University Communications and Marketing

November 9, 2010

Contacts:

Dr. Tim Wilkinson, College of Business, 657-2134
Dan Carter, University Relations, 657-2269

‘The Distribution Trap’ selected from four finalists by American Marketing Association Foundation

MSU BILLINGS NEWS SERVICES — The American Marketing Association Foundation (AMAF) has selected “The Distribution Trap: Keeping Your Innovations from Becoming Commodities,” co-written by Montana State University Billings marketing professor Dr. Tim Wilkinson, as the recipient of the 2010 Berry-AMA Book Prize for the best book in marketing.

Co-written with Andrew R. Thomas, “The Distribution Trap” explains that it is time for U.S. companies to wake up to the destructive mass-marketing theories that have cut their profits, diminished their reputations and sent American jobs overseas. 

Current marketing and distribution notions, the authors contend, have wrongly convinced thousands of U.S. innovators that the sale and distribution of their products and services is better left in the hands of outside forces. By catering to the mass market, innovators are allowing mega-distributors to dilute the value of their products and services, imposing costs and changes in strategic direction and operational control. 

The first section of the book explains the distribution trap, detailing how it hurts companies by forcing them to reduce costs, often by chasing cheap labor overseas. The second section details how to avoid the trap, it’s a lesson U.S. companies ignore at their own peril.

Wilkinson, who is currently serving as the interim dean at the MSU Billings College of Business, is associate professor of marketing.  His work has appeared in the MIT Sloan Management Review, the Journal of International Business Studies and the Wall Street Journal.  Thomas is assistant professor of international business and associate director of The Taylor Institute for Direct Marketing at The University of Akron, Akron, Ohio.  He is a New York Times bestselling writer who has authored, coauthored, or edited 15 books. 

For Wilkinson, who has been at MSU Billings for about five years, the book is not one of those tomes to take a whack at Wal-Mart. It’s more of a business management cautionary tale, a book filled with case studies that illustrate what happens when innovators see mega-retailers as a quick path to fame and fortune.

“We try not to blame them (mega-retailers like Wal-Mart),” Wilkinson said last spring when the book was published. “They have a business model that works just great for them. It’s a power relationship with manufacturers.”

And it’s a relationship that attracts plenty of suitors, he said. Plenty of well-intended but starry-eyed innovators make the trek to Arkansas (Wal-Mart’s home base) to try to partner with the company and get their product in front of millions of customers.

“The Distribution Trap” maintains that by taking that step, innovators are wrongly convinced that the future of their company is best left in the hands of others who really don’t have the blood, sweat, tears, time and money invested in their product.  The mega-retails depend on volume, mass marketing and low prices and in order to maintain their end of those power relationships, the small manufacturer has no choice but to ratchet everything up.

“They are put into a box where they have to constantly produce and keep feeding the machine,” Wilkinson said. “So they go big into debt. It’s a very dangerous situation.”

Other finalists for the Berry-AMA Book Prize were:

• “Africa Rising: How 900 Million African Consumers Offer More Than You Think” by Vijay Mahajan.
• “Socialnomics: How Social Media Transforms the Way We Live and Do Business” by Erik Qualman.
• “The Next Evolution of Marketing: Connect with Your Customers by Marketing with Meaning” by Bob Gilbreath.                                                                       

The selection of the Berry-AMA Book Prize winner and finalists included a five member team of marketing experts led by Richard Lutz, J. C. Penney Professor of Marketing (University of Florida). The judging panel also included Francesca Cooley (American Marketing Association), Erik Gordon (University of Michigan), Gordon Wyner (Millward Brown Inc.), and Valarie Zeithaml (University of North Carolina).

According to Lutz, “Though it isn’t a summer beach novel, ‘The Distribution Trap’ is nevertheless a real page-turner.  Building on the premise that cracking the ‘big-box’ channel is not necessarily the Holy Grail that many marketers assume, the authors make a strong case that marketers of innovations should control the channel themselves.  By so doing, they may forgo some volume, but that is more than offset by higher margins and stronger brand equity.  ‘The Distribution Trap’ offers a fresh perspective on one of the original decision areas in marketing.”

The annual Berry-AMA Book Prize recognizes books whoseinnovative ideas have had significant impact on marketing and related fields. The prize is one of the AMAF’s programs designed to acknowledge academic and practitioner marketing excellence and is named in honor of Leonard L. Berry, a distinguished professor of marketing at Texas A&M University, and his wife, Nancy F. Berry.

Exceptional marketing books that have set the standard for excellence and that were published within the previous three years (2007, 2008 or 2009) were eligible for consideration to receive the 2010 Berry-AMA Book Prize.

For more information about the MSU Billings College of Business and its programs, go to www.msubillings/cob. For more information on the For additional information about the Berry-AMA Book Prize, please visit Berry-AMA Book Prize.

PHOTO ABOVE: Dr. Tim Wilkinson, professor of marketing and interim dean at the MSU Billings College of Business, was recently named recipient of the 2010 Berry-AMA Book Prize for his book “The Distribution Trap: Keeping Your Innovations from Becoming Commodities.”