From Collabora*on to Compe**ve Advantage: Leveraging a Managed Service Approach to Op4mize Promo4ons

Transcription

1 From Collabora*on to Compe**ve Advantage: Leveraging a Managed Service Approach to Op4mize Promo4ons Don Patchell, Sr. Vice President, Business Analy%cs HGS Confiden%al and Proprietary 2013 Promo%on Op%miza%on Ins%tute Spring 2013 Summit

2 The HAVI Organiza%on 2

3 Businesses using analy%cs and data- driven decision processes are 5% - 6% more produc%ve than businesses that don t * Do you struggle to use data to deliver a compe33ve advantage? HGS delivers quan%fiable return on marke%ng objec%ves, as well as accurate and %mely iden%fica%on and interpreta%on of consumer behavior and sales trends that enable cost- effec%ve supply, accurate produc%on and distribu%on planning. Aggrega%on of vast amounts of data from disparate sources Analy%cally driven, collabora%ve promo%ons planning based on accurate demand forecasts Integrated promo%ons and inventory plans Knowledge and insights of purchase demographics Analy%cs to help you more effec%vely make pricing decisions Improving your ROI from marke%ng spending * Harvard Business Review, October 2012

4 The HGS Approach to Promo%ons Management Apply learnings across all stages of the promo*onal cycle back into the planning phase to drive more effec*ve promo*ons. Learn Iden*fy and aggregate lessons learned Understand promo*onal strategies and tac*cs Evaluate promo*onal scenarios by applying advanced analy*cs to forecast promo*onal demand. Analyze the results of all promo*ons in depth and at a local level to bener understand consumer behavior, organiza*onal response and compe**ve reali*es. Calibrate promo*onal forecast across na*onal, regional, and local markets; Tailor product mix and volume projec*ons at store level for op*mal accuracy. Respond to the consumer s reac*on during the promo*on Manage promo*onal execu*on, evaluate effec*veness and iden*fy what's working and what s not. Align all func*onal silos and promo*onal par*es ensuring clarity and buy- in regarding roles, accountabili*es, communica*on, and performance measurement.

5 Drawing Meaning from Data Across the Promo%ons Process Integra%ng data including marke%ng calendars, POS, demographics, weather, census, social media, CRM/loyalty throughout the promo%ons management process is cri%cal HGS specializes in integra%ng vast amounts of data to ensure accurate forecasts & supply plans, along with promo%on op%miza%on and insights Insights Overlay Standard Data Incorporate a range of data sources, whether simply shipment or inclusive of POS and other sources, on a near real- %me basis turned immediately into insights Planning Management Social Media Media Survey/ Audit Supply Chain Transactions & Events Marketing Calendars & Promotion Details Master Data Locations, Products Point of Sale Data

6 IDEAS IN ACTION: CASE STUDIES

7 The HGS Approach to Promo%ons Management Apply learnings across all stages of the promo*onal cycle back into the planning phase to drive more effec*ve promo*ons. Learn Iden*fy and aggregate lessons learned Understand promo*onal strategies and tac*cs Evaluate promo*onal scenarios by applying advanced analy*cs to forecast promo*onal demand. Analyze the results of all promo*ons in depth and at a local level to bener understand consumer behavior, organiza*onal response and compe**ve reali*es. Calibrate promo*onal forecast across na*onal, regional, and local markets; Tailor product mix and volume projec*ons at store level for op*mal accuracy. Respond to the consumer s reac*on during the promo*on Manage promo*onal execu*on, evaluate effec*veness and iden*fy what's working and what s not. Align all func*onal silos and promo*onal par*es ensuring clarity and buy- in regarding roles, accountabili*es, communica*on, and performance measurement.

8 Optimizing Pricing & Assortment Based on Regional Preferences" Business Problem:!! To make nimble, profitable, and fact-based decisions in an environment of well-informed customers and competitors." Approach/ Solution:!! Using POS, consumer and weather data, built robust models that enabled scenario planning for pricing, revenue and margin response. Provided consumer insights on pricing, assortment and regional preferences." Key Learning / Benefit:! " Rigorous statistical models can translate complex consumer preferences into insights to optimize margin, share and revenue decisions."

9 The HGS Approach to Promo%ons Management Apply learnings across all stages of the promo*onal cycle back into the planning phase to drive more effec*ve promo*ons. Learn Iden*fy and aggregate lessons learned Understand promo*onal strategies and tac*cs Evaluate promo*onal scenarios by applying advanced analy*cs to forecast promo*onal demand. Analyze the results of all promo*ons in depth and at a local level to bener understand consumer behavior, organiza*onal response and compe**ve reali*es. Calibrate promo*onal forecast across na*onal, regional, and local markets; Tailor product mix and volume projec*ons at store level for op*mal accuracy. Respond to the consumer s reac*on during the promo*on Manage promo*onal execu*on, evaluate effec*veness and iden*fy what's working and what s not. Align all func*onal silos and promo*onal par*es ensuring clarity and buy- in regarding roles, accountabili*es, communica*on, and performance measurement.

