Considering that trade spend accounts for almost 25% of the marketing budget for consumer product companies, and 20% of revenue for FMCG companies, it's critical to optimise retail promotional activities and trade spend allocation. And yet, despite this enormous level of investment, most manufacturers and retailers don't optimise their trade spend or even measure their promotional effectiveness. In most cases, the common practice is to take last year’s promotion plans and tweak them without identifying ways to improve or optimise, and at times trying to force old plans to solve new problems.
Due to the inherent complexity of the process, most companies use home-grown spreadsheets and ad-hoc reports for promotion planning and trade spend allocation, resulting in common problems such as:
- Manual handling and manipulation of data from a variety of sources, leading to data integrity issues and substantial time inefficiencies
- Significant time, expertise, and labour required to analyse just a few scenarios and determine their effectiveness, making it impractical to conduct a comprehensive analysis to find a truly optimised plan or allocation
- Inability to generate optimised promotional plans in a way that maximises category growth and product penetration
- Inability to drive volume and margin predictions within markets
- Inability to collect and take advantage of competitor data
- Inability to measure the effectiveness of promotional activities
We can help you address these commonplace problems through Complexica's Promotional Campaign Manager (PCM), which provides robust and easy-to-use planning, analysis, prediction, and optimisation capabilities. Apart from increasing product visibility and raising brand awareness, PCM can help your business grow a category and differentiate a product.
Customer success story: Australian Liquor Marketers
Watch a complimentary video to Chapter 3: Promotional Planning and Pricing of our new book The Rise of Artificial Intelligence:
Complexica's PCM application combines essential features of both Trade Promotion Management (TPM) and Trade Promotion Optimisation (TPO) systems:
For companies wishing to replace the home-grown spreadsheets and automate the labour-intensive processes for data loading and handling, customer planning and budgeting, TPM is usually the starting point. For businesses wishing to strategically manage their trade investments and use what-if scenarios to find optimised promotions, TPO offers an additional level of sophistication.
Depending on business requirements, TPM and TPO components can be deployed together as part of Complexica's Promotional Campaign Manager (PCM) or in isolation. A TPO-only deployment of PCM can extract data (both transactional data as well as promotional slotting boards) from an existing TPM system to perform the necessary what-if analysis and optimisation, and then push back into TPM optimised promotional plans that deliver the right mix category growth and sustainable share.
To explore how Complexica can improve your promotional planning process and optimise trade spend, please contact us