Adapting to volatility: Implementing a Revenue Growth Management framework for CPGs 

The world is increasingly volatile, both economically and politically. If the systems and dashboards used by your company aren’t reflecting this, you may have a problem. 

Consumer packaged goods (CPG) manufacturers rely on extended supply chains at one end, and sales networks which reach down into multiple retail markets. 

As they are buffeted by economic and geopolitical shocks, CPG pros might be forgiven for constantly changing tack in response to whatever the latest crisis happens to be. 

But this distracts them from longer term concerns, particularly the need to move from legacy operating models to a revenue growth management framework. This is the route towards a more sustainable business model that delivers value to both the CPG manufacturer itself and its key stakeholders, the consumer and its retail partners. 

This article delves deeper into these challenges and examines the tools and processes that can help CPGs respond and develop a robust RGM approach. But it also describes the mindset changes required to truly deliver on this transition, and where CPGs can look for help in delivering these. 

The context of Revenue Growth Management Framework

Very few organizations don’t want to grow revenue. However, there is a critical difference between boosting revenue at all costs, and aiming to grow revenue in a sustainable, managed way. 

The former might deliver maximum impact in the short term but can leave CPGs exposed in the longer term. Markets might become saturated, supply lines might become stretched, and repeated lowest common denominator promotions will eventually fail to resonate with consumers and retailers. Profitability is undermined or becomes unpredictable, frustrating shareholders. 

Even at the best of times, this approach can leave teams of CPG professionals over-stretched, uncoordinated, and even at odds with each other. In more volatile times, life becomes a succession of short-term sales spurts punctuated by ever more bouts of firefighting. 

Revenue growth management aims to develop a secure, sustainable path to predictable revenue and profit growth. It does this over multiple years by making optimal use of the different levers available to CPG companies. These include timely data and the appropriate tools to exploit it, as well as the best efforts of forecasters and marketers, sales teams, and promotion specialists. And it doesn’t neglect the contribution of other teams, from finance to IT. 

A challenging journey to a Revenue Growth Management Framework

At a high level, it’s easy to see the appeal of a revenue growth management framework. 

But by examining the practicalities of implementing RGM, we can see there are multiple potential blockers to its adoption. 

RGM assumes a CPG can leverage five key areas: promotion management; pricing; trade spend; brand positioning; and mix optimization. 

Get these all working in harmony, and organizations can coordinate, fine tune, and optimize strategies, and ensure budgets are used to produce the maximum impact. All in a balanced, sustainable way. 

The organization also stands to gain from improved forecasting and revenue optimization, and sustainable revenue and profit growth in both the short and longer term. 

But potential impediments to this are clear. It assumes the free flow of reliable data, whether for forecasting future business and building programs accordingly, or for optimizing current plans. That includes internal data but should also include external and third-party data – we are looking to capture the potential impact of broader events here after all. 

Bespoke or legacy tools can slow or even choke the flow of data around the organization. This means forecasts are based on partial or out of date information, making them little more than guesswork. Strategies and programs are based on incomplete forecasts and hunches drawn from experience, rather than robust models. 

More broadly, coordination and optimization are difficult when different teams are working with disparate data, and when they cannot actually see what their colleagues are doing.  

This sort of infrastructure might just suffice in a predictable environment, when each new quarter, or year, is met with a revised version of what the teams ran the previous period. At least in the short term. 

But when rivals are awash with up-to-the-minute data and the tooling to exploit it, less forward-looking companies can be left stranded. Decisions are made in reaction to short-term, immediate problems. But these are likely to be uncoordinated and less targeted, blunting their impact. 

Little space is left for longer term planning, even if teams had the requisite data and tools to do so. 

How to move forward with Revenue Growth Management framework

How can CPGs get past these blockers, and develop their own revenue growth management framework? 

The devil is in the detail. And in today’s hyper volatile world, the details change all the time. Functional teams need tools that help them manage and navigate this. 

CPGs need to ensure their teams have systems that combine current internal data as well as relevant data from third parties and retail partners. This gives them the ability to discern what is really happening in their markets. Combined with cutting edge, AI-powered analytics, it will also give more insight into past and current performance and enable more accurate forecasting. 

This contributes to a single view of the truth, allowing different teams to work with common data and see how their plans, actions and optimizations impact other parts of the business. That could be coordinating trade promotions and marketing activities to ensure one reinforces the other. Or it could be analyzing how different pricing strategies feedback through the entire supply chain. 

But changing tooling is not enough. Moving to a revenue growth management framework also requires a fundamental mindset change. 

The right technology can free up individuals and teams, not least by easing the cognitive load and unproductive toil imposed by manual systems. But they must consciously grasp that freedom and get the most out of the tools. 

That includes thinking about how to react to short-term shocks, whether that’s a retail partner being taken over, or a particular promotion being overtaken by events that have impacted consumers. 

It also means longer term thinking, and moving to a scenario planning approach where multiple alternative outcomes are evolved and tested. That means that during negotiations with partners, account or promotion pros can present multiple options. But it also means they are better able to react when the unexpected happens. 

The organization as a whole needs to take a broader view of what success means. This ranges from examining internal processes that block progress and innovation and ensure that teams can align and collaborate. Simply explaining what new tools can enable and encouraging staffers accordingly. 

But it also means taking a broader view of what success means, and what it takes to achieve it. This can be characterized as a trifecta approach, which explicitly aims to maximize value for the CPG manufacturer, and its retailers and consumers. 

This might seem like a monumental effort. But with the right technology, and the right external expertise and experience, it enables companies to reengineer themselves to navigate an uncertain future. 

How Visualfabriq helps you build your Revenue Growth Management framework 

Visualfabriq’s software gives CPGs the essential tools to reengineer their processes and move towards a revenue growth management model across their business. 

It puts a wide range of data and cutting-edge AI-driven analytics into the hands of sales teams, promotion specialists, trade spec professionals, and forecasters. They benefit from deeper insight into their programs and investments, as well as more accurate forecasts. 

They also gain a holistic view of the entire business, as do finance and the C-suite. Optimization of activities across specialisms becomes easier. A shift to scenario planning speeds negotiations with retailers and means less surprises in the longer term. Senior management gains a holistic view of the entire business, while being able to drill down through the business to analyze the effect of individual promotions, or the factors affecting business in a specific region. 

But Visualfabriq also brings an unrivaled ecosystem of deployment and education partners and VARs. 

These have deep experience and knowledge of helping CPGs deploy Visualfabriq and augmenting it with other value-added services. But they are also well versed in the change management and optimization needed to fully leverage the platform, helping you develop a revenue growth management framework that fits your organization and your future. 

Takeaways

Current volatility emphasizes the need for consumer packaged goods business teams to be agile, and able to plan for and adapt to multiple future scenarios. 

This in turn reinforces why CPG firms looking for a sustainable future need to adopt a revenue growth management framework. 

Achieving this will require retooling to replace legacy systems, enable automation, and give staffers a single view of the truth. But this also requires a new mindset within CPGs, with sales, forecasting, promotion, and marketing teams collaborating to make maximum use of data and to innovate in concert with retail partners to benefit consumers. 

Visualfabriq provides the technological tools to allow CPGs to do this, and, together with its partners, the deep knowledge and experience to help CPGs develop the necessary mindset to excel. 

To learn how Visualfabriq and its expert partner network can help your shift to revenue growth management, get in touch here. 

