Don’t let fears about promotion pricing, distribution, and merchandising keep you up at night. Follow these four simple solutions to maximize every selling opportunity.
Have you ever agonized over a decision only to make the wrong choice? Have you ever wanted to undo a business mistake? Have you ever wished for a “do over”?
Hindsight is 20/20. While it’s easy to be a Monday morning armchair quarterback, decisions made down on the field are a lot more complicated.
Predicting shopper demand (consumer takeaway) and planning effective promotions can be extremely challenging, especially for a new brand. Most promotions do little to increase sustained sales beyond the promotion and they place an undue strain on your trade management budget. However, this does not need to keep you up at night.
The biggest challenges in natural organic are inconsistent distribution (items with spotty distribution within a retail chain and market), confusing and inconsistent merchandising (items not merchandised the ways consumers shop), and inconsistent pricing and promotions. Solving these problems will help regulate supply and improve sales. Solving these problems will provide a consistent and clear message to support your brand/store. This is the first, and most important, step in building loyal committed shoppers. This will also help you maximize your trade management ROI.
These strategies are at the heart of True Category Management. Effective collaboration between retailers and brands is the key to a successful promotion.
4 simple solutions
1. Stock top selling items across the market, in addition to your niche/specialty products
Shopper perception is key. You want shoppers to see that you have a good selection of their favorite items, in addition to the specialty items that make your store unique. This makes your store more shopper friendly and inviting to consumers. You can then encourage shoppers to “trade up” to your specialty items with creative merchandising and promotions.
2. Sections should be merchandised the way consumers shop the category
Mixing segments within a department or a category can be confusing to shoppers. Make the shopper your number one priority – always. Merchandise products in a way that makes sections easy and friendly to shop. For example, don’t mix broth and soup. Instead place the soups together next to broth in a section where customers can easily compare different brands and flavors of soup.
3. Always stock enough product to support each promotion
Out-of-stocks communicate that you have inventory issues and that you don’t understand consumer demand. Properly plan for and get commitments from brands and distributors to fully support the promotion. Create strategies to ensure that you have ample supply before the promotion begins. Promotions should include items currently in stock at every store within your chain. Items should include a limited stock disclaimer in the ad if you cannot meet shopper demand. Brands need to help manage this!
4. Leverage all your resources and business intelligence (data) to support promotions
While canned reports provide a quick topline overview, custom ad hoc reports can help you grow sustainable sales and help you meet, and even exceed your objectives. Most canned reports don’t address these specific business concerns and they won’t help you properly prepare for promotional increases. You need reports that provide actionable insights when planning a promotion. This is where you might consider hiring a talented category manager. Someone with the necessary skills to drive sales that will help you compete with even the largest and most sophisticated CPG manufacturers.
Hindsight might be 20/20, but following these simple steps will give you a bright future.
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