10 Mobile Impact on Demand Orchestration" HGS can bring the science and facts to the table that McDonald s Japan needs to drive their future promotion planning. " Andrew Brough, Chief Financial Officer, McDonald s Japan" Business Problem:!! To understand the impact of mobile coupon tactics, which can increase traffic by tenfold, and build a more responsive supply chain to support inventory availability while reducing obsolescence." Approach/ Solution:!! Utilizing POS data and consumer demographics, analyze mobile coupon utilization and impact on demand to anticipate future impacts and advise on coupon/discount value." Key Learning / Benefit:" " Advance anticipation and near-real-time monitoring and reaction enabled the customer to orchestrate demand and manage the supply chain to a single view of demand, helping to reduce stockouts and maximize revenue." "

11 The HGS Approach to Promo%ons Management Apply learnings across all stages of the promo*onal cycle back into the planning phase to drive more effec*ve promo*ons. Learn Iden*fy and aggregate lessons learned Understand promo*onal strategies and tac*cs Evaluate promo*onal scenarios by applying advanced analy*cs to forecast promo*onal demand. Analyze the results of all promo*ons in depth and at a local level to bener understand consumer behavior, organiza*onal response and compe**ve reali*es. Calibrate promo*onal forecast across na*onal, regional, and local markets; Tailor product mix and volume projec*ons at store level for op*mal accuracy. Respond to the consumer s reac*on during the promo*on Manage promo*onal execu*on, evaluate effec*veness and iden*fy what's working and what s not. Align all func*onal silos and promo*onal par*es ensuring clarity and buy- in regarding roles, accountabili*es, communica*on, and performance measurement.

12 Utilizing Downstream Data to Drive Sales" The real power of the program comes from providing our team the analytics behind the numbers, based on key purchase drivers. " Alison Hill, CAMPUS Strategy & Stewardship" Business Problem:!! A global beverage retailer needed to collect and use downstream data and consumer insights to drive availability, identify trends in a new, alternate channel, and measure the success of the program across different regions.! Approach/ Solution:!! Using POS and consumer demographic data, HGS built scorecards and dashboards for sales teams and management to compare, plan and collaborate across regions to identify gaps in performance and work to achieve targets. " Key Learning / Benefit:! " Increased visibility to downstream data at the local and national levels, enabling fact-based decisions and comparisons across regions, resulting in a 9+ % increase in volume."

13 CONCLUDING POINTS

14 What is a Managed Service? We combine so9ware plus staff augmenta3on to orchestrate and op3mize promo3ons HGS competes through deep supply chain and industry expertise, and a highly scalable technology platform composed of integrated, best-of-breed supply chain management software. Rather than focusing on displacing existing supply chain professionals, HGS competes by offering incremental supply chain capabilities delivered as a service using its own technology and staff.!! (Source: Gartner, Supply Chain Management Business Process Outsourcing Competitive Landscape, January 5, 2012)! Focused on results Data integra%on and data quality management Expert analy%cal resources to augment your staff Best- of- breed soaware S&OP process management Flexible solu%ons

15 Lessons Learned Iden%fy your strategy...do you want to drive traffic? revenue? profit? Promo%onal effec%veness - need to define what success looks like and measure it! Mobile is one tac%c in an overall strategy Small pilots to demonstrate benefits and gain support Roadmap with business cases at each stage

16 From Packaging Supplier To Analy%cs & Planning Leader HAVI Global Solu%ons is the force behind McDonald s Supply Chain, which was recognized as the #3 Supply Chain in AMR/Gartner s Top 25 in 2012 In four separate studies, HGS outperformed accuracy benchmarks for line extensions and new product introduc%ons and is ranked best- in- class in performance among CPG and retail companies according to The Ins%tute of Business Forecas%ng (IBF) Supply over $3B of packaging annually; received over 30 industry awards Generate more than 3 billion forecasts per day Next is McDonald s, rising five spots to No. 3 this year on strong financials and peer opinion votes. The ubiquitous restaurant chain has managed the fine balance between new product growth, and the resulting complexity in supply chain planning and execution. In particular, it has seen great success with the launch and expansion of its McCafe product line to compete in the specialty beverage business, while maintaining leadership in traditional food categories.

17 ABOUT HAVI GLOBAL SOLUTIONS The world s most respected brands rely on the consul4ng, design and execu4on excellence of HAVI Global Solu4ons, LLC (HGS) to deliver a compe44ve advantage on their most demanding and complex challenges across the global supply chain.