Navigating trade pricing in CPG

Traditionally trade pricing negotiations were an annual event, with CPG manufacturers and their retail counterparts undertaking an elaborate ritualized dance which, hopefully, ended in mutual agreement. 

More recently, this has been transformed. The dance floor may look the same, but the partners often come together many times a year.  

This is partly down to the relentless drive to preserve profitability in a ruthlessly competitive market. But it is also a result of broader changes ranging from longer-term shifts in shopping habits, to endemic economic and political volatility, which has in turn fueled inflation. This has changed how CPG trade pricing models are prepared ahead of those critical pricing negotiations. 

Annual negotiations were traditionally preceded by a mammoth spreadsheet exercise spanning pricing, forecasts, trade spending and other factors. This might have been arduous, overly manual, and often relied on patchy data. But once done commercial teams didn’t have to think about it for another year. 

But this approach is no longer fit for purpose. More involved and more frequent negotiations mean CPGs need to consider many more factors and evolve multiple scenarios and solutions before they even enter the meeting room. This means they must rethink the data and tools they rely on to establish their baseline, produce their forecasts, and finetune their negotiating strategy. 

This article goes into more detail about how the trade pricing landscape has changed, what this means for commercial teams, and what it takes to keep up in this new, highly volatile environment. 

Planning for price negotiations in CPG

An account manager or sales professional should have a good idea of what they want to get out of a trade pricing negotiation well in advance. They will be looking to deliver a result that contributes to the overall profitability goals laid down by HQ and which takes account of the broader context around wage increases, commodity prices, and more, set out by their finance department.  

They will try and balance the percentage increased they are looking to gain against the investment they are able to make with the retailer, whether that is through discounts, contractual spend, or other options.  

This preparatory work might be at a relatively high level of detail, driven by the overall business strategy. This might result in a pricing proposal that matches the company goals, but which might not leave account managers much freedom in their negotiations with retailers. 

Product level planning will bring the conversation down to individual lines. This makes for a much more diversified negotiation and a potentially higher level of adaptability and flexibility. But it will also be far more complex to produce. 

And retailers will have their own objectives and broader context too – and will be speaking to other suppliers. Negotiations might head off in unexpected directions. And if they reach an impasse, the onus is on the CPG vendor to come up with a more compelling offer. Which means reworking their strategy. 

Negotiations can progress far more smoothly if the CPG can anticipate and plan for a range of potential outcomes. Such a scenario planning approach means they can consider a range of conditions ahead of the negotiation, for example, optimizing discounts to achieve a specific net pricing level or understanding why an individual retailer is more focused on cashflow this year. That way, if negotiations take a particular turn, they always have a potential response, ready to present to the retailer. 

Pricing Elasticity Modelling  

One important element in setting prices is the concept of pricing elasticity. This is a measure of how sensitive customers are to price changes. It quantifies how demand for a product will change in response to price changes. 

It is typically expressed as a coefficient, derived from dividing the percentage change in demand by the percentage change in price. A positive coefficient suggests elastic demand, with a change in price leading to a larger proportional change in demand. A negative coefficient – or inelastic demand – means that a price change will lead to a smaller proportional change in demand. 

It’s clear how this can inform trade pricing strategies, even as CPG’s cannot influence consumer prices. But it also takes the complexity involved to a whole different level. And price and demand changes do not happen in a vacuum. Broader competitive issues need to be taken into account, along with the effect of promotions and other activities need to be taken into account.  

Consequently, pricing elasticity – or at least the calculation of it – tends to be the domain of specialist agencies who execute so-called conjoined analysis. However, their reports constitute another data type that can be integrated into a CPG’s own scenario planning process, depending on the tools they are using and the flexibility of their procedures. 

Trade Pricing strategies in CPG and challenges in practice  

Rather than talking about CPG firms setting prices, it makes more sense to talk about pricing strategies. 

As we’ve seen, trade pricing is planned within a broader financial framework laid out by finance and senior management. C-level management will have set growth and profitability goals, which finance will have disaggregated to create targets for price increases, whether at a market or individual retailer level.   

For the commercial team negotiating with retailers, simply raising everything by 5 percent or 10 percent is unlikely to work. The “price” is one part of an equation that will include discounts, promotional activity, and other contractual investments.  

So, things become much more complex. Retailers might be far more wary of a price increase around non-essential or impulse products, reasoning that consumers are less likely to buy beyond a certain point. Likewise, they might feel they have little latitude to raise prices in categories with many alternatives – fresh foods or meal components might be competing with premade meals and even eating out. 

But price rises might be easier to implement in other categories, particularly those with high margins, such as cosmetics or consumer health products. 

Product lifecycles come into play if a CPG vendor is taking the long view. For example, a manufacturer might have a traditional, staple product that is in slow, long-term decline, as well as a newer product with a smaller market share, but a bright future. It might appear the best strategy is to squeeze margins from the traditional product for as long as possible while embedding the new product in the market. 

However, in the longer term, it could make sense to offer a lower price on the established product but advance a higher increase on the newer product. That’s because the innovative, new product is expected to achieve market leading status in a few years. If the price differential is maintained, it will continued to earn a higher margin and contribute more profit as its market share grows. 

The CPG account manager will be dealing with a retail counterpart who must operate within their own financial framework. And, of course, that counterpart will be dealing with multiple CPG vendors with multiple lines, and their own pricing and market ambitions.  

A CPG team might have built a meticulously orchestrated trade pricing strategy combining carefully calculated price rises, combined with tempting contractual investments, which will deliver their targets across their retail partners. 

But if the sales team does not understand a key retail partner, and ensure they have a grip on broader market intelligence, their strategy could be a non-starter, before they even walk into the meeting room.  

If this happens, weeks of painstaking planning and calculation become moot, with sales teams having to rush back to their spreadsheets to rework their offer – and contemplate the knock-on effect on their overall results. 

This, necessarily, takes time. And the market can change again in the meantime. 

How Visualfabriq smooths Trade Pricing negotiations 

Setting trade pricing is always going to be complex. But it doesn’t have to be tortuous. And it certainly doesn’t have to be a manual, spreadsheet-bound process. 

Visualfabriq’s software platform is designed to pull together the disparate data sources commercial and finance teams need to inform their trade pricing strategies, smoothly, quickly, and continuously. Its embedded AI creates reliable baselines and detailed forecasts, allowing sales professionals to create, analyze and visualize multiple scenarios.  

The software spans the full range of CPG disciplines, including trade promotion management and trade spend management, demand forecasting, marketing, and ultimately revenue growth management. So, sales and account pros can model and optimize their trade spend plans and see the effect they have on other functions within the business. And vice versa. 

This increased visibility streamlines the creation of trade pricing strategies ahead of negotiations, including alternative scenarios, which show their impact on the bottom line.  

But it also means that when negotiations create the need for change this can be done rapidly, with full visibility into the effect on trade promotion activity, and finance. Professionals aren’t just saved from returning to their spreadsheets. They don’t even have to leave the meeting room. 

Takeways 

Getting pricing right has always been a complex process, involving many moving parts. 

But in an increasingly volatile market, which demands more frequent price adjustments, legacy tools can’t produce the detailed forecasts or the visibility across the market that sales professionals need. 

Visualfabriq enables the seamless pulling together of data to create, model and optimize CPG pricing models, and their associated contractual investments. 

This removes toil ahead of negotiations, meaning commercial and finance teams can focus on the best outcome for the manufacturer and the retailer, without losing momentum. 

