Choosing the right revenue growth management tool can be a game-changer. Dive into our article to discover the key factors you need to consider!
The current trade promotion execution (TPx) landscape
Is your CPG team struggling to optimize trade promotions in an outdated system that's difficult to use and just feels outright inefficient? Your team is likely, not alone. TPx is a fast-moving scene with evolving software capabilities that didn't exist a few years ago.
According to Gartner, 58% of executives are increasing investment in business intelligence/data analytics (Gartner, 2023 Gartner CIO and Technology Executive Survey - Results for Midsize Enterprises, 2023).
CPG companies that invest wisely in TPx programs to realize process efficiencies and achieve growth opportunities will have a leg up on their competition.
Here we will explore when to know it's time to upgrade, how to choose the right TPx system and discuss maintenance and optimization.
When is it time to ditch and replace your TPx software?
Some signs of when it's time to replace a TPx system are easier to spot than others. However, it's best to proactively recognize the need to upgrade before it becomes an urgent, time-sensitive decision to keep the business running.
A business that is outgrowing a system's capabilities is an obvious sign that you need to move on from your current system.
Growth can come in the form of additional accounts, expanding product portfolios, a more complex go-to-market structure, and increased promotional complexity, to name a few. These could require greater functionality and processing power above and beyond the existing system's capabilities.
Meeting these growing needs will ensure that a system can stay within performance expectations. We all dread opening that one computer application that we must use, but the application consistently leads us to frustration because it isn't accomplishing our needs.
Which system comes to mind for you? Don't let the answer be your company's trade promotion system.
Red flags which could generate user frustration can be spotted even before users voice complaints. Some of these red flags may include:
- An outdated and tedious user interface that requires a lot of clicks for simple functions
- System processors struggle to keep up with user demands
- Trade promotion managers struggle to understand why promotional performance is declining
- The finance team cannot easily and/or accurately forecast liability accruals
- A time-consuming and disorganized problem-solving process to assist users
- Slow and increasing customer support response times with the system provider
- Key functions need to be completed outside of the system
Another vital sign that it's time to upgrade your system is when data processing and insights become cumbersome or outright inaccurate.
For example, let's say trade managers are analyzing promotional profitability, but the system misallocates trade spending amongst items included in an event. This causes an immediate financial impact on tracking current budgets, and event recaps will misrepresent the actual performance. Even worse, drawing conclusions from this inaccurate data will negatively impact current and future decision-making.
In short, you'll know it's time to upgrade when a new system's value outweighs the cons of staying with your current setup. Reliable capabilities, advanced promotional management, and a better user experience can outweigh the challenges of rolling out a new system.
After determining your need to move on from your current system, you must choose the correct solution for your needs.
How to choose the right TPx solution for your CPG company
Understanding the signs saying it's time to move on will help you choose a new solution.
First, map out current capabilities and identify performance gaps - a good vendor can help you assess your “as-is” state, relative to your “to-be” goals. Then, determine the features in a new system that will improve these shortfalls.
In contrast to the previously discussed red flags, look at features that will increase user productivity here.
Next, explore what's possible in advanced TPx systems.
New capabilities, such as price elasticity insights driven by artificial intelligence, have the potential to unlock actionable insights for your teams. Prioritize new capabilities based on need and relevance to your business.
Breaking down silos between leadership, sales and RGM professionals, and other end users is crucial early in this exploratory process.
Gartner has called out that investment decision-makers may not report to the IT department. Input from team members at all levels of the decision-making process will help gain investment alignment and determine the best new solution for your company.
Here's how to maintain and optimize your new system
It's an accomplishment to choose and roll out a new system. But you still need to finish! Maintaining and optimizing your new system is essential for operational success and generating business value.
Three actions to include in your TPM maintenance strategy are:
- Determine a set of KPIs to measure ongoing success. These KPIs should touch on the new capabilities and features which initially influenced your system choice. Examples could include utilization stats or the trends of an account's average event ROI over time.
- Define an ongoing growth plan including data analysis and operational performance reviews on a regular cadence. The KPI metrics determined in point #1 will help shape these reviews and optimization areas.
- Search out and welcome employee feedback to understand which user challenges remain. This is where including cross-functional team members from the beginning of the upgrading process will continue to pay off. These established relationships will foster informal conversations with users across all levels of the organization and aid in user adoption.
These actions will highlight improvement areas via quantitative (KPIs) and qualitative data (conversational feedback). Include both when recapping efficiencies driven by your new TPx solution. This will create a holistic view to share progress with the investment decision-makers, who may need to become more familiar with the details of the system.
Continuing to highlight examples of system success will build trust well in advance of more investment decisions further down the road.
In the same report, Gartner also states that the most common objective of digital investment over the last two years is "Improve Operational Excellence". Taking these steps and investing in a quality system and thorough review process within your TPM maintenance strategy will improve operational excellence across the organization.
We can help you get started
Meet CPGvision –an advanced TPx solution. Driven by Artificial Intelligence and Scenario Planning, CPGvision leverages powerful ML and AI to drive the accurate predictive analytics you need behind all your TPx functions.
Your success is our success. CPGvision proudly provides a dedicated customer success team staffed with CPG industry professionals. Regardless of where you are in your RGM journey, you’ll be fully equipped with the solutions you need for profitable revenue growth. Contact us today to get started.
Check out this article for more details on implementing a new system.