Popcorn, Indiana Case Study
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Popcorn, Indiana implemented a trade promotion management (TPM) system to better manage its trade spending as it expanded distribution. The new system provided visibility into all trade programs in one place, allowed for improved sales forecasting and analysis of promotion effectiveness. It resulted in measurable benefits like reduced deduction balances, improved forecast accuracy, and increased sales and market share without additional trade spend. The case study shows that with the right people, processes and tools, TPM can provide strategic benefits rather than just being seen as a necessary business cost.
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Popcorn, Indiana Case Study
- 1. Case Study: Value & Success is Not a TPM Myth
- 2. Welcome & Housekeeping • Attendees in “Listen-Only” Mode • Type your Questions into the “Chat Box” on the Left Hand Side of the Screen • You Must Dial-in by Phone to Hear Today’s Conversation: (866) 740-1260 Code: 3547026 • Today’s Presenter is Michael Cross, Product Marketing Manager at TradeInsight
- 4. Case Study: Trade Promotion Management • Popping up Gourmet, Whole Grain Snacks That Their Customers LOVE! • Company Began 5 Short Years Ago, With Retail Stores in Malls Selling as Dale and Thomas Brand • Popcorn, Indiana is Now Available at Retailers Nationwide (Food, Drug, Mass, Natural, Specialty) • Competing in Trade-Oriented Category: 40%+ of Volume Sold on Promotion
- 5. Needed to Upgrade Trade Promotion Approach As Distribution Expanded Across Channels • New Customers Demanded Trade Dollars o Needed to Spend and Wanted it to be Effective! • Snack Category is Highly Promoted o Needed to Maximize Display Exposure during Events due to Impulse buying o Consumers Switch between Segments Based on what they “Trip Over” in the Store
- 6. To Get To Next Level, Popcorn, Indiana Looked At… PEOPLE PROCESS TOOLS
- 7. Popcorn, Indiana: PEOPLE • Strong Executive Support, Involved Throughout the Entire Implementation Process • Provided Clear Goals for the Project: o Keep it Simple, so the Sales Team will Use it o Willing to Invest in Technology, but Need Year One ROI o Need a Planning System which will Work Around Our Processes and Distribution Channels (Direct, DSD, Food Service, etc.) o Need a System which will Allow Cross Functional Teams to View a “Single Version of the Truth”
- 8. Trade Spend is No Longer Simply the Cost of Doing Business. It is a Strategic & Controllable Expense Allocated by Us according to Our Business Strategy.
- 9. Popcorn, Indiana: PROCESSES • No “Legacy Process” was Immune from Review • Adopt “Best Practices” From Other Companies • Start with Clean Information in System o Sales History was Accurate, but Spending wasn’t, so Importing it into New System wouldn’t be Advantageous o Critical that Customer and Product Masters are Accurate, and a Great Time to Review Naming Conventions on Products • Develop Reliable Metrics to Allow Measuring Results • Believe the Numbers and Run Business Accordingly
- 10. Popcorn, Indiana: Tools EXCEL is Not a Long-Term Solution! • Fine for Building Budgets and Initial Sales Forecasting, but with Far too Many Limitations • Updating Field Forecasts is Tedious, with Various Versions of Documents Circulating • Changes in Customer’s Promotional Activity and Timing Shifts Hard to Capture • No Feed to Order Management System, Requiring Planned Events to be Set up Independently to insure Proper Allowances are Applied • Deductions Difficult to Clear, and Paid on Customer Documentation, Rather than Planned Promotions • No Post-Promotion Analysis Capabilities
- 11. The ‘Options’ ERP Module Build Solution Software In-House Solution
- 12. Going to the Next Level with Tools • Software-as-a-Service (SaaS) • Hosted Solution • Intuitive, User-Friendly • Implemented in 6 Months or Less • Affordable • Year One ROI
- 13. Distributor Syndicated Retail Data Data Consumption Data Demand ERP Planning Financials One Plan One Place
- 14. Measurable Results • Completed Implementation in 5 Months with a Fully Functioning Planning System in Only 3 Months • Deduction Balance Dropped from 3.5% of Sales to Less than 1% in 60 Days • Reduce Forecasting Error KPI (MAPE) by Half Through Improved Processes and Visibility Enabled by TPM System • Sales +24% and Share +2pts without Additional Trade Spend
- 15. Visibility AFTER Visibility Without Aggregating Spreadsheets Plan, Execute & Pay for all Trade Programs within one TPM System Easier to Communicate Programs/Customer Activities Track Sales and Spend at Program & Customer Level Improved S&OP Process and Aligned Team with One Plan
- 16. Analysis AFTER Measure Lift of Promotions Have Begun to Optimize Promotions o Which Tactics Work Best in Each Channel o Which Price Points Drive the Most Lift while still Profitable Validate Retailer Execution Input for Customer P&Ls
- 17. Sales Forecasting AFTER Integrated Key Systems and Automated Data Feeds Provide Sales with Better Forecasting “Start Point” by Pre- Populating Base Forecast from Channel Consumption Trends Better Information for Production Means Orders Ship on Time and Compete!
- 18. Deductions and Chargebacks AFTER Huge Productivity Gains o Matching and Clearing Deductions (Sales Ops) o Establishing Accruals to Fund Future Deductions (Finance) o Fewer “Spending Surprises” Decline in Deduction Balance More $ to Re-Deploy to Future Programs to Drive Revenue
- 19. Trade Spend is No Longer Simply the Cost of Doing Business. It is a Strategic & Controllable Expense Allocated by Us according to Our Business Strategy.
- 20. Let’s Take Some Questions!
- 21. Next Up In The “CPG Online Learning Series”
- 22. Thank You & Get Social With TradeInsight • Follow us on Twitter: @Tradeinsight • Join our LinkedIn Group: TPM - Secret to Success • Like us on Facebook