To see how Visualfabriq could transform your CPG trade pricing model, get in touch today to organize a briefing, or arrange a demo. 

Visualfabriq's year-end highlights

As we wrap up 2023, Visualfabriq proudly shares a glimpse into our year-end reflections. This past year marked a pivotal moment for us as we strategically navigated new initiatives that moved our organization forward. We shifted the landscape of our software delivery, entrusting the process entirely to our expanding network of six dynamic partners. Looking ahead to 2024, our goals are set high, promising continued innovation and success. Here’s to a fantastic 2024 for everyone in the Visualfabriq community—a year filled with growth, collaboration, and prosperity.

Watch our year-end highlights video now:

Common pitfalls and challenges in AI-driven Demand Forecasting in CPG

AI-driven demand forecasting, especially in the context of Consumer Packaged Goods (CPG), has gained significant importance lately. It promises to revolutionize demand forecasting in CPG by optimizing revenue predictions and enhancing decision-making processes. However, this journey has its obstacles. In this blog, we’ll explore the common pitfalls and challenges in AI-driven forecasting in CPG and discuss solutions to help navigate them effectively. 

The promise of AI-Driven Demand Forecasting in CPG 

AI-driven forecasting in CPG industries offers the promise of improved forecast accuracy, better inventory level management, and streamlined production processes for various products. It leverages AI algorithms to analyze vast datasets, historical sales data, consumer behavior, and external factors like market trends and economic indicators. This approach allows CPG companies to predict which products will be in demand at specific times, leading to increased efficiency and customer satisfaction. 

Now, let’s delve into the common challenges and pitfalls that organizations may face when implementing AI-driven forecasting in CPG. 

Data quality and availability: 

AI models are data-hungry, especially when it comes to AI for demand forecasting in CPG. They feed on a variety of datasets, including historical sales data, consumer behavior, market trends, and external factors. However, data quality and availability can pose significant challenges. 

• Challenge: Inconsistent, incomplete, or biased data can significantly impact the accuracy of forecasts. Flawed or limited input data can lead to inaccurate predictions, which, in turn, result in misguided business decisions. 
   
• Solution: To overcome this challenge, CPG companies need to prioritize data quality and availability. Implementing data cleansing and ensuring diverse data sources are essential. Collaborating with data experts to curate the best datasets for AI-driven forecasting can significantly improve the accuracy of predictions. 
  
  

Overfitting and model complexity: 

Complex AI models can be prone to overfitting. This occurs when a model learns the “noise” in the training data rather than the actual patterns. These models perform exceptionally well on the training data but fail to generalize to unseen data. This can be a significant pitfall when using AI for demand forecasting in CPG. 

• Challenge: Overfitted models might generate impressive results during testing but fail in real-world scenarios. Businesses might invest in overly complex models that do not provide meaningful insights, leading to wasted resources and time. 
   
• Solution: Mitigating overfitting and model complexity requires striking a balance between model sophistication and real-world applicability. CPG companies should ensure their AI models are validated with real-world data to confirm their utility.  
  
  

Changing market dynamics and external factors: 

In CPG, markets are influenced by numerous external factors such as economic changes, geopolitical events, natural disasters, or sudden shifts in consumer behavior. AI models may struggle to adapt swiftly to these dynamic influences, and this becomes a critical challenge in AI demand forecasting for CPG. 

• Challenge: AI models trained on historical data may not accurately predict future demand during unprecedented events. Sudden market shifts can render pre-trained models obsolete, requiring constant adaptation and retraining to maintain accuracy. 
   
• Solution: While AI can’t predict black swan events, it can adapt. Implement mechanisms that enable AI models to continually learn from new data in the context of CPG. Combining AI-driven predictions with human intuition, such as adjusting when new information emerges, looking at outliers, and operating on an exception-based model, can create a dynamic forecasting system capable of responding to the changing landscape. 
   
  
  

The black box syndrome: 

One of the greatest challenges from a user perspective is what some refer to as “black box syndrome.” AI algorithms, especially intricate ones, can be challenging for non-technical users to fully understand. The fear of making decisions based on a system they don’t comprehend is a significant hurdle for CPG professionals using AI for demand forecasting. 

• Challenge: Users may worry about the lack of transparency in AI models. They want to know how the system arrived at a particular prediction and whether it’s reliable. 
   
• Solution: Addressing this challenge involves offering user-friendly interfaces and clear explanations of the measures in place to ensure the model’s reliability, and people’s understanding of the outcomes. Conducting training workshops to empower users with basic knowledge can also be beneficial. Demystifying the “black box” is not just about explaining AI concepts but, more importantly, explaining the metrics and processes that the software employs, making AI insights accessible to alleviate these concerns. 
  
  

Loss of human control: 

There’s a genuine fear that AI might lead to a loss of human control and intuition in decision-making processes. This challenge arises from concerns about becoming overly reliant on AI systems, especially in CPG demand forecasting. 

• Challenge: Users may resist AI-based solutions, fearing that they will be replaced by AI or that their expertise will become obsolete. 
   
• Solution: To counter this challenge, it’s crucial to emphasize that AI is simply a tool to enhance decision-making, not replace it, particularly in CPG demand forecasting. Encourage users to interpret AI-driven insights alongside their domain expertise to ensure a balanced approach. Human intuition and AI-driven predictions can complement each other effectively. 
   
  
  

Resistance to change: 

Change can be challenging, especially when established methods have been in place for a long time. Users may resist adopting AI-based solutions, even when they promise substantial improvements in CPG demand forecasting. 

• Challenge: Resistance to change can hinder the adoption of AI-driven forecasting in CPG. 
   
• Solution: Mitigate this challenge by implementing change management initiatives, user education, and highlighting the benefits of AI-driven forecasting in CPG. Involving users in the transition process and addressing their concerns can foster a positive attitude toward change. 
   
  
  

Takeaways

AI-driven forecasting in the CPG industry has the potential to reshape the landscape by enhancing personalized product assortments, optimizing inventory levels, and streamlining production processes. However, it’s not without its challenges. Pitfalls related to data, model complexity, external factors, user understanding, and change management can complicate the adoption of AI for demand forecasting in CPG. 

With the right strategies and solutions, CPG companies can navigate these challenges effectively and unlock the true potential of AI in forecasting. By leveraging Visualfabriq’s demand forecasting software, you can overcome the common pitfalls and challenges associated with AI-driven forecasting. Visualfabriq empowers your team to make data-driven decisions, resulting in optimized inventory management, improved customer satisfaction, and, most importantly, increased revenue.  

Take your first step toward AI-driven demand forecasting with Visualfabriq today. Book a demo now and learn how our AI-enhanced solution can revolutionize your CPG forecasting.

Mastering end-of-year promotions in the CPG industry

We’re halfway through the fourth quarter of 2023, and the first signs of the upcoming holidays are already popping up around us, especially in retail. For sales teams within consumer-packaged goods (CPG) manufacturers this means some of the most important promotions of the year are coming up.  

End-of-year promotions are critical to a CPG company’s success. They serve two primary purposes: to capitalize on holiday splurges; and to close any gaps between sales and targets. The success of these promotions depends on their timing and execution. In this blog, we will explore the strategic planning and execution of these promotions to maximize your company’s impact and bottom line. 

Planning holiday end-of-year promotions in CPG
 

Timing is Everything: 

The CPG industry is highly competitive, and in the holiday season, being the first to market can make all the difference. Holiday promotions in CPG, especially those tied to specific occasions like Christmas, can be remarkably effective. If your product is associated with Christmas traditions, for example, it’s likely to sell anyway. However, the goal is to encourage consumers to choose your brand over others or to buy more of your product because of the promotion. 
 

