POI Pulse February 15, 2016

POI Pulse February 15, 2016 PUBLISHED BY PROMOTION OPTIMIZATION INSTITUTE

Trends & Developments

Mondelez: Institutionalizing Approach to Cost Mgt.
Source: The Drum February 4, 2016)

Mondelez’s attempts to foster a more cost-focused culture among its marketers are showing signs of paying off. The snack maker hired Accenture in 2014 to introduce a severe cost-control budgeting strategy in a bid to deliver $3bn in gross productivity savings over three years. Brand managers now adopt zero-based budgeting. Learn more

H-E-B Div President Discusses Model for Success
Source: (Houston News February 5, 2016)

“At H-E-B, we seek to be the best retailer. More than that though and what makes H-E-B a little bit different is we work to invest in three things – reinvest in our customers so we can have the lowest prices possible, we invest in our partners pay and benefits and we invest in our communities.” Learn more

The agenda will once again be advanced, so register now to attend, as the POI April 2015 Summit was sold out! More than 300 CPG Manufacturers and Retailers will join us in Chicago–

Teams taking advantage of early registration include:

Smithfield Foods, Wells Enterprises, DPSG, Constellation Brands, American Licorice, Walgreen’s, Schreiber Foods, McCain Foods, Bimbo Bakeries, Mrs. T’s, General Mills, Energizer, Bellisio Foods, Young’s Markets, Unilever, Procter & Gamble, Morton Salt, Prestige Brands, PepsiCo, JM Smucker, Mars, EJ Gallo, MillerCoors, Shopko, Edgewell, Wrigley, Ahold USA, Mondelez, Mars, PepsiCo, Starbucks, Pinnacle Foods,Coca-Cola, Food Lion, Kimberly Clark, Johnson & Johnson, Perfetti Van Melle, Kraft Heinz, Hormel, Clorox, Tyson, Kellogg’s, 7-Eleven, JM Smucker, Church & Dwight, Busch Bros.,Topco, Keurig Green Mountain, Jarden, Musco Family Olive, Windsor Foods, Ainsworth Pet Nutrition, Del Monte, Hy-Vee Stores, Red Bull, Rich Products, Vitamin Shoppe, Campbell Soup, and many others. For your invitation, reach me today at mkantor@p-o-i.org

Q&A – Southeastern Grocers CEO Ian McLeod
Source: (Supermarket News February 4, 2016)

Southeastern Grocers, Ian McLeod has embarked on a major efficiency program helping to fund a $70 million pricing investment; rallied merchants and operators around new products and higher standards; and most recently, brought a store back from the dead. But he’s only getting started. Learn more

Seventh Generation Powers Intergated Business Planning with Exceedra
Source: (Press Release February 5, 2016)

Pete Alberse, Chief Customer Officer, comments, “Exceedra’s capabilities, experience, and people stand out. Their integrated solution will help put SVG in a better position to manage our future growth.” Chris Rice, VP Sales and Marketing, Exceedra Inc, comments “We’re excited to have Seventh Generation join our growing client

community. The SVG team was well prepared which made it easy for them to understand our benefits and key differences from systems, approach, experience, and people.” Learn more

POI Global Summit is Set for Brussels, Belgium

Source: (POI 10-11, May 2016)

Whole Foods Works to Reduce Costs
Source: (4 Traders February 14, 2015

Whole Foods is shifting more responsibility for buying packaged foods, detergents and other nonperishable items for the more than 430 stores to its Austin, Texas, headquarters. It is deploying software to simplify labor-intensive tasks like scheduling staff and replenishing shelves. To lure shoppers, Whole Foods also plans to offer more discounts. Learn more

General Mills Celebrates 150th Anniversary
Source: (Grocery HQ February 11, 2016)

General Mills’ strategies for “the next big thing” include partnering with emerging food brands and entrepreneurs to create new and on-trend breakthrough foods through the company’s new business development and venturing unit, 301 Inc., providing knowledge, expertise and access to capital. Learn more

The agenda will include eCommerce, Revenue Managements Strategies and once again be advanced. Register now to attend, as the POI April 2015 Summit was sold out! More than 300 CPG Manufacturers and Retailers will join us in Chicago–

Teams taking advantage of early registration include:

Nestle, Natrol, Organic Valley, McKee Foods, Smithfield Foods, Wells Enterprises, DPSG, Constellation Brands, American Licorice, Walgreen’s, Schreiber Foods, McCain Foods, Bimbo Bakeries, Mrs. T’s, General Mills, Energizer, Bellisio Foods, Young’s Markets, Unilever, Procter & Gamble, Morton Salt, Prestige Brands, PepsiCo, JM Smucker, Mars, EJ Gallo, MillerCoors, Shopko, Edgewell, Wrigley, Ahold USA, Mondelez, Mars, PepsiCo, Starbucks, Pinnacle Foods,Coca-Cola, Food Lion, Kimberly Clark, Johnson & Johnson, Perfetti Van Melle, Kraft Heinz, Hormel, Clorox, Tyson, Kellogg’s, 7-Eleven, JM Smucker, Church & Dwight, Busch Bros.,Topco, Keurig Green Mountain, Jarden, Musco Family Olive, Windsor Foods, Ainsworth Pet Nutrition, Del Monte, Hy-Vee Stores, Red Bull, Rich Products, Vitamin Shoppe, Campbell Soup, and many others. For your invitation, reach me today at mkantor@p-o-i.org

