As a competitive CPG company, you already know the retail “best practices” of fighting for facings, creating eye catching displays, and getting shoppers to demo your products. But despite all of this, it is quite possible you’re losing out on up to 25% of potential sales to your competitors at the point of purchase. How can this be?
While in store efforts are a huge driver of sales, the truth is, less than half of all displays are executed as planned. You may have a fantastic idea for an end cap display, but end up losing that shelf space when you fail to catch an out-of-stock in time. Or maybe you arrange a demo of your newest yogurt flavor at a local shop, but the retailer sets your reps up in an obscure corner of the store without much foot traffic.
So what retail best practice do you really need to prevent poor retail execution? Becoming a data-driven field team. Below, we list a few retail best practices you may have encountered before, and follow up with a discussion on how to make these retail best practices actually work for your business through being a data-driven company that sells more and sells smarter.
Retail Best Practices: The Basics
Pushing for Demos
Demos are a tried and true way of getting your product into the hands of potential customers at the point of purchase. One trick of the trade to making your demos more successful: Try releasing a special line of smaller, sample size products that shoppers will fall in love with, leaving them wanting more and racing to the aisle in search of your larger packaging before their shopping trip is finished! Check out these teeny beauty samplers that surely win customers over.
Strong Retailer Relationships
One of the most important jobs a rep has is to make their account owners feel individually cared for. This is why building strong retailer relationships makes a difference, as a happy retailer will be more likely to offer your brand a better spot on the shelf or a coveted end cap display. One way to ensure your reps are building strong retailer relationships is to make sure they are not overworked and overbooked. If a rep’s territory is too large, they are going to have trouble establishing meaningful bonds with store owners.
Constant Communication
This is probably one of the most important aspects to a successful retail strategy: communication. Reps, managers, retailers, and distributors all should be in constant contact with each other in order to keep operations running smoothly and report any problems as soon as they occur to accelerate recovery. Sending texts and emails back and forth is definitely a huge part of this, but when we discuss communication, we want to emphasize communication of data. Whether it is quantitative or qualitative, having a handle on the data that drives your business and making sure that information is accessible to whoever needs it is key to running a smooth operation.
Taking Retail Best Practices to the Next Level With Data
In the retail world, data is essential, and quality data is what sets top brands apart from their peers. Running a data-driven operation makes you proactive in the field and helps you ensure retailer compliance and flawless execution. Here is an example of what being data-driven looks like:
Let’s say you secured a window display to promote your holiday-themed sparkling water. You send your reps to the store to set up the display, which is meant to remain for four weeks. At the end of the promotion, your team reviews sales over the past few weeks and you see your festive fizz was a hit! To the average sales team, this would be proof that the promotion was a success and that things went smoothly. But your data-driven team takes a deeper look.
Upon closer examination of the data, you see that over the course of those four weeks, your product was out-of-stock twice. Imagine how many sales were lost! Additionally, your team sees that while the holiday-themed beverage sold well, overall sales at this location experienced a decrease, which could be a result of you giving up a bit of your home shelf to get the window display. These important insights show you that in fact, the holiday promotion was not as successful as it may have seemed on its surface. With this kind of information, you’ll know what to look out for next time to prevent the same thing from happening again. This data driven process is the driving force behind any and all retail best practices, as the data is what proves their effectiveness.
Using Data Wisely
Now, collecting data is one thing, but putting that data to work is another. As stated in the example above, the data-driven sales team will take the insights they gained from previous in-store activities to help them make decisions regarding future promotions. We like to call this a cycle of continuous improvement. Coupled with quality data, employing this cycle is a one way ticket to flawless retail execution. So what does this cycle consist of? There are three main components: Insights, Planning, and Action.
Insights are those little tidbits of clarifying information you get after analyzing data. Using again our example from above, the insight we gained was that losing space on our home shelf and allowing out-of-stocks to occur put a damper on the success of our promotion.
Now, based on this information, we will begin Planning for your next promotion. During this planning process, you make it a point to have your rep focus on building a strong relationship with the retailer so this time you can maintain your home shelf space. You also inform your distributor to send in two extra shipments over the course of the four week promotion.
After the Planning phase, you take Action and execute the promotion, all the while tracking data and staying in constant contact with reps and retailers. At the end of the promotion, you begin the cycle all over again, analyzing the data and drawing new insights for your next action.
Sticking with the cycle over time will have a dramatic effect on the quality of your retail execution. Anyone can pull off a demo, but only the best teams know how to generate value beyond sales in the form of data. Of all of the retail best practices out there, using data to inform your strategy and constantly learning from your actions in the field is what will really make a difference in the long run.
