TPx’s Crucial Role in Simplifying User Experience
With vast quantities of information at their fingertips, data teams are working harder than ever to see the forest for the trees. An effective analytics strategy cannot happen without transparency, solid metrics, and understanding of key objectives. When looking to simplify enterprise-wide processes, trade promotion technology forms a major part of this puzzle.
Interest in combining TPx and advanced analytics is gaining momentum among CGs. In this conversation with CGT, Joel Cartwright, industry principal at Vistex discusses how CGs are leveraging TPM technology to match evolving customer expectations and shoring up their options when it comes to forecasting demand, optimizing supply chain, and mitigating risk.
CGT: How has trade promotion technology evolved to provide more value for consumer goods manufacturers?
Joel Cartwright: TPM technology has evolved focused on a simplified user experience: easy plug-and-play integration to peripheral systems, such as CRM platforms, demand planning systems, and supply chain systems.
In addition, the technology has evolved in the form of consolidation of processes into a single offering, optimizing planning, multichannel go-to-market planning, and execution, and eliminating multiple platforms and improving digitalization of the IT ecosystem. This is the route cause of a current industry focus on “digitalization” in which gap fill processes within TPM planning/execution/analysis that are currently done manually or in Excel.
As part of the revenue growth management push, TPM users realize that automation of these processes provides a qualitative value add through the aforementioned IT ecosystems — automation of processes such as configurable exception alert notifications, ad hoc reporting configuration based on a described KPI need, or automated claim validation in settlement processing.
CGT: How have customer expectations changed to make it more of a necessity?
Cartwright: Customer expectations have evolved into requiring a quick return on investment, which translates to “out of the box” purpose built applications that quickly integrate to existing peripheral systems. In addition, data availability and migration to cloud have set the customer expectations of a software as a service model.
Customers are expecting a true SaaS offering very similar look and feel as if they are shopping on Amazon or working in Salesforce. The idea is to eliminate redundant data entry, utilize click and drag dynamic calendars when doing plan creation or modification, and including dynamic fields that pre-populate data based on an initial selection early in the work process.
CGT: How can advanced analytics help CGs unlock more value from their TPx?
Cartwright: Consumer goods manufacturers are starting to take advanced analytics to the next level and applying the TPx and integrating it to their revenue growth management. Taking the TPx incremental volume forecast of their merchandising and adjusting their demand forecast based on the TPx forecast. This optimizes the supply chain, eliminating out of stock, and optimizing inventory. This is the key to revenue growth management, the ability to optimize a manufacturer's entire sales, marketing, and supply chain processes that eliminate waste and drive productivity.
CGT: What are some best practices and benchmarks teams should strive for?
Cartwright: Forecast accuracy: CPG manufacturers year over year miss the mark on forecasting volume, which is a key driver in profitability and revenue growth management. A simplistic approach of comparing forecasts to actuals, and setting a performance metric to work on improving accuracy. CPG manufacturers should strive for a +/- 3% to 5% within actual volume.
Believe it or not, another best practice that goes unused is risk analysis and course corrections to a plan, as TPM clients fail to load simple sales and budget objectives which field TPM clients don’t take the time to put into systems as a target, and if they do there is no periodic review. Teams should also establish a monthly or quarterly cadence of analyzing how the plan is performing against the objectives to mitigate risk and close gaps to plan.
