[Part 2] Why Trinity, which makes money by “market-in”, values ​​“product-out” product development

Trinity is a smartphone-related accessory manufacturer with 23 employees located in Niiza City, Saitama Prefecture. In the first part, we explored the essence of the marketing strategy that allowed the company to gain a large market share by producing a huge variety of products at each dealership, rather than competing head-on with major competitors who produce small quantities in large quantities.

Adopting a thorough “market-in” strategy, we pursue products that each retailer wants and make proposals for each department. If you dig deeper into this strategy, you will find hidden strategies that are unique to a small manufacturer.

Part 1:

[Part 1] Trinity, No. 1 in iPhone protective glass, reveals the full story of “marketing that beats big companies”

Risks of relying on online sales

Trinity increased its market share by creating specialized products for different distribution channels and specializing in face-to-face sales at retail stores rather than online sales.

In recent years, many small manufacturers have specialized in online sales, including Amazon, and are increasingly making inroads into the market with limited management resources. However, Trinity’s online sales ratio is only 2-3% of its total sales.

“The results of a strategy that relies on online sales are easily influenced by other companies’ factors, such as the platform’s policies or rival pricing strategies, and there are many areas that we cannot control.Trinity’s products are of high quality and are not cheap. However, It is difficult to emphasize the difference between the products and the low-priced products that are sold together with them, and the market tends to be pushed toward lower prices.I think this is a channel that tends to be a battle of physical strength and carries a lot of risk.

Online, people try to increase their reputation on the site by selling at discounts or distributing coupons at the risk of losing money to improve their rankings, or by including messages offering special benefits to buyers with their products to encourage them to post reviews. You cannot increase sales unless you spend promotional expenses to increase sales. Moreover, the differences in the actual package design, detailed materials, feel of operation, and functionality cannot be conveyed through online sales sites.

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The strength of small-scale manufacturers is that they can make small maneuvers.

“Online sales are more advantageous for items that do not have frequent product changes and sell the same model number continuously, or items that sell in large quantities with the same specifications for a short period of time. Manufacturers are trying their best to keep up.It’s a matter of strength because the first to start working on products that are expected to sell in large quantities will win.We cannot compete with such product categories.

As shown in the example of our current main product, the protective film, by working out detailed sales strategies with mass retailers that sell products in physical stores, we are able to develop detailed sales strategies, including how easy the products are to see when displayed on the shelf. Adjustments can be made to attract the attention of consumers.

At the store, during the business negotiation stage, not only the types of products to be handled but also the actual shelf allocation are decided. Once the planogram is determined, the number of products needed will be determined according to the number of stores handling the product, and it is even possible to adjust the promotion methods in store POP and packaging according to the planogram, each store’s sales strategy, and sales method.

It is said that the accessories for mass retailers, which are tailored to each department, are not exactly the same as products sold at other stores in the same genre. It will also be easier for retailers to sell as they will not be in direct competition with rivals.

Trinity’s ability to work hard and change the sales floor itself, which only a small manufacturer can do, is a specialty of Trinity that cannot be imitated by its larger rivals.

The origin of motivation is “Create what you want”

It may be said that Trinity’s only strength is its market-oriented manufacturing that is tailored to the sales floor, but that is not the case. While it is important to respond to the needs of the field, it is difficult to maintain the motivation of product development staff and sales staff by doing so alone.

To begin with, the company’s main product, protective tempered glass for smartphones, is a really simple product. In order to emphasize the difference with such a simple product from other companies, the experience from encountering the product to starting to use it must be optimized, otherwise customers will complain that the product is not what they expected.

Such complaints not only damage the brand, but also damage relationships with its distribution partners. However, as a result of repeated efforts to ensure that they do not fail, Trinity’s products are easy to handle. At some stores, customers who are unsure of what product to choose will be asked, “Shall I put a protective film on it?” and will choose Trinity products. This is because Trinity provides store-specific equipment for store staff to apply the stickers neatly, supporting everyone so that they can do their jobs professionally.

The reason we are able to come up with ideas like this is because we have the idea that it would be nice to have something like this. Protective tempered glass, now a market-based development, was also a new genre. The starting point is product-out manufacturing. Employees are able to maintain their motivation because they are constantly trying new genres.

Hoshikawa himself launched “NuAns” as a brand with unique ideas to improve the quality of lifestyle, and within that, he focuses on the feel of the material and develops products with a focus on design. We have taken on the challenge of developing a brand that is different from the product itself.

“You charge your smartphone every day, right? That’s why I want to put a charging stand next to my bed.I read before I go to bed, so I want to play some background music while I’m at bed, so I want it to have speaker and lighting functions.If I want to put it next to my bed, I’d also like a clock app. We wanted to improve the experience of waking up by having an alarm sound from the speaker and brightening the lights at the same time.With this in mind, we launched the NuAns brand stand light “CONE” in 2015.

If it doesn’t exist in the world, we’ll make it ourselves. In order to encourage people to experience this idea and the real thrill of manufacturing, we conduct an internal call for products that are no longer on sale but that we would like to see once every six months.

The employee who comes up with the idea becomes the product owner of the new product and is in charge of product development until the end until it is delivered to the market. This is the source of Trinity’s vitality.

NuAns has also taken on the challenge of developing smartphones in-house. In the same year, in 2015, it released the smartphone “NuAns NEO” that adopted Windows. 10 Mobile. In 2017, we launched the NuAns NEO Reloaded, the first SIM-free smartphone compatible with Osaifu-Keitai. At the time, it was unusual for Trinity, which had about a dozen people, to work on smartphones alongside a major manufacturer.

“Not interested” in expanding business scale

Although he has ventured into new genres so far, he declares that he has “absolutely no interest” in expanding the scale of his business. I wonder why?

“I don’t intend to expand my business. I don’t think there is a genre that I would invest in that would result in a loss, and I don’t have any plans to go public because I don’t need to raise funds.”

Trinity’s equity ratio is high at 82%, and it is in a position to run its business solely on its own capital without borrowing money. As mentioned in the first part, in the fiscal year ending April 2023, the company recorded a pre-tax profit of 330 million yen on sales of approximately 4 billion yen. It has maintained roughly the same level of revenue over the past several periods.

This is what Hoshikawa told me about 10 years ago.

His words are, “Even if the company’s sales are cut in half, I want to be a company that can continue to pay salaries without going bankrupt for 10 years.” Working in a small company in the suburbs is a risk for employees as well. That’s why it was necessary to appeal to employees that the company was financially sound.

Since we are a self-financed company, we can take on projects that we genuinely want to pursue without interference from outsiders. Although it would be possible to build a new building for the company in this area, the company renovated the warehouse of the noodle factory that it rented when it was founded. As I continued to use it as an office, I unexpectedly decided to purchase the land and building. “Personally, I have no aspirations for Tokyo. Niiza City is where I grew up, and I have a strong desire to continue living here and contributing.”

We are currently developing new products while incorporating the opinions of our employees. It is planned to be introduced gradually from 2024 onwards. (Title omitted)