A guide to trade promotion management software for CPG companies

Learn about the importance of trade promotion management software in this comprehensive guide to nimbly react to changing conditions.

For decades, CPG companies have struggled to drive efficiency and leverage the right tools in trade promotion processes – tools that often don’t produce the required results. If your team still depends on Excel to manage, track and analyze trade spend, you probably know this process is outdated and siloed, but how do you choose the best fit among the solutions available?

With the accelerated rate of change occurring in the marketplace today, it’s more important than ever to migrate to a trade promotion management software that allows you to react nimbly and provide the analytics at the levels you need when you need them.

What is Trade Promotion Management?

Trade promotion management (TPM) in the CPG industry describes the process of budgeting, planning, and reconciling a company's trade spending, with the aim of driving sales and profitability while increasing the productivity of sales and finance personnel.

What can the right TPM solution do for your business? 

The use of the right TPM solution can help you manage all your complex distributor relationships, trade arrangements, and reconciliations. This will help you increase your efficiency to achieve better results and boost your ROI. The right TPM solution will do the following for your business:

       Spend less time on manual work

The right TPM solution generates accurate sales and spend forecasts, helps you manage your monthly budget and accrual process, and is simple and easy for your sales team to use. 

You want a solution that does the heavy lifting for you, providing granular insights without working at a granular level. You want your team spending less time inputting data and more time taking action on intelligence. 

When your team isn’t tied to spreadsheets and manually inputting and extracting data across different systems, they’ll spend less time tied to their desks and more time acting on the data and more importantly – more time selling to customers.

       Stay competitive and agile

Plans change, often. You need a system that enables users to change, replan and re-roll forecasts quickly and align on one source of truth across all stakeholders - sales, trade development, finance, and revenue growth management. 

       Plan for the future

At some point, your organization will want to look beyond TPM. Whether TPO and RGM are in your plan immediately or somewhere down the road, make sure you are implementing a solution suite that works together. 

Your RGM functions are related, your solutions should be too – they need to talk to one another. Base and uplift factors feed TPM, but if you change pricing, base projections will also change, affecting your overall trade spend. Managing the interrelationships in one solution suite can help your organization be nimbler and make smarter decisions. You should ensure your TPM can grow with your organization.

Selecting a Trade Promotion Management Software

A well-planned and executed trade promotion strategy helps facilitate an increase in both sales and customer loyalty. That’s why it’s important to find a solution that makes it easy for your brand to drive growth and systematically manage, adjust, and optimize your promotions, key components of an ideal trade promotion management solution are detailed below:

       Fully transparent account planning and budgeting

To ensure convergence between sales, marketing, and finance, a TPM solution should provide cross-functional visibility into promotions, account plans, budgets, post-promotion analytics, and account and company P&Ls. This will ensure all parties are operating with the same information and are aligned on budgets and forecasts.

It’s best to opt for a solution that has an intuitive, but powerful UI to make it easy for all teams to access and onboard quickly and for ease of collaboration on an ongoing basis. Look for capabilities within the system that provide shortcuts for the user, such as single and multi-promotion cloning and annual plan cloning. This will ensure that you spend less time inputting and more time analyzing and improving plans

Make sure the planning capabilities accommodate your account structure. Do you need indirect planning? Advanced distributor model? Can you aggregate your planning accounts into the needed reporting structure? 

Approval processes and workflows should be easily configurable. In general, systems with high levels of configuration capability (as opposed to custom coding) are more sustainable and affordable in the long term.

If you have global needs, consider a system with ease of enabling multiple languages and currency capabilities without having to implement separate instances by country.

       Deduction management 

Settling deductions is a labor-intensive process, so a solution that incorporates auto-settlements functionality will free your AR team to tackle the exceptions and decrease expenditures on invalid deductions.

A quick and easy UI for approvals as well as for handling manual settlements is vital to reduce deduction aging and improve validation rates. In-App collaboration between finance and sales will smooth and hasten the communication process to get questions answered.

       Consumption and shipment forecasting

Your account planning should also provide both promotional and non-promotional volume for a complete consumption plan, preferably with statistically modeled base and uplift factors. You’ll need to be able to lag and modify the consumption forecast to produce an accurate shipment forecast. The ability to report, side by side, on planned sales and spend, shipment forecast, and actuals is vital.


TPM systems are data-hungry, be sure to work with a partner that can help you integrate and harmonize the necessary data sources to ensure a strong foundation. An in-house data science team is best to provide base and uplift factors that are truly predictive and make recommendations on filling gaps in data sources and quality.

       Funding commitment and accruals

TPM solutions should allow the user to make financial commitments at the promotion level. This allows the system to take the burden of spreading the liability to the granular level (products, accounts, and weeks) and provide a view of liability at any level of the account and product hierarchy. 

       Intuitive reports and dashboards

Your TPM solution should provide you with clear and actionable insights. This should include reports geared towards each function; finance, sales, and management, with key KPIs related to promotion performance, spend efficiency, trade promotion effectiveness, accruals and deduction aging, gross to net financials, etc. 

Visual dashboards will help your team react quickly to see what’s working and what isn’t, so you can adjust accordingly to drive positive outcomes. 

Onboarding, change management, and ongoing support

Your TPM solution provider should have separate technical support and customer service teams, often called customer success. The customer success teams should be staffed with CPG industry professionals who understand both the solution and the business process to ensure success in onboarding, and change management and be trusted advisors as you advance the use of the solution over time.

The future of Trade Promotion Management 

In the last few years, trade promotion management software vendors have made great strides in advancing their offerings. However, not all of these tools are created equal, it is important to select a vendor that checks the boxes on the most important requirements for your organization Just as important, make sure that you work with a vendor who will continue to innovate and enable your organization to move on to continuously better revenue growth management capabilities. 

You will want a vendor with in-house artificial intelligence and machine learning capabilities,  the future of trade promotion management and RGM. Machine learning is the driving force behind using historical data to make accurate predictions for future promotions. It falls under the umbrella of artificial intelligence (AI), which uses predictive patterns to help you enhance the functions of your promotions, like automating forecasting of inventory needs and optimizing the supply chain. 

Both technologies can ultimately help you improve timing, tracking, and other areas of investment. The result is a greater ability for your team to accurately allocate funds to improve your ROI, and quickly react to today’s changing economy. Even if you aren’t ready for advanced capabilities, you will want to ensure that the vendor you work with can employ them for you in the future.

Make sure the trade promotion management vendor you choose can:

  • Illustrate their modeling capabilities and show how users can see, validate and interact with the information
  • Have strong visualizations attached to the intelligence that directs users to action
  • Has models that are automatically updated based on available actuals, at intervals that make sense
  • Has strong adoption processes and support personnel to ensure your organization maximizes the return on investment in all technologies.

Get Ready-to-use Trade Promotion Intelligence at your Fingertips

Meet CPGvision: the best-in-class fully connected and integrated RGM solution suite for Consumer-Packaged Goods, built on the Salesforce platform. With the most advanced functionality in the industry, CPGvision equips you with real-life problem-solving applications for TPM, TPO, and RGM. 

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. Get in touch with us today to learn more.

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