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Trade Promotion Management 2019: New Tech for Old Tricks

  • Articles
  • Consumer Goods Technology
  • September 2019

Read the full article on Consumer Goods Technology.

“The trade promotion practice often gets a bad rap for continuing to apply outdated strategies and outmoded technologies to one of the most critical business functions for consumer goods organizations. But it’s not from lack of desire to change.

Many large, established CPGs are stuck in legacy systems in which they’ve overinvested; internal policies and politics can oftentimes keep them from changing and evolving with the more advanced technology now available.

“We’re seeing a lot more granularity in decision making,” says David Moran, co-founder of solution provider Eversight. “For leading CPGs, gone are the days of a few PowerPoint slides from headquarters instructing the field on the types of offers that should be going into the market. We’re now observing higher levels of precision at, for example, the individual customer and event level, where AI engines are systematically determining which offers to run. And we’re seeing a radical change in adoption.”

Artificial intelligence and machine learning are gaining the most attention as the panacea for just about every business need. But what about utilizing these new tools for TPM?

Machine learning is an important component powering Eversight’s experimentation algorithms, explains Moran. “Without ML, we wouldn’t be able to efficiently automate everything, from what new promotions to test, how to design experiments, test-stopping criteria and winner selection, etc.”

There even have been some early efforts to move trade planning to something that’s more “programmatic” in determining investments, similar to what’s taken place in the world of digital media buying. “This trend is mirrored by Amazon’s ‘Hands Off the Wheel’ initiatives [a move toward automated price negotiation and demand forecasting] and shows promise for a future world of integrated trade spending and loyalty that could be profoundly more effective,” he suggests.

“Trade spending will be managed through an integrated content management system that blends personalization, A/B testing and automation to allow a much more segmented view of personalized promotions,” suggests Eversight’s Moran. “It will become ‘programmatic’ just like marketing has, and funding investments will dynamically move between ‘mass’ and ‘personalized’ offers.””

 

Read more on the evolution of technology in the Trade Promotions Management/Trade Promotions Optimization space and Eversight’s presence from Consumer Goods Technology.