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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• Today’s Presenter is Michael Cross, Product Marketing
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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
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.
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