• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • SCB YouTube
  • Login
  • Subscribe
  • Logout
  • My Profile
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Express/Small Shipments
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management (Big Data/IoT/Blockchain)
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Sourcing/Procurement/SRM
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • SC Security & Risk Mgmt
    • Supply Chains in Crisis
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Robotics
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • THINK TANK
  • WEBINARS
    • On-Demand Webinars
    • Upcoming Webinars
    • Webinar Library
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » Responsive Trade Promotion Management: Creating a Single Version of the Truth

Responsive Trade Promotion Management: Creating a Single Version of the Truth

February 18, 2009
Nari Viswanathan, vice president and principal analyst, Aberdeen Group

According to Best-in-Class CPG manufacturing companies, the top pressure is the lack of sufficient visibility towards trade marketing-related customer insights that support retail-level execution strategies. Companies lack location and unit-level promotion visibility, shopper insights, and shelf-level sales performance information that enable optimum trade promotion ROI.

The reasons for the deficiency in retail shelf-level insights are due to:

• Sixty-Five per cent of manufacturers use legacy trade promotion systems and home-grown trade marketing processes which do not offer collaborative tools or feature/functionality for shopper insights or buying behavior to their user organizations. These collaborative data sharing, planning and execution-related analytical tools enable visibility towards shelf-level promotion product display optimization, shopper marketing insights, and sales performance data in varied segments such as grocery, specialty or general merchandise

• Currently, 64 percent of manufacturers face internal fragmentation when it comes to trade marketing data, performance metrics, planning objectives and retail compliance guidelines for sales, marketing, and finance organizations

• Point-of-sale transaction data from retail locations is still a hurdle for 66 percent of manufacturers. Such low levels of POS transaction data sharing between retailers and manufacturers leads to increased complexities in tracking promotion effectiveness at the store or field level.

These retail-level tribulations mean that departments at manufacturing companies are currently using: 1) assumption-based forecasts; 2) repetitive planning of corporate, account, and discretionary promotions; and 3) reactive approach towards controlling cost of promotions, which is currently impacting 63 percent of companies surveyed.

The Outlook

Continuous trade promotion management (TPM)-Instead of evaluating trade promotion strategy once in a year or even once in two years, CPG companies need to adopt a continuous improvement approach. The following five ways enable a win-win TPM strategy:

Aligning trade strategy to corporate business goals. Companies need to do Pareto (80/20) analysis based on the profit margin as well as supply chain flexibility and identify the right products to assign trade funds to.

Surgical accuracy in retail level execution. Best-in-Class companies are 1.5 times as likely as All Others to be able to drill down precisely into the data to identify the highest-impact trade activities and then create coordinated programs around these.  Event management for these companies is both science and an art. These companies work closely with their retail counterparts to ensure that a cadence of event management is maintained.

Choosing the right partners. Companies cannot and should not focus their entire effort towards all the retailers. They are able to create an incentive for retailers to participate in the TPM process by taking the bold step of firing their lower-performing customers-in the sense that they may not allow some of their retailer customers to take advantage of some promotions.

Building the right processes. TPM is too big of an area to tackle in one big swoop. Best-in-Class companies are able to perform a prioritization exercise to identify the business processes that have the highest ROI. These companies are able to create linkages/coordination with adjacent organizations to maximize the value of these processes.

Choosing the right tools and training methodologies. The importance of training and tool selection cannot be underestimated especially in a nascent area of win-win TPM. Best-in-Class companies realize the importance of technology as the third dimension after people and processes. However, they do not look at technology as a panacea. Given the organizational boundaries that the TPM processes crosses, training is critical.

