TPO sounds cool, but isn’t it just for the consumer insights group?
To limit trade promotion optimization to only a customer insights department would severely lessen the immense amount of information and insights that the application would give other individuals within an organization.
Shelley Fow, Blacksmith Applications Systems Engineer explains, “In my past, both working for a CPG manufacturer and working with hundreds of different CPG manufacturers on the software side, I can tell you that TPO can and SHOULD touch as many departments as possible.”
- Brand managers can utilize TPO to analyze what the competition is doing and how that impacts your brand. And, you can gain insights into the health of your base business and new products (once they launched).
- Pricing managers can leverage TPO to help the organization determine the best regular and promoted price points, which prices to stay away from, and learn how the competition priced.
- For the promotion approval team, a TPO system guides the discussions and requests for additional spending and how all spend is managed. Without TPO access, teams work out of Excel, but are really flying blind and can be quarters behind on analyzing executed promotions, due to the time spent on data updates before ever gaining insights. Once equipped with the knowledge and insights that a TPO system provides, promotion approval team can make fact-based decisions BEFORE a promotion is offered to a retailer and executed.
- Sales leverages TPO functionality to make fact-based decisions on the best promotional strategies for the retailers.
Across a CPG organization, individuals should be trained to utilize every small detail from a TPO system. There is so much functionality to leverage:
- Post-event data
- Libraries of promotional events (so you can quickly and easily plug into annual retailer plans)
- Visual reports that show spend and the promotional effectiveness
Syndicated Data and TPO Integration
TPO doesn’t require difficult connections or integrations. Integrations between TPO and syndicated are basically an exchange of flat files across an FTP site, which can be automated.
TPO does not require syndicated providers like Nielsen and IRI to work with or provide the data to your TPO vendor. TPO system administrators/users simply upload the syndicated data (in a required format, which T-Pro provides examples of and assists with initial formatting of the data).
“I can’t look at every event, so what’s your best advice on using the tool?”
Through data visualization and reporting, the ability to zero in on promotional events that were either successful or unsuccessful, is easier than ever before.
It’s important to remember that if you analyze events through spreadsheets of data downloaded from your syndicated provider, that you have to update and format the data into your needs. Those hours/days of time, is replaced with actually analyzing the data and then strategizing for future events.
Shelley remembers, “When I worked for a CPG manufacturer, prior to implementing a TPO system, it was my responsibility to analyze each quarter’s promotional events in our top 15 retailers. By the time the data became available, I was able to download it all, and then pull it into the required formats (along with doing my other daily work tasks), I would always be late getting the analysis completed in time for it to be reviewed by the promotional committee, which meant we stayed behind by at least 2 months. Once we implemented TPO, I was able to set aside time when the newest data uploaded into the system and would analyze events which took place during that 4-week period.”
Benefits of Organizational Adoption
- Greater ROI: When more individuals utilize the trade optimization software, you’ll see a greater return than if only one or two people are using it.
- One View of the Truth: Nothing can cause more confusion and problems in an organization than when different departments and individuals analyze base differently (and incorrectly).
- Better Spend Decisions: Of course, the most obvious is utilizing TPO to help make better trade spending decisions with regards to promotional effectiveness. The goal isn’t usually to reduce trade spending, so think how powerful a TPO system becomes when employing it to support that same trade spend to bring in higher volumes and revenue!
TPO for Finance
For many folks in finance, optimizing promotions based on excel equations is working just fine. But life is better outside of excel. The automation and organization from a TPO tool enable data visibility and governance. With TPO, you can easily tell your boss about your top 5 retail customers and justify incremental spending.
How you’ll use TPO:
- Review performance and execution.
- Set strategy and guide the sales conversation.
- Monitor base volume and trends.
- Assess risk. Remove offline planning (and manual mistakes).
- Use scenario planning. Analyze the plan to the forecast.
- Look backwards: Report and analyze.
Account Managers Turn to TPO
TPO functionality is helpful for account managers who want to ensure all plans are inline with corporate objectives.
How you’ll use TPO:
- Create individual promotion plans and volume forecast.
- Create long range plans.
- Review and approve individual trade plans by retailer, price points and custom packaging.
- Guide scenario planning using What If scenarios.
- Monitor sales progress against actual sales and forecasted sales. Identify and communicate gaps and risks.
Transform Trade with Optimization
TPO leverages all of your data – providing you with real insights to take action on. TPO is more than just reporting. TPO makes CPG data better. (Watch a 3-minute demo here.)