Strategic Goals: 

The key objectives of holiday end-of-year promotions in CPG are capturing a substantial market share, fostering brand loyalty, and maximizing sales without breaking the bank. After all, you don’t want to overspend when customers are already inclined to buy. 
 

Scenarios and Mechanisms: 

To plan successful holiday promotions in CPG, you need to explore various scenarios and mechanisms. Consider different strategies to ascertain the most effective approach for your brand or product. This could involve discounts, bundles, or limited-time offerings. Understanding your market and consumer behavior is crucial.

Closing gaps through promotions 
 

Target-oriented promotions: 

In cases where your business isn’t meeting its yearly targets, late-year promotions in CPG can be a game-changer. Ideally, when initially setting up a strategy, promotions are often planned from January to October, giving you time to accommodate extra volume in November or December. However, when considering gap closure promotions, a CPG needs to understand what such promotions will, or need to, contribute. Thus, organizations depend on reliable predictions and well-thought-out scenarios. 
 

Understanding gaps: 

You need to understand precisely where your business stands and how promotions will close any deficit. Whether it’s volume or value, strategic planning and execution can help you bridge these gaps. 
 

Leveraging Retailer Relationships 
 

Alignment with retailers: 

During the regular promotional calendar from January to October, alignment with retailers can be relatively straightforward: the promotions are usually part of an overarching collaboration structure. But late-year promotions, like those in November, are probably not unique to your organization. This means that, to secure a promotion slot at a retailer, you must demonstrate the value you are adding to their business.  
 

Retailer contribution and technology: 

Contribution to the retailer’s margin and market share plays a significant role in end-of-year promotions. Using software designed for this purpose can help you provide the retailer with a clear picture of the benefits they’ll gain from supporting your promotions. This collaboration can be mutually beneficial. 
 
 

Budgeting and cost management 
 

Cost-effective promotions: 

Depending on the goal of the promotion, preventing losses may be important. This requires a deep dive into budgeting and cost management. In other cases, a calculated loss might be expected or accepted. For example, the main purpose may be to push as much volume into the market as possible to block your competitor from gaining share. Whatever the main commercial driver behind the promotion is, it is always important to ensure that your promotions are delivering their goal and you’re not spending more than necessary to achieve your goals. 
 

Optimization and ROI: 

Ensuring that your promotional spend is used both effectively and efficiently is a critical aspect of end-of-year promotions. By closely monitoring the performance of your promotions and tracking the Return on Investment (ROI), you can make data-driven adjustments to maximize the impact of your holiday campaigns. This approach not only helps in preventing unnecessary overspending but also fosters a continuous cycle of improvement. Accurate ROI measurement provides insights into the success of your holiday promotions, allowing you to make informed decisions and allocate resources strategically, ultimately contributing to greater profitability in the highly competitive CPG industry. 

Empowering your end-of-year promotions in CPG 

Visualfabriq Trade Promotion Master is designed to streamline, optimize, and maximize trade promotion effectiveness and strategies. Here’s how it can empower your holiday promotions: 

• Data-driven decision-making: Visualfabriq Trade Promotion software provides a wealth of analytics, automatically combining all your relevant data sources. It allows you to gain deep insights into customer behavior, market trends, and the impact of past promotions. Leveraging this data, you can make informed decisions on which products to promote, when to launch the promotions, and what the ideal pricing strategy should be. 
   
• Scenario Planning: The software enables you to create and test various promotion scenarios. This is particularly valuable when planning holiday promotions, where the margin for error is minimal. With Visualfabriq TPM, you can simulate different promotional strategies, assess their potential impact, and select the most effective approach to meet your goals. 
   
• Retailer Collaboration: Late-year promotions often rely on strong retailer collaboration. Visualfabriq Trade Promotion Master offers a platform for effective communication and alignment with retailers. As the software is capable of combining all relevant data sources provided by customers, it provides you with invaluable insights that allow you to transparently share the contribution of your promotions to the retailer. You can present a clear and compelling case for why they should support your end-of-year promotions, highlighting the mutual benefits. This collaboration is crucial in securing retailer buy-in for your strategies. Additionally, with just one click, you can conveniently download a proposal in any format requested by the retailer, streamlining the communication and approval process. 

• Optimized Budget Allocation: To prevent overspending, Visualfabriq TPM assists in budgeting and allocating resources efficiently. You can set budgets for each promotion, track expenses in real-time, and ensure that your holiday promotions remain cost-effective. 
   
• Performance Tracking: Monitoring and measuring the performance of your promotions is essential. Visualfabriq Trade Promotion Management software provides the tools to track the Return on Investment (ROI) for each promotion. This helps you assess the success of your holiday promotions and make necessary adjustments for the future. 
   
• Flexibility and Agility: In a dynamic CPG market, you may need to adapt your holiday promotions to changing circumstances. Visualfabriq software offers the flexibility to modify your promotions in real-time based on emerging trends or market conditions, ensuring your strategies remain relevant and competitive. 
   
  

Takeaways 
 

End-of-year promotions in CPG industry are a dynamic and vital component of any company’s strategy. The timing, execution, and retailer collaboration are key. Successful end-of-year promotions require strategic planning, reliable predictions, and a clear understanding of gaps and opportunities. 

To stay ahead of the competition and make the most of your end-of-year promotions, it’s essential to start planning well in advance. In a competitive industry like CPG, your ability to navigate the end-of-year promotions landscape can make a significant impact on your brand’s success. 

For a deeper understanding of trade promotion management and to explore powerful software solutions, learn more about Visualfabriq Trade Promotion Master. Book a demo or download our brochure to discover how this tool can enhance your end-of-year promotion strategies and drive success in the CPG industry.  

The five levers to boost trade promotion effectiveness

Measuring and managing your trade spend is one thing. Measuring your trade promotion effectiveness is a far more complex undertaking. 

True promotion management means moving beyond just tweaking whatever you think worked last year. It means the ability to pull together meaningful data, both internal and external, spanning the entire product range, and the ability to analyze that data, gaining and sharing insights.  

But gaining an insight into trade promotion effectiveness and leveraging that insight for the future is even more challenging.  

Put simply, trade promotion effectiveness is the extra volume and/or revenue and profits a promotion delivers. That and/or alone indicates how complex it is to measure. And that’s before we consider the range of tools a CPG can deploy as part of their trade promotion strategy, from deals and discounts, rebates, special bundles, and more. 

Account managers need to grasp what they’re spending and investing, they need to define measurable objectives, and they need to be able to measure progress and results. 

Afterall, even a promotion that doesn’t return a profit can still serve a purpose, if the objective is taking market share or establishing a new brand. 

Legacy tooling, limited data resources, and largely manual processes, might have been enough to manage this in the past. However, an increasingly volatile market and rapidly improving technology has changed the context dramatically. 

Nevertheless, the fundamental principles underpinning trade promotion effectiveness – what we might call the key levers – remain the same. This article will discuss what they are, and how technology can allow you to exploit them far more effectively. 

Improve Trade Promotion Effectiveness 

So, what are the five key levers in Trade Promotion Effectiveness? And how exactly do they interact? 

Data cleanliness and management 

Trade promotions need to be planned and optimized, and they need to deliver measurable results. This means data, and data management, underpin the entire trade promotion lifecycle. 

