Consumer Goods Technology - October 2018 - 16

CONSUMER GOODS TECHNOLOGY

TRADE

PROMOTION
MANAGEMENT

REPORT 2018

clearly reflected in the 71% of respondents favoring daily reporting
(Figure 6).
The benefits to both CPGs and retailers are numerous, including
better tracking of market basket/pantry loading and in-store
shopping patterns. The support for daily data analysis also
includes the ability to better track response to consumer-direct
marketing campaigns and to facilitate more timely responses to
social sentiment (Figure 6).
Past survey data has found that OOS conditions can be the cause
of failure to achieve positive ROI in as many as two-thirds of poorly
performing campaigns. That trend may be improving, with 57%
of respondents here saying that OOS conditions occur in less than
one-third of their promotions. But almost one-third did not know
if OOS conditions impacted promotions.
POS data contains far more information than most CPG
companies receive, especially if they buy it from syndicated
research providers. Twenty percent of respondents say retailers
need to do a better job with on-shelf inventory management (Figure
7). Direct POS acquisition could help that visibility.
A considerable amount of money and focus has been devoted
to identifying and rectifying OOS conditions, especially from the
supply chain, transportation and logistics lines of business. Yet we
continue to have this problem. Even when daily inventory data is
available, most trade promotion and supply chain systems fail to
provide sufficient alerts to take appropriate actions. Respondents
were in strong agreement that being able to track inventory daily
could potentially end out-of-stock conditions at the shelf.
Of course, daily tracking is only beneficial if the appropriate
actions can be taken when alerts are sounded that low inventory
conditions exist - either in the supply chain, warehouses or store
stock rooms. In fact, the survey indicates that the solution most
often requires action on the store floor: poor stocking practices
by the retailer and failure to adequately audit conditions by
retail execution merchandisers. This is a growing issue among
Capgemini's clients, and one that seems to be a growing focus
among retail and CPG executives.
Most CPGs will admit to a need to increase the effectiveness
of their trade promotion analytics, and nearly one-third of the
executives polled feel their analytics are either poor or non-existent
(Figure 10). Almost two-thirds believe that their analytics tools and
performance measurement are at least satisfactory, with only 9%
saying they feel their company does very well (as indicated by their
ability to measure multiple metrics on promotions).
Regarding pre- and post-promotion analyses - specifically,
which metrics are most commonly measured and reported -
the survey asked respondents to identify their top two metrics
(Figures 8 and 9).
For pre-promotion, we expected the top two selections to be
sell-in volume and revenue. Not surprisingly, sell-in volume was

16

CGT | OCTOBER 2018 | CONSUMERGOODS.COM

Benefits of Daily Measurement
What would be the greatest benefits of daily
trade performance measurement (select two)?

F I G U R E 6:

Let retailers better track store traffic,
market basket/pantry loading and in-store
shopping patterns to provide CPGs with
better planning intelligence

71%

Better align trade performance with real-time
consumer response from digital marketing

49%
46%

Potentially end out-of-stock problems
Allow for more accurate, timelier response to
social sentiment analysis

34%

How Retailers Can Help Brands
What's the most important action retailers can take
to increase ROI for packaged goods partners?

F I G U R E 7:

11%
Make more shopper
(i.e. loyalty) data
available

3%
They can't
really do
anything

40%
Collaborate
more openly
in promotion
planning

20%
Provide daily
inventory data to
better track onshelf availability
26%
Improve compliance
across all stores

Pre-Program Measurement Priorities
What are the most important metrics to measure before
executing a promotion (select two)?

F I G U R E 8:

66%

Sell-in volume

51%

Predicted incremental POS

40%

Incremental sell-in revenue

29%

Store-level inventory
Predicted incremental retail gross profit

14%
Consumer Goods Technology - October 2018

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