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Shure strength: Distribution 2.0

The microphone giant has been gradually shifting its methods over the last 18 months. Dave Robinson was invited to learn about Distribution 2.0 and more

This is unusual.

PSNEurope has been invited to Germany, to view the sharp architectural lines of the Shure HQ, and hark to the even sharper designs of its EMEA business strategy. Some 90 minutes later, your correspondent will emerge from the board room, the sole recipient of a thorough barrage of facts and figures and fun: a 100-slide PowerPoint presentation; the collective input of six, maybe seven senior members of staff; the inevitable joshing regarding the ubiquitous SM58, and just how many units the company has sold.

This, then, is not a product preview. Not a technical overview. Not the heads-up on the next InfoComm/PLASA/AES.

But that’s OK. Because, when you strip away the corporate styling and the other bunting, what Shure have done here is very smart. The company had to look at where it was in the market, and it has a plan to capitalise on it.

First of all, says marketing director Nils Proesser, Shure had to recognise how the marketplace has arrived at an almost “perfect market”. This is a combination of factors: the rise of e-commerce and social media; the blurring of trade borders in Europe; a consolidation of retailers and dealers; and a change in buying habits.

“The end-user depends on the same degree of service, same communication, same look and feel of the company, independent from the channel. That is a big challenge for us and our trade partners,” says Proesser.

So how has Shure, acknowledging these factors and a desire to embrace them, reacted?

With, put simply, a five-point strategy, and a five-year roadmap.

Firstly, products. The pro-audio market has seen Axient, ULX-D, DIS conferencing systems and more begin the shift. In the retail world, the PG, SM and Beta wireless lines slide into the frame. Establish the right product portfolio – of course.

Second: infrastructure. While Shure Distribution UK (SDUK) found a spacious new HQ in Waltham Abbey in 2007, it was paramount that the German HQ found a suitable new hub. Hence, the Eppingen facility, with its minimalist lines and bold open spaces, giving it very much the feel of a something Scandinavian transplanted to the undulating landscape between 100km south of Frankfurt. (Your correspondent never saw the former premises at Heilbronn, but, by all accounts, the new HQ is a vast improvement.)

Then came the reorganisation. This was SDUK’s big reveal at PLASA time last year, October 2013, when MD Peter James evangelised over the realignment of the business to one focused on a vertical market approach: Retail, Pro, and Systems. (This followed similar, earlier restructuring in Germany.)

Step four is the ‘Go-To Market’. This item breaks down into a number of key threads, while disclosing the new Shure “mantra”: ‘Drive qualified leads to quality retailers, and simplify the buying process’.

“We asked our retail group, what are the top ten problems? Number one was, get the customer, and make them go to the shop,” says Proesser. “It’s all about putting the right product in front of the right person. [Then], appropriate pricing for end users and dealers. Provide training. Get internal and external knowledge, and share it.”

The dealers nailed it, it seems. This highlighting of a number of requirements saw Shure put a number of initiatives in place.

A website that was easier to navigate, for instance, which “didn’t require you to understand what PGX was while searching for wireless,” suggests Proesser. Plus, one where those outlets who have a kit available to purchase will be clearly flagged up for the customer.

Creating online communities, for the B2C markets as well as B2B, while respecting the various territories, is another factor. (“The Germans love the technical stuff, while in the UK, it’s more about brand and ‘feel-good’ stuff…” remarks Proesser.) Recognising this community – but elevating the interaction above the normal Facebook-style website – has been another winner. Look no further than last year’s ‘Remix Snow Patrol’ challenge, or the ongoing ‘Call for Legends’ “coolest band” competition, which saw 200 bands upload their tracks and 140,000 plays on SoundCloud.

“It’s not about generating quick sales – it’s about doing something only we can do, which is building the brand based on user interaction (User Experience Campaigns). Next time they think about buying a mic, Shure is on the top of the shopping list.” Proesser says Call for Legends saw a major (up to 60%) increase in dealer enquiries to the associated dealers during the campaign.

And so to the fifth, and perhaps most important, overarching strategy: the decisively named ‘Distribution 2.0’.

In a nutshell, it’s a fundamental analysis and re-evaluation of the partner network. Shure looked at the current model, and decided it was better to supply qualified leads to a limited network. In other words, not every dealer gets to sell every product, resulting in resellers being reclassified by their primary market focus.

“We say: can this dealer really sell a ribbon microphone, or is it just cool to have one?”

In short: in the three vertical markets, certain resellers can only sell certain items – physically and online. Retailers are divided into Shure Centers, Shure Premium Partners and Shure Partners, each with a certain number of lines to sell.

With self-reference, Winkler smiles: “If all a dealer can do is discount a 58, I know an organisation that can do better than that….

“That’s not the long-term goal here.”

At the lowest tier, Shure Partner status, the store gets only nine products to sell. “And you can imagine that they are not happy to hear that, having got 100s of products from us over decades.

And the big reveal here was that even those resellers generated 5% more revenue with fewer lines to sell – a first indication from the German market. “So it works,” says Proesser. He adds it was like “taking a toy from a child, but one that they never played with”: they found they missed it but – in reality – they didn’t miss it at all.

The bonus stage to the new arrangement, if you will, is the Shure Academy European Audio Network, or SAEAN. “It’s not just a way of best advising people how to use our products, it’s also a networking platform,” says Proesser.

The Academy has rolled out in Germany and the UK, and will go direct to end users in 4–5 other territories. And where content is king, Shure are ensuring that information and education is plentiful. There have already been over 20 events since the German launch in October 2012. Much more is planned: video content, boot camps, all the learning you can eat.

Of the training programme and SAEAN, Winkler says:

“In preparation of products and systems you are going to bring to market, if you don’t have the basic infrastructure in place, then you can’t sell them. That’s what we are doing.”

He continues: “Then aside from that, we thought, can we bring more benefit? Can we help guys develop their business alongside us? Retailers, integrators, rental firms…”

Proesser highlights the Shure Brand Space, the ‘shop within a shop’ device: a 2m x 2.4m installed ‘booth’, showing clear demarcations between the various categories of microphones, between analogue and digital, etc. He says sellers scoffed when they saw them, but when Shure offered to provide training too, the brand space came into its own. “The ‘knowledge high’ was much greater… and sales increased. It all paid off.” Now there are 250 such Brand Spaces in over 18 countries.

So, ultimately Shure will supply quality and competence. And that, in the end, is the real key, says Winkler. “It’s all about how you differentiate yourself. How do you compete in the future?

“You can have the best products on Earth. But if you fail to engage, the business won’t come back. So, it’s about great products, good technologies, and quality support.

“It’s quality and competence.”