White paper: Comprehensive Trade Management (PDF) - Oracle

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consolidated process, with combination of all functions detailed in the functional pillars shown on page 9 is the definition of comprehensive trade management in particular and integrated sales & marketing in general. #3: Capture and harmonize disparate demand signals Consumer goods companies are swamped with data - both internal as well as external. Manufacturers must deal with an ever increasing number of sources, from outbound shipments to syndicated market data to store level consumption data. The first step is to bring all of that data into one single source of intelligence. Multiple data sources, which are not aligned, synchronized, integrated or timely, hinder trade planning and management. Diverse data sources also create conflicting reports, putting data quality (accuracy and breadth) in question. The next major challenge is to mine and transform the data to form the base of knowledge and intelligence that enables more effective and efficient management of the consumer demand signals. Manufacturers who master these signals can monitor and modify ongoing events, conduct timely pre and post event analysis, and plan future events with greater precision. #4: Improve account planning and retail execution The ability to transmit marketing and promotion campaigns to actionable in-store performance continues to be a challenge in developed markets and almost an impossible task in developing geographies. Today, most manufacturers today rely upon a combination of spreadsheets and one or more data warehouses to plan and analyze their trade coverage resulting in: • Difficulty aggregating account plans or creating rolling estimates • Limited scenario modeling capabilities • Lack of tools and software conducive for mobile use, joint retailer planning, or sales productivity Integrated business planning requires a more comprehensive platform to combine the insights of the baseline demand plan with the effect of promotion through the sales & operations planning 12
process. Sales executives today need to know both the baseline and lift to understand the incremental growth necessary to achieve the desired ROI. Retail execution is also not easily managed. Manufacturers face challenges in planning and executing at store level, including sales and merchandiser coverage, routing, order and asset management. Consolidating and tracking retail compliance on ads, display, shelf space, assortment and price is difficult. Limited scorecard capabilities reduce manufacturers’ ability to evaluate retail performance and profitability. The intent of Comprehensive Trade Management is not only to be more strategic, but also to leverage a growing wealth of point of sale data that enables more alignment between individual tactical decision making by the rep and the store buyer. Goals and objectives vary with so much more regularity, depending upon the combined environments of channel and supplier that the consumer-centric model must enable a better response to the marketplace demands. #5: Transition promotion planning from an art to a science Promotion plans are still too often the result of guesswork or inertia (minor revisions to last year’s plan). 74% of planned trade expenditures are based on history, perpetuating poor historical performance. 11 Data driven analytical models are already more reliable than traditional methods of estimating performance under most conditions, and more importantly, they make it possible to plan hundreds of localized promotions that would be beyond the capacity of manual approaches. What is often missing is the capability to generate insightful and appropriate decision making power without the stress, time and pain required in today’s analytical processes. The problem is complex, compounded and confounding. The primary post event measure is still sales volume, not profitability or ROI. Of 52% of companies that measure post event performance, only 48% measure ROI 12 Analytics can help with promotion evaluation as well. Lack of analytics contributes to over-spending of trade budgets, misallocation of marketing resources, and inaccurate financial reporting. The problem most vendors have struggled with is the dynamic effect that environmental conditions (e.g. seasonality, weather, competitive deals, etc.) will have on the pre and post evaluation of performance. What is required is a sound attributebased statistical science that takes the pure historical facts and 11 Consumer Goods Technology/AMR Research “2009 Sales and Marketing Report,” June, 2009 12 Ibid 13
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Page 3 and 4: Introduction Manufacturers of consu
Page 5 and 6: etailers who must cater to them in
Page 7 and 8: growth up 1% in the second half of
Page 9 and 10: Trade Management Challenges There a
Page 11: o o Setting IT budget priority that
Page 15 and 16: How the Process Works A comprehensi
Page 17 and 18: The features, functions and benefit

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