The Importance of Triple Win Thinking

Posted on November 13th, 2014

By: Guy Shepherd


What’s going on ?

Creative idea of businessmanTimes are a changing in FMCG. The big beasts of the past aren’t having the best of times. You only need to look at the share performance of Tesco, Morrisons and Sainsbury’s to see things are changing. Each of these has seen their share price fall by over 40% in the last 6 months. But it’s not confined to retailers. Suppliers are also having a tough time faced with rising costs in a market where increasing retail prices aren’t welcome. Something has to give and it’s typically margins. Not many are enjoying the levels of profit they were enjoying only a few years ago. So what’s changed?

Is it the growing importance of technology in peoples lives? Is it the need to be more connected to the community, through buying local? Is it the changing way we shop? Is it that The City’s expectations keep rising?

In these changing times, Trust & Loyalty are hot topics and highly prized by both suppliers and retailers alike. Earning both trust and loyalty requires a fundamental understanding of the motivations, behaviours and values that are important to Shoppers.

I’m reminded of the Lorax by Dr. Seuss. It’s a story all about ‘biggering’ business regardless of the consequences, and our hero, the Lorax who ‘speak for the trees’. It’s a analogy that resonates with me, as there seems to be many retailers and suppliers who have elevated the importance of hitting a number at the expense of the Shopper.

For TPG, in every successful relationship, there is a 3rd ‘significant other’, who must not be ignored. When we talk to our clients about growing their business through Category Thinking, one of the fundamentals we teach them is the importance of the Triple Win!


What is the Triple Win?

Put very simply, the concept of triple win thinking is about balancing the needs of 3 key parties. The needs of the Retailer, the needs of the Supplier AND the needs of the Shopper. Too often, the needs of the first two parties are placed front and centre, and our shoppers voice is left un-heard, a secondary consideration.

It might seem obvious, but when TPG talk to suppliers, we encourage them to think about the Category and not just their brands or products in isolation. To understand the Category and its dynamics, you need to understand the Shopper of the category.

When TPG talk to retailers, we encourage them to think about their shopper and not just the financial scorecard. We know only too well the pressure our retailers are under, and place on their suppliers, in order to maximise income and fees to improve their numbers and hit stretching short-term targets.

Successful retailer/supplier partnerships are founded on a common set of goals. The Shopper provides a great focal point for joint initiatives and ways of working. A Category Vision which puts the shopper at the centre of joint business plans is a great place to start.

Suppliers who bring an in-depth understanding of the Retailers shopper and the shopper of the Category are always likely to be listened to.

Retailers who recognise the value of strong shopper understanding about their customers and shoppers of the category are also more likely to succeed.

Ignore the shopper at your peril!

There will always be a strong need for having a set of financials on the scorecard that relate to margin, mix, payment days, growth etc. Where Suppliers and Retailers can run into trouble is when these financial imperatives are prioritised so far ahead of shopper considerations that is creates the climate for poor short term decision making. This could manifest itself in poor ranging decisions, poor promotional decisions, and poor pricing decisions.

I’ve seen in the last couple of years some outstanding shopper centred thinking, with retailers and suppliers both laser focussed on the shopper and the behaviour change they are seeking to affect through their category strategies. A focus on the shopper really does drive both retailer and supplier metrics as well, delivering the Triple Win.

Through Triple Win Thinking TPG has helped our clients deliver strong category growth through by focussing on the Shopper and the behaviour change we are seeking to affect.  From occasion based merchandising in chilled meat that drove 7% growth to category re-invention in petcare that delivered 9% growth.

I’ve also seen some poor supplier and retailer activation where it’s clear the needs of the shopper have been reduced to an afterthought. It’s worth remembering that this is the work that actually makes it into store; just think of all the wasted energy on the tactics that didn’t make it in-store.


What’s next?

You would think that in a world where loyalty cards, transaction data and social media are leaving a trail of shopper behaviour like never before, it would be easy acquire some clarity about the shopper of your category. It should be, but we also see many clients with too much data, rather than too little. Data needs curating, and in today’s world where data is readily available, it’s as important to make the right choices. Category Managers, Shopper Insight teams and data agencies need to be editors more than data providers. They need to distil the myriad of data points into simple actionable insights.

Successful Category Performance is based on having crystal clarity whilst balancing the Triple Win. Satisfying the needs of the Retailer and the Supplier, but as importantly satisfying the needs of the Shopper.

Those who win, will be those who…

  • Seek to understand how the shopper currently buys the category
  • Put the Shopper at the heart of their thinking
  • Crystallise data into actionable shopper insight
  • Build a category vision with clear shopper centred strategies
  • Are clear about how to grow the category through encouraging different shopper behaviour through their category strategies
  • Have a scorecard that balances the needs of the shopper with the ever-present financial metrics

The new chairman of Morrison’s remark that supermarkets had opened the door to Aldi and Lidl by “talking to each other, not their customers” in their marketing, shows that there is a way to go until our retailers strike the right balance and place more emphasis on the Shopper.

To paraphrase the Lorax…

‘Unless someone like you, cares a whole awful lot (about your shopper), nothing is going to get better. It’s not’.

If you’d like to learn more about Triple Win thinking and how The Partnering Group can help build stronger relationships, please contact us.



One Response to “The Importance of Triple Win Thinking”

  1. sarah miskell says:

    Do you think you can help us?

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