Recent survey of distributors reveals opportunities for LED manufacturers

May 26, 2009
Date Announced: 26 May 2009 Raleigh, N.C. - A recent survey of electrical and lighting distributors demonstrates the importance of the sales channel for LED lighting manufacturers in gaining access to the emerging solid-state lighting market. The survey was conducted by Energy Smart Marketers, a marketing agency focused on the LED market.According to the survey results, distributors make the recommendation to the end customer about which brand of LED lighting to specify almost 60% of the time; and more than 80% of distributors surveyed sell as many as seven different brands of LED light engines or fixtures.Yet, 78% of the distributors also said they were not receiving enough product and sales training from LED suppliers, indicating that there is an opportunity for LED manufacturers to expand their sales through distribution by increasing the level of product training and education. "The results of the survey make it clear that for widespread adoption of LED lighting technology to occur, there will need to be a focused effort by LED manufacturers to educate their distributors on LED technology to differentiate their company," said David Gordon, principal, Channel Marketing Group. "The survey also confirmed that lighting and electrical distributors are the most important sales channel that LED manufacturers can use to reach the end customer with their product message."The survey was conducted with 1100 people from 400 different electrical and lighting distributors. Among the results:· Nearly all respondents (98%) believe that the overall market for LED lighting will significantly increase in the next three years.· More than 89% of the time, the distributor recommends the brand of LED fixture, confirming the critical role that distribution plays in the sale of LED lighting.· Most respondents (72%) said that it was very important to know the name of the LED component manufacturer in the fixture.· More than 80% of distributors surveyed sell up to seven different brands of LED light engines and fixtures.· Although 89% of the respondents currently rely on manufacturers' reps to learn about LED products, the same percentage indicated that they were not satisfied with the level of product training and education they were receiving from the manufacturers.· Other concerns identified in the survey included return policies, inventory commitment, product warranties, and distributor pricing.The survey results point to several trends in the emerging LED lighting marketplace, according to individuals involved in Energy Smart Marketers, particularly a growing need for programs and promotions that target the distribution channel."LED manufacturers are seeing the value in evaluating and optimizing their distribution channel," said Gordon. "With distributors recommending LED fixtures in almost 90% of the cases, there is ample evidence that manufacturers can influence these recommendations through training, promotions, rebates, special pricing and adoption of distributor-friendly policies.""The survey indicated that a majority of the respondents are relying on traditional electrical distributor trade magazines as an information resource for LEDs," said George Bournazian, vice president, BtB Marketing Communications. "This means that LED manufacturers cannot rely solely on specialized lighting trade journals or electronic component magazines to reach this key audience. There is a clear need to reach distributors directly with education and product training to increase their brand loyalty. This survey demonstrates there is an opportunity for LED manufacturers to take a leadership position with their distributor partners."The complete survey results are available for $199. To discuss other aspects of the survey, contact BtB Marketing at 919-872-8172.About Energy Smart MarketersEnergy Smart Marketers helps LED lighting, wind and solar power manufacturing companies review, evaluate, optimize, equip and energize their distribution networks. Channel Marketing Group's experience in evaluating and developing distribution strategies, coupled with BtB Marketing's communications focus on technology and energy clients, provides companies with "one-stop" shopping for marketing through the distribution sales channel.About BtB MarketingBtB Marketing Communications is a full-service, integrated marketing communications firm dedicated to business-to-business organizations. BtB specializes in serving clients who manufacture components or systems or provide services to the electronic/electrical control, power management, automation and process control, military/aerospace, telecom/datacom, and energy and power generation markets.About Channel Marketing GroupChannel Marketing Group, is a marketing consulting firm for manufacturers, distributors, distribution technology providers and industry associations, focusing on the electrical and lighting industries. CMG has developed strategic business plans, customer satisfaction research, marketing campaigns, incentive promotions, channel and distribution strategies, and product-line positioning in the electrical industry for almost 10 years.

Patricia Staino BtB Marketing

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