Harnessing technology to build winning promotional plans
Recently Acumen sponsored the Grocer Conference: ‘How to win with technology in retail sales and marketing’ at the Cavendish conference centre in London. Nick Ryan, our CCO, held a breakout session on ‘Harnessing technology and artificial intelligence to build winning promotional plans between suppliers and customers’ which provoked lots of interesting discussion, as delegates shared their experience as well as the challenges they face.
The sort of barriers FMCG organisations face when implementing effective promotional plans is wide and varied. These include the debate whether promotions grow category or just steal market share, the dilution of display impact, measuring volume on deal and trade spend escalation, the complexity of multi-channel programmes – the list is endless. These challenges affect both suppliers and retailers.
Leveraging the latest technology presents a significant advantage when optimising promotions. It has increased the effectiveness of promotions, provided greater visibility and control, increased forecast accuracy and provided greater levels of efficiency within organisations. Moreover, technology can be used to strengthen levels of communication between suppliers and retailers.
Our work has been able to establish optimum pack price points by undertaking machine learning analysis, depending whether you are putting up profit or growing market share. Looking at promotions, we’ve been able to optimise promotional calendars and provide deeper understanding of performance drivers and scenario modelling through advanced analytics.
The work we have done has created opportunities for collaboration between suppliers and retailers. This includes building promotional plans in a more collaborative way, based on metrics for both parties, and combining resources to leverage data to build the most effective plans for customer & supplier.
There are still challenges, however, when trying to optimise promotions. Both sides require the data they need to make decisions and it is rarely possible to optimise promotions in-flight. Both parties need to be using the same success metrics and understand that tracking of promotional execution is crucial.
Further challenges arise when collaborating between suppliers and customers. The promotional planning and execution process needs to be well understood, and then there’s the question of automation. Common platforms and standardised metrics are required for a successful collaborative partnership.
Our breakout session with the conference delegates brought up the following conversations:
So, what can you do now? The truth is there will always be barriers – however, it’s important to get the below right in order to confidently make assumptions and get the most out of your technology:
Manage your data carefully – meticulously gather what you have into one common platform in order to draw insights and take action when implementing your promotional plan
Draw up a list of questions that you want to answer from your promotional plans e.g. are we promoting too often? And use these as a guide for choosing the right technology
Focus on a collaborative partnership – standardise metrics where possible and utilise common platforms across teams to drive communication and collaboration.