Trade promotion solutions can manage your allowances, discounts, and calculate a plethora of KPI measures. Many can give you both proforma and historical P&Ls. However, one of the most basic and simple attributes to track is often missing… the goal.
Adding a stated goal to your trade promotion is easy. Just add a note! You don’t need a sophisticated trade promotion solution to document your goal. If you are still using Excel, add a column and state your goal.
So what do I mean about a stated goal for your trade promotions? Here are some examples:
|Example trade promotion goals||Comment|
|Create trial usage||Store sampling, along with promotions that that entice first-time users|
|Build Market share||This goal tells the approver you are less concerned about profit, and more focused on building brand sales at the expense of your competition.|
|Generate extra sales for the brand||This type of promotion is focused on incremental results, and hopefully incremental consumption, not just loading.|
|Build category sales||This goal tells the approver and the retailer that you’re looking at the big picture, not just your own items and brands.|
|Meet competition||This is a common goal, to address specific short-term competitive threats that are creating head-winds for your brand.|
|Build store traffic||Sometimes loss-leaders are used to build store traffic, or traffic in an aisle or section.|
|Gain more facings and/or sell your product in more stores||These are new distribution events, also called slotting|
|Sell all of the product that’s near expiration date||This goal can explain deep discounts and special terms typically not offered by your organization.|
|Maintain||This tells the approver you don’t expect much from the promotion, but you are running this to maintain visibility with the retailer and the buyer.|
As an approver, how can you evaluate a promotion if you don’t have a stated goal or objective? Even if you are not approving someone else’s trade promotions, this type of information is helpful when deciding which events to run again next year. It’s easy to save time and copy last year’s promotion to next year. With so many trade promotions, having stated goals for each promotion helps you remember why you ran the event, and copy the correct promotion to next year’s trade calendar.
With all the technology we use today to manage trade promotions, don’t forget this one simple but important task that we often forget: Add a note to your promotion and document your promotion’s goal.
CG Squared, Inc.