independent Dealers.
Furthermore, by the end of one year the program increased almost 50% in registered participants and created a strong database for SBD sales representatives to contact.
The program achieved 26% increase in sales over the previous year, meeting the program objective to grow sales year on year.