Segmented commercial offer in modern channel

IMPACT

Sales increase of 15% and profit improvement of
20%, due to a segmented price and promotional strategy with key accounts and
improvement in execution at point of sale.

THE ISSUE

In a stagnant market, distribution brands grew
their share of the modern channel. Standardized negotiation with customers led
to insufficient portfolio adaptation to outlet characteristics and an
inefficient use of resources. Lack of shopper insights limited the accuracy of
promotional activities and package strategy. Additionally, execution standards
were difficult to supervise; consequently, retailer fulfillment of terms and
agreements was not guaranteed.

APPROACH

Work was conducted along three main lines: at
retailer headquarters, to adapt the negotiation and commercial offer to their
own idiosyncratic model; at outlet level, to guarantee execution excellence and
compliance with agreements; and at shopper level, to understand purchasing
occasions, role of brands and packages, and price elasticity. Specific conjoint
analysis by purchasing occasion was conducted.

OUTCOME

Pictures of success by key account and store type were
established, including promotional activity, point of sale material, and
technical equipment; price and terms and conditions with each key account were
redefined, following a segmented approach by purchasing occasion, aligned with
shopper needs and brand/package role. In parallel, the route to market was
adapted in terms of size and skills to ensure target execution standards.