A GUIDE TO CHOOSING A TPM/TPO PLATFORM
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1 A GUIDE TO CHOOSING A TPM/TPO PLATFORM
2 CONTENTS A Guide to Choosing a TPM/TPO Platform... 1 Overview... 1 Why You Need a TPM/TPO Platform... 1 Ask the Right Questions... 2 Evaluating Features... 2 Choosing the Right TPM/TPO Partner... 4 Conclusion... 4 TPM/TPO Platform Checklist... 5 About T-Pro Solutions... 6 OVERVIEW The consumer packaged goods (CPG) industry is changing at a rapid pace. Consumers are making choices faster and are armed with more information. This means that CPG marketing and sales teams need to keep pace, and it s impossible to do so without a technology tool that provides real-time, actionable insights and intelligence. Trade Promotion Optimization (TPO) software platforms can be effective tools for improving team efficiency and return on investment. These platforms can automate the time-consuming, manual tasks associated with TPO/TPM (trade promotion management), while improving productivity, campaign performance and collaboration. Over the past few years, many TPO platforms have emerged, each offering a different set of product features. Purchasing TPO platforms are a big commitment for any CPG organization, so before you dive in, be sure to thoroughly evaluate each platform in order to make the most of your investment. In this guide, we examine the benefits of TPO tools and identify the key factors to consider and questions to ask in order to choose the right solution for your organization s needs. WHY YOU NEED A TPM/TPO PLATFORM By automating TPO through an enterprise platform, your organization can improve efficiency, productivity and profitability in many ways: Smarter actions Get rid of inaccurate baselines. Break down internal communication barriers so that you can concentrate on customers. Your business will stay current and keep pace with rapid changes in reporting, enhanced analytics and greater insights into customer behavior through reporting and attribution. Implement a real closed loop analysis. Better workflow Spreadsheets are error prone. Day-to-day management of calendars across different user interfaces is 1
3 time-consuming and frustrating. Settlements and deductions need to be handled efficiently, accurately and in a timely fashion. Improved performance A single platform collects and integrates all of your internal and external data variables in one place. This data can then be used to perform modeling and predictive analytics. These insights can be used to inform a larger trade promotion optimization strategy, including how different marketing promotions can work together to improve profits and collaboration. Competitive edge Those organizations that have a TPO solution will be able to outperform their peers who do not. They will be able to build trust by generating more meaningful interactions with their trading partners. Save time to effectively utilize your Team - Current post-promotion event analysis requires a significant amount time to compile key information from 3-4 data sources. Many organizations are spending 20-30% of their trade resource time compiling the information to analyze, which limits the frequency and depth of their analyses. In many cases, organizations can only evaluate their top customers events 1-2 times in a year. ASK THE RIGHT QUESTIONS Choosing a TPO platform requires a comprehensive evaluation, including an assessment of business needs, staff capabilities, management support and financial resources. HERE ARE SOME QUESTIONS TO ASK BEFORE EVALUATING PLATFORMS: What are the goals of this project and how do they match my business objectives? Is too much time spent crunching numbers? Should marketers refocus on more strategic tasks like promotional benchmarks? Will this create an opportunity to increase profits? Lower promotional spend? Increase market share? Are integrated communications needed? How will this differ from my Business Intelligence (BI) solution? Will other departments be willing to give up their spreadsheets? Can we create internal communication channels? Are we ready to be transparent between intelligence silos? What is the downside if we delay the process? What data are we hoping to integrate? Are we hoping to be able to integrate multiple data sets? Do we need real-time updates? Weekly? Monthly? Quarterly? What open API s are available for data exchange? How can we maximize the investment in data subscriptions? Who will control the modeling and validate the data hierarchy? What are the reporting needs? What is our baseline today? What are our customers asking for? How much flexibility do we need? How will we present our findings? Who needs access to the dashboard, in what roles? What about Wall Street/the Board and what they want? How will success be defined and benchmarked? Will we be successful if we do this in a year? Quarter? Months? How much can we save? What do our customers want? What is Best in Class for tracking and reporting results? EVALUATING FEATURES Service levels and price are definitely important when evaluating each platform s features, however you should also consider things like ease of implementation, configured flex reporting capability, cross-channel data integration, and easy development of optimization scenarios. 2