From the outset, account managers need reliable data covering previous activity, to establish a baseline, and to measure progress and results against it. Sources can include the manufacturer’s own data, from an ERP system for example, but also, potentially from other functional teams in the organization. Third-party data and syndicated data also play an important role, particularly when it comes to measuring sell-out or consumption. 

Pulling this together manually would be a tortuous process, particularly if data is in multiple, incompatible formats. Data can become trapped in silos, particularly if individual teams are using bespoke tools or even spreadsheets. 

But if trade promotion professionals can pull clean data from multiple sources, without manual intervention, things look very different. They can construct more sophisticated models, free up time to analyze the outliers, evolve and test innovative approaches, and optimize their plans to become more effective. 

Accurate Volume Planning 

How can you understand how effective a promotion is, without a good idea what would have happened otherwise? This applies whether the objective is to generate profit, increase revenue, or drive up volume. 

Whatever the objective is, achieving it will require the appropriate level of stock on hand, at the right time. Stockouts will lead to disappointed customers and partners and wasted opportunities. Overstocking will undermine profitability. 

So, volume planning accuracy is critical, and having the right baseline from the outset is essential. This provides the basis for understanding previous periods, and in turn, generates the insight needed for developing new promotions, in terms of ROI and profitability. Without that reliable baseline, scenario planning becomes moot, and trade promotion effectiveness is impossible to measure. 

Promotion planning and optimization 

Promotion planning is a highly complex task, potentially spanning a range of multiple individual products and retail partners, over varied periods of time.  

Experience is a great teacher – but it is also an expensive one. And if a big promotion misfires, a CPG might not be in a position to apply those lessons in the future. 

So, when it comes to establishing ROI and trade promotion effectiveness, it makes far more sense to run “what ifs” across multiple scenarios. That requires a solid baseline, the right forecasting tools, and of course, the right data. But it also requires a platform that allows CPG professionals to easily pull all these together, allowing them to optimize as they plan. 

This doesn’t just mean that promotions teams can choose the scenario that suits them best. It means they can present internal stakeholders and retail partners with multiple tempting scenarios – finetuning them as negotiations progress. 

Post event analysis 

Working towards trade promotion effectiveness needs focus, time, and the right tooling. But CPG is an incredibly fast-moving world. As the end of a promotion or quarter looms, it’s all too easy to get swept up in planning for the next burst of activity. 

This means that post event analysis can be neglected. At best this means valuable insight into key KPIs such as lift, incremental sales, and ROI, is left on the table. At worst, it means promotion professionals are at risk of repeating strategies that are not effectively contributing to, or even undermining, their business. 

Post event analysis then can be a valuable lever in ratcheting up trade promotion effectiveness. But, as always, this requires accurate, up to date data. And it requires tooling that will allow CPG to pull this together, analyze it, and swiftly generate insights that be shared, discussed, and critically, applied to upcoming promotion planning. 

Pricing optimization 

Pricing is, of course, central to Consumer Packaged Good strategies. But economic volatility and the cost-of-living crisis means price decisions have become ever more fraught in recent years. 

When setting the optimal price for a product or promotion account teams must balance the demands of senior management and finance, the needs of their retail partners, and the real-world experience and desires of consumers. 

Being able to optimize pricing and model its interplay with trade promotion activities is an important lever. It can smooth the path for mutually beneficial negotiations about prices based on data, analytics, and the ability to compare multiple scenarios/what-ifs. 

Two minimal requirements 

Each of these levers is fundamental to improving trade promotion effectiveness. But there are two additional factors – levers in their own right – that influence them all. 

Automation ties them all together. It ensures that the required data is integrated from multiple systems, smoothly and in a timely manner. Automation also means that events, insights, results and KPIs, can be shared, ensuring all teams work with a single, accurate, up-to-date view of the truth. 

Likewise, integrated analytics are crucial to ensuring that data yields accurate forecasts and insights. This can make all the difference as professionals consider multiple scenarios and optimize their plans in flight. This can’t be a one-off exercise. The world is moving too quickly for that. 

Integrated approach to trade promotion effectiveness 

It’s clear that the ability to manipulate each of these levers contributes to improving trade promotion effectiveness. But being able to use all of them in concert takes CPG professionals’ ability to plan and optimize for trade promotion effectiveness to the next level. 

To do this effectively, and repeatedly, in a highly volatile market requires a software platform that encompasses all these disciplines. Moreover, it requires the ability to smoothly ingest and integrate all the relevant data sources – both internal and external – so that every employee is working with the same, up to date information. 

This platform also needs sophisticated analytics, so that baselines can be reliably calculated, paving the way for ROI and other key metrics to be analyzed, and multiple possible scenarios planned and optimized. 

Visaulfabriq’s platform features cutting edge AI to produce accurate trade promotion forecasts and a high-level of automation, to allow CPG professionals to make full use of all five levers when planning, optimizing, running, and analyzing their promotions. 

This high degree of integration and built-in intelligence makes the end-to-end process easier to manage, achieving gains and targets in the short term.  

But it also allows team members and senior managers to move to a more optimized, holistic approach in steering the company. One where investments are smarter, optimized, and feed into more sustained, predictable growth benefiting the company, its partners, and customers. 

Takeaways in Trade Promotion Effectiveness

There are five key levers CPG professionals can use to maximize trade promotion effectiveness. But doing so effectively and repeatedly requires effective automation and cutting-edge analytics capabilities. 

Visualfabriq’s Trade Promotion software allows CPG professionals to pull together the required data, analyze and interrogate it, and use it to plan and optimize trade promotions that will deliver on their objectives. Effectively, and repeatedly.  

This enables a shift from short-term thinking with limited objectives to more holistic programs which remove toil and benefit manufacturers, retailers, and consumers. 

It also allows other stakeholders to build on this, helping the entire organization move towards a more sustainable approach to growth for the long term. To see what this would look like for your company, get in touch here to arrange a demo.

Navigating the shift in Consumer Health habits: The role of forecasting and promotion management

In a world forever transformed by the COVID-19 pandemic, the consumer health industry is experiencing a seismic shift in consumer habits and expectations. The days of waiting for the doctor to prescribe something or just “riding out the flu” are gone, and individuals are increasingly taking proactive steps to manage their well-being.  

This is more than just an attitude shift; it’s also driven by changing demographics. An aging population, with, on average, better health and more purchasing power than previous generations of seniors, wants to remain as healthy as possible. This change brings with it a host of new challenges and opportunities for companies in the fast-moving consumer healthcare sector. 

The evolving landscape of Consumer Health  

The COVID-19 pandemic was a catalyst for a significant shift in consumer behavior. A previously passive approach to healthcare has given way to a more proactive mindset, with individuals taking charge of their well-being. They no longer wait until they fall ill; they’re actively seeking preventive measures to maintain good health. This transformation has led to a surge in demand for over the counter (OTC) products.  

Consumer Health companies now find themselves catering to an expanding consumer base looking for vitamins, supplements, and other self-care essentials. And if people find themselves falling ill, they are actively seeking relief. Understanding and adapting to these evolving habits is crucial for the industry’s success.  

Forecasting in the post-COVID era  

The ability to forecast accurately is more critical than ever. As consumers make more informed choices about their health and well-being, the demand for specific selfcare products becomes increasingly subject to various factors, including seasonal trends and health concerns. Reliable forecasting is key to managing inventory effectively.  

