Brands can weather the storm during challenging economic times, so you’ve probably done some trade promotion planning to reach new consumers, build awareness, and drive velocity this year to keep your edge. But without an effective trade promotion strategy, you might be wasting money.
So – let’s take a step back. We’ll assume you have ideal customers, and retailers you work with or wish to partner with. Effective planning will therefore depend on three keys in your strategy:
- Targeting your customer base with intention and good timing
- Maintaining your marketing budget
- Using metrics to prove effectiveness of your trade promotions
1. Target Your Retailer’s Customer Base with Intention
Intentional timing is important because consumers often seek lower-cost brands or generic options unless seasonal or “event” considerations intervene. Plan to leverage key times.
However, according to Forbes, you still face more promotional competition and lower earnings today. So, intention is even more important in your CPG trade promotion strategy.
Being intentional means asking questions. For example:
- Do you want an influx of new buyers?
- Do you want a new CPG retailer on board?
- What are the most impactful promotions to run?
- How much spend will bring the optimum ROI?
The answers affect whether
- the trade promotion will be ongoing or specific to a season, for example, and
- where your best advantage lies, taking trends into account.
But which medium for your trade promotion strategy?
You need to constantly revise which kind of trade promotion is best for each strand of your strategy.
Video has become many consumers’ favorite. Never ignore TikTok’s reach!
But your trade promotion plans shouldn’t offer it to every segment regardless. According to customer awareness levels, there’s still room for
- sampling,
- product launches,
- incentives for retailers and customers,
- in-store displays,
- discounts,
- coupons,
- contests,
- a free gift with purchase, etc.
Each is appropriate to different customer segments. Your brand strategy needs to consider all relevant bases.
For this, costs will vary but there’s an overall caveat…
2. Maintain Your Ad Spend to Build a Trade Promotion Strategy in Challenging Circumstances
We’ll be brief here. This is not the moment to cost-cut in your trade promotion planning!
Reducing marketing budgets seems the easiest way to economize – 74% of CMOs expect, or face, marketing cuts due to the recession – but it’s counterintuitive.
You want your brand to stand out more when there’s less competition!
Think wisely:
- Raising your marketing spend can capture market share when customers dither.
- It’s often easier to keep customers than win them back.
So – in your strategy, also plan to prove which trade promotion costs are paying off…
3. Use Metrics to Measure the Effectiveness of Your Strategy and Trade Promotion Planning
You can’t afford to invest in randomly tickling your customers! You’re buying real estate in a store or online.
So – you need data that prove or disprove your strategy in real time.
Invest in software to leverage data from every possible source of customer intelligence to track what matters most to CPG customers at the moment. (Sustainably sourced cosmetics? Shredded cheese? Eco cleaning fluids? Healthier options?)
And plan also for a cookieless future, because that option won’t be possible soon.
Then analyze the data, because analysis strengthens your strategic position.
Where Does Your Data Position You?
In a virtuous circle!
With real-time data, you can
- both build and adjust your trade promotion management and planning,
- target segmented customers at appropriate times and seasons, and
- produce ROI evidence that makes the case to keep your ad spend at realistic levels as you continue building on your effective strategy!
We Can Help You
If you’d like help from MomentumCPG to build a trade promotion strategy that helps your business gain ground, schedule a consultation today!