4 EASE OF IMPLEMENTATION. Some TPO solutions take longer to implement than others. Here are some important things to consider: Timeline. A project schedule is imperative to a successful implementation. Ask the vendor for a sample project timeline. There needs to be a lead on the vendor side as well as the client side to make sure the project tasks and overall timeline are on track. Functionality. Match up your key business objectives and needs with the features available for each specific platform. Can this tool accomplish what your organization needs it to do? Enhancement costs. No tool will be perfectly suited for your organization out of the box. Taking that into consideration, what are the average costs for enhancements and customization? Training & Support. A successful implementation relies on training and support. Ask for an outline of the training package along with terms and costs for support. Determine who on your staff will need to be trained right away and down the line. CONFIGURED FLEX REPORTING CAPABILITY. Measurement is central to any TPO/TPM activities. However, the always-present demands of the next program often lead little time to evaluate historical results effectively or accurately. Below are some important platform capabilities to consider. Baseline trends. Identify baselines that are outside thresholds and enable adjustments due to data anomalies or unidentified promotions. Historical and Predictive Lift Indexes. Predictive and historical lift measure access, automated forward buy calculation utilizing Consumption to Purchase Index (CPI), and full manufacturer and retail predictive profit recap. Accurate KPI Analysis in Real-Time. Promotions shipments, spending and POS consumption can be easily aligned in for real-time KPI analysis. What If Planning Scenarios. Detailed calendar view of possible what if planning scenarios to provide the most accurate predictive planning capability utilizing both historical and predictive lift coefficients. CROSS-CHANNEL DATA INTEGRATION. Can we get everyone on the same page across the broader organization to communicate what we re learning from our TPO platforms? Consolidated reporting. Does the platform support the correct tie-in to hierarchical geography and product roll-ups? How is this done? API s? What is the timeframe? Seamless integration. The platform should not require extra steps for data transfers and reconciling multiple reports to get hierarchal reporting that is real-time, accurate and scrubbed. OPTIMIZATION. This can be the difference between the status quo and more impactful solutions Optimized Modeling. Can top down/bottom up optimization be accomplished in the tool? Scenario Planning. How configurable/flexible is the input of various constraints necessary for accurate development of numerous scenario plans? Trends. How easy is it to adjust baselines and lift coefficients based upon a 12-month trend assessment? 3
5 Goal Setting. How easy and intuitive is it to tell the system what the goals of the promotion are and whether or not it is revenue, cost per item, promotional position or a combination. Optimization. Once the goals are set, how rich are the metrics that are available to optimize from? Do they include actionable insights that can be shared with retail partners? Transparency and control. Can the system provide a strong basis and rationale to gain more control of budgets, spend and ultimate truth about profits and margins? CHOOSING THE RIGHT TPM/TPO PARTNER After your organization has identified what features and functionalities are needed (and what would be nice to have), it s time to begin evaluating vendors and make a decision. Define your partner choice. Will you use a committee and formal process? Who will be the final decision maker? Whether you will go through a formal Request for Proposal process or simply evaluate vendors independently, it is important that you communicate clearly the decision to evaluate TPO platforms. Identify and contact vendors. Identify vendors that meet the criteria. Provide the list to the vendors to expedite comparison when evaluating proposals. Schedule Demos. Set up demos for all internal staff members who will be working with the platform. Consider developing an in-depth scripted demo with all of your functional requirements addressed, that all vendors must present from. This offers the team a chance to ask questions and get a better understanding of what it might be like to work with the product. Check references. If possible, consult several customer references. These should be the primary users of the platform, not just the person who signed the contract. Interview non-competitive CPG companies at trade show events to garner candid feedback. Negotiate a contract and timeline. The contract should detail the platform and the service-level agreement. It should also outline how long it will take to implement the platform including training. Uncover any additional fees for consultants, implementation, and future enhancements. CONCLUSION TPO platforms can help make your CPG business more productive and efficient by streamlining workflow, reporting and optimization. They allow the communication you need to manage promotional campaigns across intelligence silos. However, before investing, it is important to assess the business needs and questions for the evaluation process. 4
6 Below is a checklist with the following criteria that are important to consider in your partnering decision. TPM/TPO Platform Checklist TPO PLATFORM VENDOR #1 VENDOR #2 VENDOR #3 COMMENTS WORKFLOW Ease of use Large data handling capabilities Customization Automation Data integration REPORTING Exporting Configuration flexibility Insights Calendar view OPTIMIZATION Testing Goal setting Pricing Transparency and control CROSS-CHANNEL Access and role Consolidation reporting Seamless integration IMPLEMENTATION Cost per user Ongoing monthly costs Training Service fees 5
7 ABOUT T-PRO SOLUTIONS T-Pro Solutions provides CPG clients accurate, real-time information by integrating TPM data into a user-friendly dashboard for planning, forecasting and predictive analytics. T-Pro Analytics is a cloud-based SaaS solution. By combining CPG intelligence silos, clients can optimize promotional ROI in real-time. T-Pro Analytics can be implemented in a few months, is easy to use, and is affordable. T-Pro Solutions is based in Columbus, Ohio. To learn more about T-Pro Solutions and sign up for an in-depth T-Pro Analytics trade management optimization software demonstration, visit or info@t-prosolutions.com. 6
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