When we talk about catchment areas, you're probably wondering what this has to do with you. Well, it doesn't just concern retailers and chains, but also... your brand!
Let us show you how this analysis tool can also help you, whether to define your distribution strategy, or to improve the efficiency of your marketing and sales departments.
The term "catchment area" refers to the geographical territory within which a sales outlet attracts customers. In other words, it's the area in which a store's potential customers live, work or travel.
The catchment area covers not only the current clientele of a sales outlet or brand, but also its potential clientele.
It is defined by the distances and travel times required for customers to get there, as well as the socio-economic characteristics of the area concerned.
It is therefore a powerful geomarketing tool that enables distributors and sales outlets to identify strategic location opportunities and assess the penetration rate of a local market.
The catchment area is generally divided into three sectors, which enable a more detailed analysis of the attractiveness of a sales outlet:
Now we come to the more technical, yet necessary, part.
There are four main methods used by sales outlets to determine their catchment area:
The aim is to understand where potential customers are, and how to bring them to the point of sale.
Your products are great, but where are the customers who love them?
To measure an area's interest in terms of revenue, distances and travel times are not enough! To assess a territory's commercial potential, you'll need to cross-reference geographical indicators with socio-economic data and, as we'll see a little later, consolidate all this with your distributors' consumption data.
L’étude de la zone de chalandise permet de valider votre instinct avec des statistiques. Plutôt que de s’appuyer sur des hypothèses, vous pouvez évaluer le potentiel commercial d’un territoire - et connaître précisément sa clientèle - sur des critères d’évaluation précis.
Here are a few criteria that can be used to achieve a finer level of granularity in interpreting the potential of a catchment area:
To this end, INSEE provides a number of tools for studying local statistics.
En réalisant cette analyse, vous allez pouvoir comprendre les disparités de potentiel de vente d’un territoire à l’autre. Cela vous aide à prioriser les points de vente en fonction de leurs potentiels gms mais aussi d’adapter la pression commerciale.
En tant que marque intégrée à la distribution, vous pouvez utiliser l’analyse des zones de chalandise pour mieux sélectionner les points de ventes dans lesquels distribuer vos produits. En effet, en identifiant et analysant les zones de chalandises, vous allez mieux connaître votre territoire de vente et donc, mieux vous y adapter. Vous allez ainsi savoir quels produits proposer avec quel packaging, et à quels prix. En d’autres termes, analyser ses zones de chalandises, revient à répondre (en partie) au 4P de votre mix marketing : produit, prix, distribution et promotion.
Cela vous aide également à comprendre les strates magasins, mais surtout, les affiner. En effet, en croisant la zone de chalandise avec d’autres données (type de quartier, flux, saisonnalité, densité de population…) vous aller affiner les strates magasins (pour votre marque) au-delà du simple critère de part de marché. Cela vous aide à construire des stratégies commerciales plus localisées, et donc plus efficaces.
C’est sur ce point que la zone de chalandise est importante pour vous, en tant que marque. Deux magasins peuvent avoir un sell-in ou une DN similaire, mais une zone de chalandise différente. Cette dernière remet ces chiffres en perspective et aide à identifier les produits et formats phares selon le territoire, mais aussi à distinguer un “petit magasin” performant d’un hypermarché sous-exploité.
Here is a non-exhaustive list of potential benefits for your brand:
The best potential inevitably attracts competition. So don't limit yourself to sectors with high demographic and purchasing power indicators. The presence of competitors can have a considerable impact on forecast sales.
Bear in mind that if many retailers distribute your product range, their reflex in an ultra-competitive environment will often be to lower their final selling price or play on margins. In this case, your distributors could pass on this pressure to you, by asking you to assume the price cut.
But, paradoxically, increased competition will also tend to increase overall traffic in a catchment area, and therefore sales opportunities for your products.
The aim is to balance potential and competition to find the sweet spot!
These concrete examples illustrate the link between the supply network in a given region and the commercial opportunities available to manufacturers. In fact, the catchment area covered by each of your distributors should be studied in terms of both sales potential and competition density. A vast subject!
With the catchment area, targeting the consumers most likely to buy your products takes on a whole new dimension.
While manufacturers of mass-market products tend to want to sell everywhere to maximize distribution intensity, innovative brands or those with specific targets may need to consider much more selective strategies.
A few examples to illustrate this idea:
We explored external data sources above. Let's now turn our attention to analyzing your own data, and - trade marketing be damned - the data your distributors share with you.
The study of your datasharing can tell you a lot about who buys your products. That's why you need to negotiate your checkouts skilfully with chains and stores.
Alternatively, if you also sell via your own channels, for example on your online sales site, you can try to draw analogies between e-commerce and physical points of sale. But beware of false reasoning...
Finally, it's important for you to monitor the average basket in the outlets where your products are sold. You should also monitor consumer indices to compare them with your own observations in the field.
The presence and performance of your competitors in a given region are essential to adjust your strategy accordingly. Data, however, can be hard to come by. Here again, datasharing is an important lever to activate: are your distributors willing to share sales data on competing brands with you?
In any case, the minimum requirement for a retail-integrated brand is to use a retail performance CRM.
Finally, you can use predictive models based on variables such as previous buying behavior, demographic trends and economic factors to anticipate the expansion or reduction of a catchment area. The help of an external company or expert may then be required.
Vous avez récupéré et analysé ces données terrains. Vous pouvez alors utiliser ces analyses pour réorienter les différents aspects de votre stratégie d’entreprise, et pouvoir les transformer en profits. C’est sur ce point que vous pouvez optimiser le “P” promotion de votre marketing mix.
One solution: adapt your strategy to local conditions. Every region is a new opportunity!
The first winner of this approach is, of course, your marketing department. A brand that understands its catchment area can adapt its methods to the specific needs of the different zones it addresses.
These marketing efforts can focus on personalizing offers with local products, promotions, merchandising or other promotions to support your products in more competitive areas, or areas where your brand is less popular.
Une étude de zone de chalandise correctement effectuée vous permet de comprendre le discours marketing et promotionnel auquel chaque client ou groupe de client sera le plus sensible. Il permet aussi de comprendre le format, et donc, d’adapter vos investissements publicitaires de la sorte. Par exemple, selon Je bosse en grande distribution, le prospectus en boîte aux lettres peut représenter le canal privilégié dans certaine zone métropolitaine (avec plus de 45% d’attention), là où la promotion en point de vente ou encore les réseaux sociaux dominent sur d’autres.
You can also optimize your advertising campaigns, since you now know which territories have the greatest potential, or which are the most hotly contested, either by your industrial competitors or by distributors competing with your own!
To conclude, let's take a look at the various limits or precautions to be taken when determining catchment areas:
The catchment area is not just for department stores. It is also decisive for brands that sell via a distribution network.
Having the ability to know and understand a territory and its population enables your brand to optimize the location of the best points of sale, personalize its offers, and improve its marketing tools.
If you can meet the challenges of the catchment area, this weapon can become a real asset in the development of your distribution strategy.
Are you ready?