For example, consumers today actively try to aid recovery. If a potential flu outbreak is on the horizon, consumers may start stocking up on vitamins and supplements. However, whilst flu can race through a population in just weeks, the lead time for selfcare products is often longer. Therefore, it’s crucial for companies to anticipate these surges in demand long before “cold and flu season” starts and ensure stock is readily available to ship when needed. This means that insight into consumption drivers is crucial to forecasting. It also forces manufacturers in consumer health to be ready to “stock up,” ahead of that peak in demand. Reliable forecasting and planning are vital to meeting consumer needs promptly.  

Balancing promotions and sustainable growth 

The shift towards preventive self-care and the growing demand for consumer health products make the market ripe for growth. However, this growth is not guaranteed and largely depends on a company’s ability to navigate the delicate balance between promotions and sustainable growth to maintain, or preferably grow, market share. 

Consumer Health companies need to devise effective promotion strategies to capture and maintain market share. For instance, in the sunscreen category, timing is critical. To secure a share of the market before the summer holidays, companies must promote their products at just the right time. Being too early could lead to missed opportunities as consumers are not yet “ready” to purchase, while being too late might result in lost market share to competitors who tempted consumers to stock-up during their promotions.  

The key is in crafting strategies that align with the changing consumer health habits. Consumer Health companies must continuously adapt and innovate when it comes to their promotion techniques to keep pace with consumers’ evolving preferences and needs.  

Leveraging technology and TPM Solutions  

In this dynamic landscape, technology becomes an invaluable ally. Trade Promotion Management (TPM) software, such as Visualfabriq, plays a pivotal role in optimizing forecasting and promotion management. Here’s how TPM solutions can assist Consumer Health businesses:  

• Insight into promotion impact: TPM software provides companies with a comprehensive view of the role promotions play in their overall revenue volume. It helps distinguish between the volume that is driven by promotions and regular sales, shedding light on what portion of profit is attributable to promotions.  
   
• Precise ROI calculation: Accurate ROI calculation for promotions is often elusive without the right tools. TPM solutions empower companies to calculate returns on investment with precision, helping them make informed decisions and achieve higher profitability.  
   
• Post-evaluation and learning: TPM and Trade Promotion Optimization (TPO) tools streamline the post-promotion evaluation process. They automatically gather the available data to assess how promotions are performing, helping companies to extract valuable insights for future planning.  
   
• Scenario planning: TPM software allows businesses to explore alternative scenarios for promotions. This feature provides companies with the flexibility to test various strategies and evaluate their potential impact before implementation.  
   

Takeaways 

The shift in consumer health habits has ignited a transformation in this industry. Companies must be agile and forward-thinking to thrive in this transformative period. By embracing accurate trade promotion forecasting, adaptable promotion strategies, and Visualfabriq’s advanced Trade Promotion solutions, Consumer Health companies can not only adapt to the shift in habits but also seize the burgeoning opportunities they present.  

In a world where healthcare is no longer a passive endeavor but an active pursuit, commercial teams must leverage the right tools and insights to stay ahead of the curve. Visualfabriq’s Trade Promotion Master software is a vital resource in this effort, offering the capabilities necessary to navigate the evolving consumer health landscape successfully.  

To discover how Visualfabriq’s Trade Promotion Master software can empower your Consumer Health business, book a demo today or download our TPM brochure. Don’t miss the opportunity to stay at the forefront of the consumer health revolution.

Empowering revenue growth in Consumer Health with Visualfabriq

The Consumer Health industry is in the midst of a significant transformation. As the world’s healthcare landscape continues to evolve, so do the obstacles faced by these companies. In this blog, we will delve into the unique challenges confronting the Consumer Health sector and explore how Visualfabriq is revolutionizing the industry with its tailored software solutions. 

Challenges in the Consumer Health industry 

The Consumer Health industry is characterized by its unique pace, with products becoming relevant suddenly and losing relevance just as fast, diverse product portfolio, and complex distribution channels. To thrive in this competitive landscape, companies must address several key challenges: 

1. Retail and pharmacy dynamics 

The first issue that these companies encounter revolves around the different dynamics between the retail and pharmacy channels. Retail markets typically provide a wealth of sell-out data, which is crucial for understanding consumer behavior, preferences, and demand patterns. This data-rich environment allows consumer health businesses to make informed decisions around inventory management, promotions, and product offerings. 

However, when it comes to the pharmacy channel, a unique set of obstacles arises. Pharmacies are often supplied by larger wholesale groups or are part of an overarching purchasing organization, leading to a significant level of data fragmentation. Unlike the relatively straightforward retail data, pharmacy data is dispersed across various intermediary layers, making it tricky for consumer health manufacturers to gain a comprehensive view of their products’ performance in this channel. 

Visualfabriq bridges this gap by providing software solutions designed to harmonize retail and pharmacy data. With Visualfabriq, businesses can efficiently manage account hierarchies, thereby gaining better visibility into the intricate web of indirect customers within the pharmacy channel. This capability empowers consumer health companies to leverage data-driven insights in both retail and pharmacy, ensuring that they can tailor their strategies to maximize performance in each channel. 

2. Managing promotions 

Unlike other sectors where promotions might result in negative profitability, Consumer Health products often maintain healthy margins during promotional periods. This characteristic makes investments in secondary space, such as gondola ends and ladder racks, highly lucrative for retailers and suppliers alike. 

The complexity of managing promotions in this industry cannot be understated. Ex-factory stock-up may be out of sync with in-store execution periods, for example. Visualfabriq recognizes the significance of this and gives Consumer Health companies the tools they need to navigate it successfully. Its software solutions offer comprehensive support for managing commercial Profit and Loss (P&L) statements, ensuring that promotions deliver the expected returns. 

Visualfabriq’s AI-driven trade promotion forecasting capabilities are instrumental in helping businesses optimize their promotions. By analyzing historical ex-factory and consumption data, Visualfabriq’s AI algorithms provide insights into the most effective trade promotion strategies. This not only streamlines decision-making but also ensures that promotions are strategically timed and placed to maximize sales and profitability. 

Visualfabriq’s software also addresses the nuanced nature of promotions in the Consumer Health industry. Different product categories may require distinct approaches to promotions, and Visualfabriq’s AI-based forecasting can accommodate specific display criteria. This high level of granularity allows companies to tailor their promotional strategies to each product’s unique characteristics and market dynamics. 

3. Strong seasonality 

The Consumer Health industry experiences pronounced seasonality, with product demand varying significantly throughout the year. For instance, sunscreen sees a surge in demand during the summer months, while hay fever remedies are in high demand during the spring. Understanding and effectively managing this seasonality is crucial for companies to ensure product availability when consumers need it most. 

Visualfabriq steps in as a reliable partner in managing these seasonality challenges. Its software provides powerful tools for baseline prediction and long-term forecasting. By analyzing historical data and seasonal patterns, companies can make accurate predictions about future demand. This enables them to plan production and inventory levels effectively, ensuring that they have the right products on hand during peak seasons while avoiding overstocking during slower periods. 

4. Managing price adjustments 

Price adjustments are a common occurrence in the Consumer Health industry, particularly in highly competitive categories. These adjustments can impact both revenue and profitability, making effective management critical for sustained success. 

Visualfabriq’s software offers a suite of tools for addressing the challenges associated with price adjustments. Its Joint Business Planning (JBP) and scenario planning capabilities empower companies to develop and execute pricing strategies that align with market dynamics and business objectives. 

