E-Commerce Could Actually Prevent Product Diversion. Here’s How.

By Keely Burton | September 6th, 2019

Ever heard the phrase if you can’t beat them, join them? This is the approach animal health manufacturers need to take to e-commerce.

Many manufacturers have long been doing battle with the negative influence of the gray market, which can feel like a mysterious force — blowing your products into corners of the internet and into shopping carts on large online retailer sites, whisking away your data-proven outcomes, and destroying your carefully built reputation.

Most manufacturers have experienced the dreaded negative review left on an e-tailer site you never even sold your product to. Preventing this product diversion from happening is paramount to your brand’s success.

But instead of trying to fight the inexorable pull of e-commerce, manufacturers should be fighting to participate, and win back control of their supply chain by allying themselves with the powerful online retailers they’ve been trying to keep their products away from.

Bear with me. Because building relationships and forming contracts with online retailers is the most productive way forward: one that ultimately protects your brand and connects you to almost 50 percent more customers, whom you’re missing completely if you’re keeping your products offline. Ever heard the phrase win-win?

Here’s how — and why — you should make the dive into e-commerce.

The Winds Are Changing (You Should Too)

Shoppers today expect to be able to buy anything online, from fabric softener to embarrassing 1980s yacht-rock records (whatever floats your boat), and have it shipped anywhere, anytime. Same goes for their pets’ toys, food, and even treatments such as flea and tick medications.

It’s essential in any industry to extend your product reach to online retail, and just because the animal health industry has lagged behind in adopting e-commerce (and in digital sales savvy in general) doesn’t mean it’s any less important. If anything, manufacturers should want to act fast to move into the digital space before their competitors catch up.

According to Packaged Facts’ 2016–2017 U.S. Pet Market Outlook, 46% of consumers purchased pet products online in 2016. That’s almost half of your customers, who will never find your products if you’re not selling to them online — and that number will only grow. Packaged Facts projects online pet products sales will double from 2017 to 2022. That’s the first side of the win.

Consumers simply see handling their pet care online as more convenient for their busy lifestyles. It saves them the time of a trip to the vet or a pet store, and it allows them to choose from a wider pool. What they don’t know are the downsides: that the products they are buying and giving to their trusting pets may be mispackaged, expired, or even fake.

The Online Obstacle Course (and How to Beat It)

How can you make sure that when people find your products online (and they will), they’re buying something that’s been authorized, tracked, and controlled by you, the manufacturer?

Product diversion is a No. 1 concern for many who fear that a pet will experience a poor outcome with their product or drug after their owner has unknowingly bought the wrong product with the wrong labeling and administered it improperly — or that that pet owner will post a prominent one-star review, not knowing why your product failed them.

You can’t provide the best animal health care if you can’t guarantee pet owners are buying your products safely.

Manufacturers will never be able to keep products off large online retail sites. Creating efficiencies and oversight throughout your supply chain will help protect you from product diversion, but consumers won’t go back to a pre-Amazon world. (Internet sales accounted for 17% of market share in the U.S. in 2017, beating out most pet stores and veterinarians, according to Packaged Facts’ U.S. Pet Market Outlook, 2018–2019.) You’ll have to meet them there.

And once you do, product diversion simply won’t be as much of an option anymore. Intentionally selling your products online — instead of allowing them to end up there incidentally — puts supply chain oversight and product quality control back in your hands. (There’s the other win.)

And you don’t have to do it alone.

Leaving the Dark Age (You Can Do It!)

Setting sail on this voyage into the unknown world of e-commerce and navigating the rogue product-diversion pirates who are siphoning off your revenue source, potentially endangering the animals you’ve set out to protect, are a lot easier when you have the right partner with the right expertise.

Ideally, that means a master distributor who can broker exclusive deals with online retailers to ensure those sites can legally only post a product if it was bought directly from that master distributor — not from any other person or channel — and who can ensure logistical oversight and quality control.

A master distributor can establish contracts with e-tailers, thus distinguishing your go-to-market strategy by funneling all e-commerce sales through one source.

That means if your product is being sold online, it’s supposed to be there.
As a master distributor and e-commerce channel partner, EPiQ also helps manufacturers secure their brand’s reputation by performing an online-presence audit and formulating a plan for addressing customer feedback.

Beyond supply-chain and marketing expertise, data and analytics play an important role as well. You’ll need an internet watchdog (so to speak) to track, gather, and handle any commentary and reviews your products receive online. Unless you have resources dedicated to this unwieldy task, it’s helpful to have an expert eye out there to address reviews, find out about adverse events, and manage recalls.

If all of these thoughts are reminding you why you don’t already sell your products online, remember your products probably already are online. But it’s not too late to rescue them from an uncertain fate.

Contact your friendly internet watchdogs at EPiQ Animal Health to embark on your e-commerce journey or regain control of your brand online. We can help.

About the Author

Keely Burton is a seasoned sales professional who has spent her entire 20-year career in animal health distribution, where she has demonstrated leadership and success in building relationships and driving for business results. Keely is now EPiQ’s national account manager for e-commerce. She has a BS in biology and minors in chemistry and dance from the University of Tampa and enjoys spending time with her kids, furchildren, and family. Keely lives in both sunny South Florida and her hometown in the Florida Keys, catching lobster and watching as many sunsets as possible.
Keely Burton
National Account Manager

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