Are Your Competitors Over-Promoting? Monitoring Promotions with Bedrock
Your consumers are facing the fear of economic uncertainty as they read the headlines of yet another company shutting down and issuing mass layoffs. Everything around them has gotten more expensive. Value is more important now than it has been in the past several years. Yet it’s easy to overdo it and promote too deeply or frequently which then diminishes a brand’s goal of high trial via promo while growing your everyday base business.
CPGs must strike a balance with their pricing that will satisfy all stakeholders – consumers, retailers, and the brands themselves. There are 2 ways to attempt to arrive at this balance – luck or data.
Using luck, you take last year’s account plans and alter them with a slight increase/decrease vs. the previous year. This assumes everything has stayed the same, yet we know things have changed for our consumers, especially those that aren’t as financially secure as others. This approach worked 10 years ago when markets were more stable and consumers more predictable. This is the easiest thing to do but not the wisest.
CPGs all have access to roughly the same data, but how they use it varies greatly. A CPG often has unintentional tunnel vision by focusing on only their brand’s performance. They often don’t have time to run a full analysis of the market and their competitors. One of Bedrock’s strategic advantages is the system can help you look at the marketplace from 30,000 feet while helping you also get into the weeds without getting stuck down rabbit holes.
By harmonizing all of the data into a single source of truth, the Bedrock platform gives CPG brands an instant snapshot view into the market, broken down by retailer, to get a more comprehensive view of the promotions run throughout the category with a focus on what works vs. what doesn’t.
CPGs can measure their performance against competitors to compare frequency of promotions, average length of promotions, the promotional pricing discounts, and overall sales performance to view effectiveness of each brand’s approach.
How can CPGs use that data in a way that gives them a competitive edge? Bedrock’s Promotional Analysis storyline gives CPG brands more than just a glimpse into their own performance.
One of the most important elements to promotional strategies is defining what the promotional price will be for your product. Deep discounts can be very enticing for shoppers but can impact the overall bottom line. By taking a holistic view of the data, you can see what price points performed best.
Another variable with promotions is the frequency of how often to go on promotion. Going on promotion too often can have a negative impact on the brand’s perception and unintentionally teach shoppers to expect them, which causes them to wait for the price to drop. The Bedrock platform uses automation to populate intuitive calendars with promoted activity for your entire competitive set at a retailer.
The type of merchandising that was applies to generate your sales lifts matters. Why? A display is much more expensive for you than a TPR. A display needs to generate a higher lift to warrant the increased trade spend. With Bedrock’s Promotional Analysis storyline, these cost-saving insights are revealed to you in seconds.
Overall Promotion Effectiveness
Blindly guessing or just testing promotions on a whim without analyzing competitive data can result in wasted trade spend and hurt the overall profitability of the company. By leveraging a full competitive view of promotions, retailer by retailer, brands can see how other companies’ promotional periods performed and get a better idea of what didn’t work for them so that it can avoid the same pitfalls without spending a dime.
There are two ways to do this – luck or data. We recommend letting your competition using luck, you can track what works and then double down on a winning strategy before they figure it out. Ask us how.
Ready to see the other ways Bedrock gives CPGs the upper hand? Book a demo!