    RELATED CONTENT

    RELATED VIDEOS

    Forecasting & Demand Planning Supply Chain Visibility Technology Business Strategy Alignment Global Supply Chain Management Consumer Packaged Goods Pharmaceutical/Biotech
    KEYWORDS Business Strategy Alignment consumer packaged goods Forecasting & Demand Planning Global Supply Chain Management Pharmaceutical/Biotech Supply Chain Visibility Technology
    Nari Viswanathan, vice president and principal analyst, Aberdeen Group

    The Secret SaaS: On-Demand Supply Chain Management

    More from this author

    Subscribe to our Daily Newsletter!

    Timely, incisive articles delivered directly to your inbox.

    Popular Stories

    • A WOMAN STANDS WITH A TABLET COMPUTER IN A WAREHOUSE, SURROUNDED BY SYMBOLS FOR SHIPPING METHODS

      Five Tactics for Enabling Smart and Sustainable Supply Chains

      Data Management (Big Data/IoT/Blockchain)
    • On Demand Webinar_SAP.png

      Optimize your Logistics Pinch Points to Build a Risk Resilient & Sustainable Supply Chain

      Webinars
    • A MEXICAN FLAG FLIES IN A RISING SUN

      Mexico’s Future as U.S. Go-To Trade Partner Depends on Investment, Infrastructure

      Logistics
    • A DRAWING OF TWO PEOPLE ARE STANDING NEXT TO A SQUARE THAT READS "AI" WITH SEVERAL MECHANICAL BRANCHES COMING OFF OF THE SQUARE.

      Enabling AI in Procurement Transformation – The Case For Adoption in the Electric Utility Industry

      Technology
    • A WHITE TESLA VEHICLE SITS IN A PARKING LOT IN FRONT OF A BUILDING WITH THE TESLA LOGO ON IT.

      Podcast | Betting on Electric Vehicles: A Realistic Appraisal

      Sustainability & Corporate Social Responsibility

    Digital Edition

    Scb august 2023 lg

    2023 100 Great Supply Chain Partners

    VIEW THE LATEST ISSUE

    Case Studies

    • JLL Finds Perfect Warehouse Location, Leading to $15M Grant for Startup

    • Robots Speed Fulfillment to Help Apparel Company Scale for Growth

    • New Revenue for Cloud-Based TMS that Embeds Orderful’s Modern EDI Platform

    • Convenience Store Client Maximizes Profit and Improves Customer Service

    • A Digitally Native Footwear Brand Finds Rapid Fulfillment

    Visit Our Sponsors

    Antuit Zebra Anvyl AutoStore
    BEUMER Group Blue Ridge Global Brother
    CHEP Cleo Coenterprise
    Data Capture E2open Enveyo
    Eva Air ForwardX Robotics Frayt
    GAINSystems Generix Geodis
    GEP Global Supply Chain Marketing Summit GreyOrange
    Here Holman Logistics Infor
    Inmar Kinaxis Lexis Nexis
    Locus Robotics Logility LogistiVIEW
    Lucas Systems MCA Connect MPO
    Old Dominion OneRail Overhaul
    PartnerLinQ (Visionet) Port of Virginia Ryder E-commerce by Whiplash
    Saddle Creek Logistics SAP Shyft
    Sourcemap SPS Commerce Tecsys
    TGW Systems Thomson Reuters Veho
    Verusen Walmart Workshop
    • More From SCB
      • Featured Content
      • Video Library
      • Think Tank Blog
      • SupplyChainBrain Podcast
      • Whitepapers
      • On-Demand Webinars
      • Upcoming Webinars
    • Digital Offerings
      • Digital Issue
      • Subscribe
      • Manage Your Subscription
      • Newsletters
    • Resources
      • Events Calendar
      • SCB's Great Supply Chain Partners
      • Supplier Directory
      • Case Study Showcase
      • Supply Chain Innovation Awards
      • 100 Great Partners Form
    • SCB Corporate
      • Advertise on SCB.COM
      • About Us
      • Privacy Policy
      • Contact Us
      • Data Sharing Opt-Out

    All content copyright ©2023 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

    Design, CMS, Hosting & Web Development :: ePublishing