How Manufacturers Can Manage (and Capture) Data

Manufacturers tend to lack visibility into their key points of influence for a few reasons. The two main issues lie in their relationships with their distributors or down channel partners and in an inability to process the data that they do have.

Lincoln Smith of HMI Performance Incentives asked Matt Gibson, who has 28 years of experience within the manufacturing and distribution channel, to answer questions about data management for manufacturers.

This Q&A will give you exactly what you need to capitalize on your data and strengthen the relationship with your distributors to have them give you the data you need.

Part 1: Sourcing Data & Distributor Relationship Management.

Smith: If you’re a manufacturer going to market through distribution, what are some ways that you can collect data through that relationship and gain any business insights from them?

Gibson: Start with the end goal in mind. Collecting data through loyalty programs starts with a clear strategy and an understanding of what market variables you are trying to manage. Second, you need to understand the customer and what motivates them. Building a regular, reliable voice of customer process can ensure that manufacturers understand the customer journey. Finally, you must ask yourself what data is critical versus nice to have.

The desired outcome is to obtain as much data as you can get without generating a poor customer experience – your indirect customers may challenge your process if they feel you are creating non-value-added administrative work for them. As you combine and align your strategy with the needs of the customer you will begin to see how you can build programs that deliver success and create the opportunity to collect meaningful data.

Smith: If you find yourself on the receiving end of less data from your distributor, what can you do to counter act it?

Gibson: I found that often most distributors were open to sharing more data on a short-term basis if they understood why you wanted the information and what your desired outcome was. As you prepare for that conversation, be open to how you can help solve for any added administrative burden for their team that your request generates. (e.g., the manufacturer providing administrative or financial support for the added workload)

Smith: What are some tips for manufacturers to maintain a healthy data flowing relationship with their distributors?

Gibson: Here’s what I’ve found to work:

    1. Be aware of competitive programs and how they work, both in your market and in peripheral markets.
    2. Each distributor has a person or people who gather and report the data and a leader who manages that person or team. Develop and foster a relationship between your team and theirs.
    3. Have an effective communication plan and lean towards overcommunication.
    4. Monitor distributor feedback closely, act when necessary to address issues quickly, and communicate the outcome of your actions to all stakeholders.
    5. Evaluate your program regularly to ensure that it aligns to your strategy, that it incentivizes the right behaviors, and that it creates a positive customer experience.

Smith: What’s one key area you think manufacturers should be investing in in 2023 as it pertains to rebate data?

Gibson: Build systems and processes to accurately show the price waterfall for your products inclusive of all incentives and rebates. Some manufacturers treat public facing rebate programs as a marketing expense that gets peanut butter spread evenly across the profitability of all products in the portfolio.  Getting a clear view of the net profitability at the product line level is critical to ongoing strategy development.

Part 2: Data Management & What to Do Once You’ve Got it.

Smith: What does the typical database of a manufacturer look like?

Gibson: Based on the work I have done recently I feel that many manufacturers either have not implemented a CRM or have implemented one poorly where its sole purpose is capturing direct and indirect customer contact information.  Manufacturers who have positioned themselves to be closer to the consumer tend to have built more advanced systems where they are using these systems to distribute leads and manage loyalty programs.

It is rare (and maybe non-existent at this point) to find a manufacturer who has a fully integrated system where their data is flowing in an integrated way between ERP, CRM, and elements of the marketing technology stack.

Smith: What are some challenges that are stopping manufacturers from capitalizing on the data they already have?

Gibson: I feel that the main driver here is a disconnection between the functional leaders of sales and marketing organizations and the boots on the ground individual contributors who understand system capabilities. Functional leaders that are willing to learn and like to be hands-on with the work their teams perform have an advantage here as they are more likely to be exposed to the “art of the possible” where they can use their expertise to decide what data would or could be interesting.

Smith: If running rebates for indirect customers, what are some examples of best practices from a data perspective?

Gibson: The programs I was involved with required indirect customers to submit proof of purchase in the form of invoices or reports.  First and foremost, capture as much data from those sources as you can afford. Beyond being able to benchmark market pricing trends for your own products you can better understand the customers average total costs for work they are doing, the ratios of accessories to core products, what percentage of the bill is your products versus other categories you are not participating in, the pricing for products substituted from your competition.

Second, make sure there is a check-and-balance method in place to identify anomalies in the data (e.g., the percentage ratio of the rebate to the extended cost of the product) to eliminate the potential for rebate overpayment.

Finally, if you are gathering data from the same source for multiple programs, be strategic in building your systems such that you are only processing the inbound data once versus multiple times. Having customers supply you with the same data more than once can lead to a poor customer experience for them and added processing work on your end.

Smith: What can you do with rebate data as a manufacturer?

Gibson: From my experience leading marketing teams, I can tell you that gaining access to quantitative data is gold.  Often in marketing the data you are working with is qualitative, leaving it open to interpretation, or it is generated through third parties where the source of how they derived the data is unknown.

Quantitative data generated internally can help you make decisions about strategy, support market pricing decisions, identify if the programs you are running are in alignment with and delivering results against the strategy you have built, identify which customers (both direct and indirect) are true partners versus cherry-pickers, and more.

Smith: What, outside of your distributors, are some ways to collect rebate data?

Gibson: If you do not have access to your distributor partner’s data or POS data streams to collect the information, the methods rely on your sales team or the indirect customer and become very administrative.

The four types of submissions I have experience with are…

    1. Customer invoices (accurate and the most detailed)
    2. Distributor reports obtained by the customer (accurate but less detailed)
    3. Purchasing reports generated by the contractor (less accurate and less detailed)
    4. Reporting generated by your sales team (a non-value-added activity in my experience)

Gaining access to the original customer invoice provides the most data but requires a tremendous amount of processing time.

One unique way that I have seen for manufacturers to access the data when it may not be available from distribution is in the window industry where manufacturers often provide their distribution partners with product quoting/ordering software. Contractors are given a company ID number that they provide to the distributor(s) they work, and points are tracked centrally by the manufacturer for the indirect customer.

Smith: What kind of personnel should a manufacturer look to employ to help with data management?

Gibson: As with all successful teams, you need diversity in their background, approaches, and preferred working styles. A successful data management team needs to have a mix of people that includes strategic thinkers, data analysts, system experts, accuracy addicts, problem solvers, and process people.  Everyone on the team must be customer centric and focused on delivering a positive outcome in all situations, as oftentimes the participants in these programs are some of your largest, most loyal customers. Most critically, the team needs an effective leader who understands the value of each of these skills and can manage the differing personalities and priorities of the individual team members.

Closing Out

Smith: In closing, any other general takeaways that could be really critical to success for manufacturers trying to capitalize on data?

Gibson: Focus on your strategy and set your goals up front. Don’t just set it and forget it either. You’ll need to consistently monitor your program to make sure that it’s still firing the way you intended.


We greatly appreciate the time that Matt Gibson afforded us to help clear the air on manufacturing data strategy. If you enjoyed this content and want more, make sure to reach out to Matt Gibson on LinkedIn! For more incentive insights from HMI, join to our growing list of sales and marketing subscribers!