How often have you seen a promotional brief that contains a list of far too many objectives? A lot of the time we repeat promotions or trade investments. It is both human nature as well as a case of ‘why fix it, if it isn’t broken’. However it may well be that we are not investing effectively because we haven’t started with a blank piece of paper and sense checked that we are using the most effective tactics.
If we take a step back each time we embark on a promotion with our customer’s shoppers, to think about what it is that we want to achieve, selecting the right tactics, we make it much more probable that we will achieve our objectives. We also focus on a clear objective, so our promotion performs strongly on our financial objectives, rather than diluting our return on investment across a range of unclear objectives.
It seems so self-evident that we often don’t question what we are doing, since any promotion is bound to have some uplift (customer sales in and shopper sales out) and so we calculate the return on investment and are generally happy with any positive ROI metrics. Time poor, we move onto the next promotion or activity and repeat what we did last time. There is very little incentive to re-examine what we are doing.
We can reduce and optimise our trade spend by selecting the right tactics to achieve our promotional objectives.
We always start with a clear promotional objective before we think about the tactics we might consider, for example:
- If our objective is to increase our brand’s availability the tactics we might deploy are a distribution drive or a focus on zero out of stocks
- If our objective is to drive our brand awareness the tactic we might deploy are a consumer, shopper advertising promotion together with a shopper event, to drive word of mouth advocacy
- If our objective is to increase purchases at the point of purchase the tactic we might deploy is a price promotion, with relevant display and pricing in store.
Always select the right tactics to achieve the right promotional objectives to drive the right return on our trade spend. We will then spend strategically : promoting the right categories, aligned with our media campaigns, aligned with what we know works, increasing visibility and avoiding out of stocks. The right tactic creates a positive category result, alongside our brand building benefit and sales uplift and helps us to invest wisely with our customer.
Can we clearly demonstrate the link between our tactics and our promotional objective?
Next in our ‘Top 10 Tips to Reduce Trade Spend’ series we make sure that we optimise trade spend by monitoring compliance so we reduce spend for non compliance. If you have any questions or comments please get in touch.