One notable feature is the ability to adjust Recommended Selling Prices (RSPs) per a specific date and to generate volume predictions using delivered price elasticity coefficients. This agility enables businesses to respond promptly to market changes, competitive pressures, or shifts in consumer demand. It ensures that pricing strategies remain dynamic and adaptable, helping companies maintain profitability and competitive positioning in high-stakes categories. 

Deep dive into the intricacies of these challenges: 

As mentioned earlier, the relationship between product displays, promotions, and seasonality holds great significance in the Consumer Health industry. Some products, like hay fever medication or flu remedies, experience high demand at specific times of the year. Effectively managing volumes and revenue involves not only planning promotions but also sourcing and distributing displays, ensuring product availability and evaluating product performance over these critical periods. 

The route to market for Consumer Health products adds another layer of complexity. The pharmacy channel brings particular challenges when it comes to transparent data. Large pharmacy chains may be very similar to retailers, ordering directly from the manufacturer and sometimes even providing sell-out data, either directly or via a third party. But smaller chains and independent stores purchase through distributors. Whilst sometimes the relationship may be one to one (one distributor only sells to one pharmacy, who only purchases from said distributor), more often than not it’s a one-to-many, many-to-one or many-to-many relationship. The “sales” that go through the underlying pharmacies are often estimates, unless sell-through data are provided, or the pharmacies provide sell-out data. And as these estimates are done irregularly and manually, this practice hinders the ability to assess the effectiveness of promotions and displays and track the product journey accurately. 

So, managing promotions and displays across various pharmacy chains is complicated by the inconsistent availability of sales data. While larger chains may provide reliable EPoS data or work with a third party to supply syndicated data, mid-sized or regional pharmacy chains and independent pharmacies often lack these data structures and thus cannot provide them to Consumer Health manufacturers. This variability makes it challenging to determine the trade promotion effectiveness and displays and set out an overarching strategy to determine how to invest in different types of pharmacies. 

The challenge also extends to the structure of promotions. Different pharmacy chains may have varying incentives and promotional structures. For instance, some pharmacies may prefer lump-sum incentives, while others may opt for percentage discounts. Managing these distinct structures efficiently is a significant problem. 

To work around the lack of consistent data, some assumptions are made when creating offline spreadsheets. For instance, assumptions are made about the distribution of sell-through in case of indirect sales through wholesale. Another case of estimation is the redemption rates of promotions. However, not having a standardized way of creating these can lead to inaccurate, inconsistent forecasts and ROI calculations, underscoring the importance of moving to more advanced, data-driven solutions. 

This all means that transitioning from legacy spreadsheets to a more advanced solution is necessary to address these multifaceted challenges. The transition is motivated by the need for standardization, removal of manual processing and scenario planning, allowing stakeholders to simulate different promotion strategies and assess their impact on sales and profitability. 

Takeaways 

The Consumer Health industry is no stranger to complexity, but with the right software solutions, businesses can not only address these challenges but also thrive in this fast-paced environment. Visualfabriq’s commitment to understanding the unique needs of the sector has positioned it as a game-changer in the industry. 

From harmonizing retail and pharmacy data to optimizing promotions, managing strong seasonality, and navigating price adjustments, Visualfabriq empowers Consumer Health companies to make data-driven decisions and thrive in this ever-evolving sector. As the industry continues to evolve, Visualfabriq stands as a strategic partner committed to helping businesses succeed in this fast-paced landscape. 

In a world where healthcare demands are constantly evolving, Visualfabriq’s software solutions are the prescription for success in this industry. Contact us today to learn more about our Trade Promotion Management and Optimization solution and embark on a journey toward a brighter, more profitable future.

Visualfabriq Bifrost: Simplifying data integration for the CPG industry

The Consumer Packaged Goods (CPG) industry relies heavily on data to make informed decisions, optimize operations, and drive revenue growth.  

However, some CPG companies, especially those relying on spreadsheets or older tools, struggle to effectively combine different types of data due to limitations in their current way of working. This challenge becomes especially evident for those companies in the CPG industry where data is anything but uniform, arriving from a multitude of sources at a rapid and relentless pace. 

The key to successful revenue management is ensuring that all data sources are seamlessly aligned, and those conducting the analysis can readily recognize and trust the data at their disposal. These seemingly straightforward requirements, however, become extremely complex in practice, particularly when organizations provide commercial teams with disparate data sources they need to combine and interpret manually.  

Three critical issues tend to emerge when a structural solution for data combination and analysis, captured in an automated, integrated data source, is absent: 

1. Individuals within the organization start to lose trust in their revenue management software. The data becomes unrecognizable, casting doubt on the integrity of the information used to guide strategic decisions. 

2. Distinguishing whether a problem resides within the software or the source systems of the CPG companies becomes time-consuming and resource-intensive. These diagnostic procedures consume valuable time that could be better utilized for more strategic endeavors. 

3. There’s a heavy dependency on IT resources, which, while essential, do not always possess the requisite business context. This reliance can lead to further inefficiencies and miscommunications. 

Unveiling Bifrost: The power of data integration 

At the heart of Visualfabriq’s commitment to making data integration easier for the CPG industry is Bifrost, a game-changing data integration suite. Bifrost empowers super users within CPG companies by giving them the tools and capabilities to work with data seamlessly, so the data integration process becomes less of a black box operation. 

Bifrost’s core capabilities encompass the full data lifecycle, from data acquisition to analysis, and include: 

• Data Gathering: Bifrost enables users to gather all the data needed for Visualfabriq’s solutions to work optimally. This step is crucial as it ensures that the right data is available for analysis and forecasting. 

• Data Loading and Processing: Bifrost efficiently loads and processes data into the Visualfabriq platform, readying it for use by other modules. This process ensures that data is clean, up-to-date, and ready for analysis. 
   
• Data Visualization: Bifrost provides clear insights into data, making it easy for users to understand where their data is and how it’s being used. This transparency is a significant step toward demystifying data integration. 

• Data Export: Bifrost allows users to export data from the Visualfabriq platform, feeding data back into their automated processes. This two-way data flow ensures that insights gained from the software can be put into action effectively. 
  

The value of Bifrost 

Visualfabriq’s Bifrost brings substantial value to CPG companies, making data integration a breeze. Here’s how: 

• Ease-of-Use: Bifrost simplifies data integration by offering data-transfer-as-a-service, eliminating the need for complex development work. It also streamlines file management and standardizes access to file storage, making the process more user-friendly. 
   
• Transparency: Bifrost’s visualization capabilities remove the black box element from data integration, giving users a clear view of their data’s journey. Centralized logging establishes data lineage, ensuring data’s trustworthiness and traceability. 
   
• Your Data, best-in-class Software: Visualfabriq understands the importance of data security and transparency. Visualfabriq software ensures that your data remains yours, and it takes the responsibility of safeguarding the data seriously. This trust enables flexibility in a rapidly changing data landscape. 

• Simplified Data Management: Bifrost empowers users to take charge of their digitalization journey by rendering data comprehensible and manageable. Through intuitive visualization, it simplifies complexity, obviates the necessity for custom software development, and grants secure access to your data. 
   

Generating insight with Bifrost 

Visualfabriq doesn’t stop at simplifying data integration; its mission is to empower customers to unlock their potential through data-driven solutions. Bifrost plays a pivotal role in this journey: 

• Monitoring (Trust): Bifrost provides the tools needed to monitor data integration processes, ensuring the trustworthiness of data. When users can trust their data, they can confidently make critical business decisions. 
   
