What is it that executives at today's most successful consumer goods businesses lie awake and think about at night? Conquering Latin America and Europe? No. What really deprives retailers of their sleep is the need to get more out of the customers they have.
In the following two case studies you will see how two consumer goods players--Playtex and Shaw's Supermarkets--are using Web-based CRM tools to enhance their business processes in category management and online promotions management.
Case in Point: Playtex and Category Management
When David Butcher took over the category management department of Playtex Products in October 1996, he knew he wanted to automate the company's category management and fact-based selling processes.
Playtex Products markets brands like Banana Boat sun protection, Woolite carpet and upholstery cleaner, Ogilvy home permanents and Binaca breath spray.
Butcher's two-person team was spending too much valuable time cranking out individual PowerPoint presentations for the company's 35 direct sales managers and 100 broker-account executives. "I had just completed one of those huge, three-inch binder, textbook category projects with Giant Food. I vowed never to do one of those again. I wanted a tool that would convince the retailer that we knew what we were talking about, and that we could help them find the solutions they were looking for without having to do the binder," Butcher says, now the company's director of sales.
The tool Butcher implemented in July 1997 was CMSPro from New York City-based software vendor Interactive Edge. CMSPro, a category management analysis and presentation application, is also used by Nabisco, Johnson & Johnson and several other leading companies for sharing highly graphical category, new item launch and merchandising information with retail customers.
CMSPro shows not only merchandise, but the consumer understanding behind it and buying trends as well. It also delivers fully integrated marketing support of the brand, the television advertising, print, the FSI, the shipper and in-store displays. "We even do a kind of virtual reality where we show the buyer the inside of the store and how the merchandisers would work in 3D," Bianco explains.
"It's much more conversational category management," Butcher says. "When customers see it and you talk about it, they get it. You say, for example, 'The sunless category is so important. How are you doing? Are you getting your fair share in sport, but not sunless?' Then you can drill down, show them competitive market information and how they can improve that share."
The system also gives Playtex the ability to share other consumer-oriented advertising and marketing efforts with retail buyers. "We do a lot of events like Taste of Chicago and Spring Break where we give away stuff, and we are able to videotape those things and create a little road show of how Banana Boat interacts with consumers that we can attach to our CMSPro," Butcher says.
When Playtex's category managers met with their counterparts on the retail side, the response was positive. "When our category manager went out and gave a presentation to stop & Shop, the buyer was so impressed that he took our manager's card and then invited him out to speak to all of their retail sun-care store clerks so that they would understand the category better too," Butcher says.
"It changes our customer relationship because we have now become our retail customers' consultant," Butcher says. "When we started this process, we were category captains at Kmart in 1996," he says. "Today we're category captains at Kmart, Target, stop & Shop, A&P, Pathmark, ShopRite, Publix and Eckerd."
Case in Point: Shaw's Supermarkets conquers Promotions Management
The future of promotions management is reflected in a beta program that Vista Technology Group recently completed with Shaw's Supermarkets of East Bridgewater, Mass.
Shaw's operates 167 supermarkets in the Northeast United states. The companies partnered for a beta test with UCCnet to automate the flow of promotion information in real time through a decentralized, Web-based environment. UCCnet is an open, industry-supported, standards-based, scaleable Internet trading community. It enables trading partners to organize, access and exchange item information, which can be used in conjunction with application service providers that may also comply with and run on UCCnet. In this case, it was used to exchange data on promotions.
The value of the beta test undertaken by Shaw's and Vista is that it brings manufacturers one step closer to real demand. That is, since retail buyers tell the manufacturer just how much they can move on the promotion, the manufacturer can compile similar customer-based forecasts and gear manufacturing according to such bona-fide customer demand.
"There's so much fat that you take out of it, that you can automatically have these tremendous savings in the supply chain as well as the demand chain," Weismantel says. As part of its eVista B2B suite, Vista has developed software and systems adapters that allow promotion information to go directly from a CPG company's sales organization to the retail buyer. If accepted, the information can be linked directly to the retailer's ordering system and back into the CPG company's ERP system. The adapters, what Vista calls a Transaction Agent, act as both a sender and a receiver depending upon which side of an XML message it finds itself. "It's slick," Weismantel says. "The agent is like a traffic cop; it looks at the data when it comes in and routes it to transportation or order entry or the buyer or anywhere else."
The transaction agent allows manufacturers and retailer systems to talk to each other efficiently. In the beta test Shaw's Supermarket is running, this means the manufacturer's account rep or a food broker (played by Vista) sends a promotion plan for peanut butter, for instance. Shaw's transaction agent synchronizes that particular promotion with UCCnet and then accepts it if the items are correct and relevant. It then feeds the information to an application developed just for the buyers at Shaw's that brings up all of the peanut butter promotions into a single calendar.
If the promotion is accepted, the transaction agent takes it and drops it into the retailer's order entry system for a purchase order and sends it across the Internet back into the manufacturer's transaction agent as an accepted promotion, which in turn, drops it into the manufacturer's ERP system.
This paperless system covers everything from planning to manufacturing. And since transactions are electronic, they eliminate the inefficiencies associated with paper-based promotions management. "If we can do it with a promotion, we can do it with a purchase order, an invoice and an advance shipping notice," Weismantel says. "There are so many things that we can now bring in, that we are looking at being able to take out another two days of inventory from the manufacturer and the retailer. That's massive."