Shoppers love deals and are always on the lookout for them. Two recent studies underscore the importance of trade events to consumers as well as the work that’s still needed to improve them.
According to Accenture’s Perfect Promotion Study, 71% of brand makers have spent more to run trade promotions since The Great Recession. And it seems this was money well spent. More than a quarter of the 350 senior executives from big Consumer Packaged Goods firms interviewed for the study say their return has grown 26% or more as a result.
However, despite improvements, 53% of CPG survey respondents rate their promotions as ‘good, with room to improve a little’; another 25% say ‘fair, with room to improve a lot,’ and 5% call them ‘totally ineffective.’
So, how to improve performance? 54% said predictive analytics are ‘important’ or ‘very important.’ Then 28% say closer collaboration with retailers is “crucial to improving trade promotion initiatives.”
A separate study, The Promotion Collaboration Survey, takes a closer look at this collaboration of trade partners. It calls trade promotion optimization (TPO) “a key opportunity and the next frontier in collaborative activities.”
When asked about collaboration, 100% of retailer participants advocate collaboration (92% call it ‘very important,’ 8% ‘important’), as do 95% of manufacturers (56% ‘very important,’ 39% ‘important’).
This study also suggests these five steps to provide a positive structure for collaboration, which we at The Lempert Report believe are helpful guidelines for retailers and brand makers alike:
Plan collaboration holistically
The retailer sets the rules of engagement
Define key performance indicators and goals
Establish collaboration tools
Continuously measure and adjust