• Metrics (Knowledge): Visualfabriq’s data integration layer offers valuable metrics that provide knowledge about data quality, performance, and effectiveness. These insights are essential for continuous improvement. 
   
• Visibility (Insights): Bifrost offers visibility into data, enabling users to gain deep insights into how their data is being utilized. These insights drive better decision-making and help uncover opportunities for revenue growth. 
  

Visualfabriq’s Bifrost is a game-changer in the CPG industry, simplifying data integration and demystifying the complexities associated with it. By empowering super users and providing transparency throughout the data lifecycle, Bifrost enables CPG companies to optimize operations, enhance forecast reliability, and create win-win strategies that drive revenue growth. In a data-driven world, Bifrost ensures that data integration is no longer perceived as complicated but is seen as a vital tool for success in the CPG industry. 

Are you looking to improve efficiency through seamless data integration and ensure easy data integration? If so, discover how Visualfabriq’s Revenue Management Software can provide the solution you need. Learn more or book a demo today to take the first step toward simplifying your data integration journey and unlocking your business’s full potential.

Empowering CPG companies with Demand Forecasting software

In the consumer-packaged goods (CPG) industry, the ability to precisely predict demand is a must, and that’s where demand forecasting software comes into play.  

As consumer behaviors shift and trends change, CPG companies’ need for accuracy in volume forecasts only increases. This is because companies have less room for mistakes and are dealing with changing workforce capabilities, with limited people capable of analyzing data using methods like spreadsheets and legacy tools.  

The challenge lies in the critical need for precise forecasts at the banner and product levels. Commercial teams find themselves compelled to reconsider their volume-to-value strategies and engage in commercial activities with less confidence in their forecasts. The explosion of data sources, combined with manual analysis which is prone to human biases and constrained data cleansing, further compounds the intricacies of the demand forecasting process. 

The challenges of forecasting for CPG companies 

One of the primary challenges facing CPG is the shift from a focus on volume-driven strategies to those centered on creating value. This requires consistent delivery of accurate forecasts, especially at the granular levels of individual sales banners and specific products.  With legacy tools, creating a forecast with this level of detail is too labour intensive, leading organizations to choose to predict with less granularity. However, this compromise is not without its hurdles, as the reliability of forecasts tends to decrease. 

A significant contributor to this challenge is the proliferation of data sources in today’s digital age. With data pouring in from various channels and platforms, demand forecasting has become a more intricate process. The sheer volume of data can be overwhelming, making it difficult for teams to extract meaningful insights and make accurate predictions. 

Relying on manual analysis further compounds these challenges. When humans are tasked with analyzing vast datasets, they are susceptible to biases and subjectivity, which can skew the accuracy of forecasts. Additionally, the manual cleansing of data to ensure its accuracy and consistency is a labor-intensive process that is also prone to human error. 
 

Understanding demand forecasting software: A simple approach 

Demand forecasting software is a valuable ally that simplifies processes for CPG companies. It gathers data from the past, such as which products sold well and when, and combines it with current information. Then, using smart, preferably learning, algorithms, it allows companies to predict how much of a given product will be needed in the future. This results in better planning and decisions that lead to success. 

 
Demand forecasting software provides CPG companies with a clear view of their future product demands. It takes into account both historical sales patterns and external factors that might affect demand, offering a comprehensive perspective. This holistic view empowers companies to anticipate market trends, respond to changes swiftly, and allocate resources efficiently. The software acts as a compass, guiding them through the often turbulent seas of consumer preferences and market dynamics. 

How demand forecasting software helps CPG companies 

• Accurate Predictions: Consumer behavior is ever-changing, and trends can shift quickly. Demand forecasting software equips companies with the ability to predict future demand even during these fluctuations. Some software can create accurate predictions at the lowest level of detail, without requiring additional effort from demand planning teams. This empowers them to make intelligent decisions based on reliable information. 

• Saving Time and Effort: Demand forecasting software takes on the heavy lifting. It automatically gathers data from various sources and compiles it, sparing teams the manual drudgery of data consolidation. This allows teams to channel their efforts into more crucial tasks, such as deriving meaningful insights from the data. Sophisticated AI models play a pivotal role in translating the available data sources into baseline predictions, enhancing the accuracy and reliability of the forecasts. 
   
• Bringing Teams Together: Instead of different teams having varying predictions, the software fosters unity by providing everyone with the same information. This not only enhances teamwork but also leads to more informed and coherent decision-making. 
   
• Customized Information: Different teams have distinct information needs, often varying in their required level of granularity. Demand forecasting software allows tailoring of its output to meet the specific requirements of each team, ensuring that the right data, whether at a high-level overview or a more detailed granular level, is provided to the right people. This customization facilitates better decision-making across the organization. 
   
• Smart Promotions: While it may not always be the primary function of demand forecasting software, it often complements trade promotion management (TPM) as an add-on. However, having accurate baseline forecasts from demand software to fuel TPM significantly enhances promotion optimization. This software goes beyond forecasting; it actively contributes to promotion planning by recommending the timing and extent of product promotions. This guidance empowers companies to fine-tune their sales strategies, ensuring maximum effectiveness in their promotional efforts. 
   
• Easy Product Changes: If a company decides to alter its product lineup, the software simplifies the process. It manages the transition seamlessly, ensuring a smooth changeover with minimal confusion. 

Visualfabriq: Transforming CPG demand forecasting 

Visualfabriq’s Demand Forecast Master stands out in the world of demand forecasting software. By offering reliable baseline forecasts at the most detailed levels of product and account hierarchy, it empowers demand planners with actionable insights. The integration of AI models ensures that forecasts remain accurate even in the face of changing market dynamics. This is especially important in the CPG industry, where shifts in consumer behavior and trends can have a significant impact on demand. 

Visualfabriq’s solution enables different teams to work together, fostering collaboration, and promoting alignment across various departments. By providing a single source of truth for demand forecasts, the potential for confusion or discrepancies is minimized, creating greater confidence in the decision-making process. This unified approach ultimately facilitates the organization’s pursuit of predictable, long-term growth in both revenue and profit, all while maximizing operational efficiency. 

Unlocking the power of AI for better demand forecasting 

The heart of Visualfabriq’s demand forecasting software lies in its advanced AI capabilities. Unlike legacy tools that heavily rely on manual interpretation of historical data alone, AI can take a wider range of factors into account. These can include seasonality, external events like holidays or weather changes, and even social media trends. By analyzing these variables, AI-powered demand forecasting software provides a more comprehensive and accurate prediction of future demand. 

AI removes the burden of manual data analysis and calculations. This means demand planners can focus on interpreting the results and making strategic decisions based on the insights provided by the software. It’s like having a digital assistant that handles the complex number crunching, leaving room for human expertise to shine. 

Takeaways 

Visualfabriq’s demand forecasting software is a powerful tool that empowers CPG companies to navigate the complexities of predicting demand. With its user-friendly approach and AI-driven accuracy, it transforms the way teams work together and makes informed decisions. Visualfabriq’s Demand Forecast Master empowers CPG companies to achieve better results, enhancing their adaptability, efficiency, and responsiveness in a rapidly evolving market. As the CPG landscape evolves, embracing demand forecasting software is an essential step toward achieving sustainable growth and success. 

Book a demo now to learn more about Visualfabriq’s Demand Forecasting solution and pave the way to predictable, long-term growth in revenue and profit with optimal efficiency.