How CPG Companies Optimize Trade Promotions and Media Spend with Decision Intelligence

We are living in the age of influencers. The rise of social selling via TikTok, Facebook, Snapchat, and Instagram has dramatically changed demand in major sectors of the consumer packaged goods (CPG) industry. A handful of TikTok videos about a single product – from Maybelline’s Sky High mascara to Bissell’s Little Green Machine carpet cleaner – can fuel a rapid spike in demand, emptying store shelves and distribution centers.

However, many CPG companies are still using traditional trade promotion methods to drive sales in physical and online retail. These tools can’t keep pace with ever-changing market conditions and customer expectations.

In order to deliver on brand promises, it’s critical for your company to identify and address trade promotion and media spend challenges, then find the best path to address them. With Decision Intelligence, it’s possible to accelerate digital transformation of go-to-market strategies, trade promotions, and media spending to balance consumer demands and business needs. This technology is already helping CPG companies optimize their sales and marketing efforts by providing greater visibility into the business impact from different trade and media strategies.

Trade Promotion Management Challenges

The first obstacle facing CPG companies is a lack of transparency and visibility into processes. In many cases, retailers lack the ability to connect the dots between promotions and sales, which makes it more difficult to create future promotion plans, or to determine strategies that will yield the highest profits and ROI. Legacy systems, point solutions, siloed business processes, and difficulty in analyzing vast amounts of data all make trade promotion decisions more complex and difficult to manage – and that’s before you factor in the smaller windows of opportunity to make those decisions in the age of TikTok.

Maintaining or increasing brand loyalty is also a challenge, especially in the current economic climate. Shifts in buying habits during the Covid-19 pandemic prompted many customers to begin switching brands, with McKinsey & Co. reporting that “36 percent of consumers have tried a new product brand” while 25 percent sought out new private-label brands.

Companies recognize the power of social media in generating customer loyalty and activation, with Nasdaq reporting that over 30% of today’s product searches begin on social platforms. Yet the majority of brands are competing for consumers’ attention in the same spaces, with 74% of global digital ad spend spread across Google, Meta, and Amazon.

Improving Outcomes by Increasing Visibility

Decision Intelligence dramatically improves transparency into operations and enables CPG leaders to make better decisions at scale, and across the portfolio. Built on artificial intelligence (AI) and machine learning (ML), a Decision Intelligence platform understands your business, makes recommendations, writes back to source systems autonomously, and learns to improve decision making across the entire enterprise.

A Decision Intelligence platform harmonizes data across the ecosystem, from manufacturing to point of sale – including taking into account digital marketing spend from third-party data sources and analyzing it against promotion management activities. When this information is connected to supply chain data, it enables decision makers to determine whether current marketing or media spend activities are effective, and which adjustments need to be made to improve them, in near-real-time.

Finally, the platform also learns from the outcomes of decisions, writing the results back into the systems of record and updating the data model to improve future recommendations. It’s also possible to automate these adjustments based on business rules – for instance, automatically reallocating media spend to different campaigns, or making adjustments to the supply chain based on current performance of a media campaign.

Ready for the Future

Aera Decision Cloud™ gives CPG companies the visibility, data harmonization, and insights to remain agile in today’s fast-moving consumer environment.

One global CPG company relies on Aera Decision Cloud’s Trade Promotion and Media Optimization Skills to determine whether they should extend or cut short specific media activities, based on real-time recommendations and forecasts from the platform. By providing the recommendations needed to make data-driven decisions at the moment of maximum impact, Aera Decision Cloud helps this company enable better agility and visibility throughout the enterprise – not only improving inventory management, but reducing overall costs and, ultimately, creating a more efficient and sustainable CPG supply chain.

Learn more about how your company can use Decision Intelligence to improve trade promotion and media spend – watch the on-demand recording of our recent webinar, “Next Generation Trade Promotion Management and Media Spend Optimization.”