Cracking the Code on Your Customers’ Behavior
Source: (Fortune February 14, 2016)

This “intent / behavior gap” explains why our old attempts at change changing consumer behavior – fancier marketing campaigns and periodic price cuts – all too often lead to such modest results. One organization that figured how to tap this latent demand is PetSmart Charities, the not-for-profit arm of PetSmart, the pet supply retailer. Learn more

POI Global Summit is Set for Brussels, Belgium

Source: (POI 10-11, May 2016)

View the preliminary agenda for POI Brussels. Building on the success of the inaugural POI Global Summit in Geneva, CH on 12-13, May 2015 leading global companies like Henkel and Coca-Cola are advancing their understanding, and associated benefits of Joint Business Planning, Retail Execution and the components of successful promotion collaboration. register now!

Inside PepsiCo’s Successful Snacks Strategy
Source: (Food Bus News Feb 11, 16)

“The objective was to get a package that smaller households would find attractive as the primary promotional package,” said Hugh Johnston, vice-chairman and CFO. “In that regard, the strategy has actually been quite successful, and I think gotten our volume rebased in a good spot from the standpoint of how we’re managing the Lay’s business. Learn more

Enroll Today and Become Certified as a Collaborative Marketer w/ POI at Saint Joseph’s University
Source: (POI-Next Orientation is June 16-17, 2016)

During this 16-week self directed program, expert faculty expose participants to the key management levers that drive organizational success. The program begins by exploring how organizations develop and implement strategy. Then, core functional areas of business are explored – from sales to marketing, to supply chain and finance -teaching candidates a solid understanding of each function and how it contributes to trading partner collaboration success. Learn more and enroll today

How Instacart’s Pricing Changes Impact Retailers
Source: (Supermarket News February 9, 2016)

To better understand Instacart’s markup, in September 2015, Profitero collected 60 products’ in-store prices at Costco stores across 10 zip codes in 5 metropolitan areas: New York, Atlanta, Chicago, Los Angeles and Seattle. On average, Instacart charged a 23% markup over store prices on the same items, 8 percentage points higher than the 15% quoted. Learn more

View the Full Lineup of POI 5 Leading Events for 2016
Please take a look at what is next on the full POI Summit schedule on our upcoming events page. Save the dates, and advise your cross-functional team members.

Sainsbury’s Ditches Multi-buy Promotions
Source: (The Drum February 11, 2016)

Multi-buy promotions will soon be no more at Sainsbury’s stores following its decision to give them the boot by the summer in favor of pushing lower regular prices. Since last March, it has culled more than 50 per cent of multi-buy promotions from its shelves.

Learn more

Applying Capabilities to Enterprise Architecture Planning – CAP
Source: (Strategy& Business February 2016)

Unlike most enterprise architecture projects, Capabilities Architecture Planning (CAP) starts with strategy. It marshals digital technology to develop the company’s capabilities – the combination of processes, tools, knowledge, skills, and organization – that give it a competitive advantage. Learn more

POI Perspective

Continuing on the theme from last week…There is a serious shortfall in analytical capabilities. Excerpt from the 2016 POI Report: The State of TPx and Retail Execution for Global Consumer Goods and Retail

Dale Hagemeyer, Partner, POI

Now, switching over to the retail execution context, we also see signs of the analytical shortfall. Keep in mind that survey respondents were speaking of both TPx and retail execution with their response about being too transactional and not sufficiently analytical. Since retail execution people are primarily focused on being in the store environment, it stands to reason that they need the ability to do the right thing at the right moment in time. However, it doesn’t appear to be the case, as the following survey responses indicate.

Your retail execution solution provides the analytical capabilities required to make appropriate decisions at the store level?

At least half find themselves in this situation. And if you agree that “somewhat” doesn’t constitute a competitive advantage, then a full 89% are not sufficiently empowered for in-the-moment decisions. Small wonder that at least a third of respondents (reference back to second chart) aren’t satisfied with their ability to execute at the store level. We are actually surprised that the number isn’t higher, given that the majority aren’t enabled to make “appropriate” decisions at the store level. This leaves them with no option but to either guess at what to do or to be purely transactional.

Furthermore, relative to internal collaboration, we find that office-based users are only slightly better off in their ability to make appropriate decisions at the store level. When analyzing responses to the statement: “Your retail execution solution provides the analytical capabilities required to make appropriate decisions for office-based users.” Still, about half just can’t do it at all. And if “somewhat” is still pretty much transactional, then only 20% are consistently able to do the right thing and drive value at retail.

For the sake of consistency, we will show the responses for the importance of being able to see the business in an insightful way. The results clearly show that CG companies want insight and the ability to make decisions so that their field people are not mere automatons. However, either they have/are choosing inadequate, transactional solutions, or else they don’t recognize this analytical shortfall.

How important is the ability of analytics to show an aspect of the business in an insightful way or KPI” in the retail execution area?

What we find interesting here is that 8% actually do place a low priority on the insights capability, so there are indeed those who want their retail execution people to just focus on a set of transactions. Nevertheless, we continue to believe that proper analytics can be a differentiator.

Learn more and reach Mike Kantor to access the complete report, and engage with the POI team. mkantor@p-o-i.org,

Sincerely,

Michael Kantor

CEO & Founder
Promotion Optimization Institute, LLC
mkantor@p-o-i.org

www.POInstitute.com

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