Client Description
Multi Category, $8 Billion + in annual sales
Background
- Retail price and promotion set by individual sales rep.
- No fact based decision making or strategic direction
- Promotion investment rising
- Local decisions creating price gap issues across brand sizes confusing consumers and retailers
Objective
Utilize analytical modeling to develop P&P strategies based on region and customer (EDLP –Hi-Lo) competitive frames and train Sales on P&P tactics that maximize volume and ROI
TPG Approach
- Price-promotion models measuring impact on volume, of distribution, base price, depth of discount, frequency of trade tactics, and price competition
- “Due-tos” providing a quantitative understanding of the impact of changes in distribution, price, and trade activity vs. year ago
- Lift charts showing relative changes in volume by changes in price or promoted conditions
- Account-specific simulations allow for “what if” scenarios to optimize everyday price, depth of discount, and frequency of trade tactics to maximize volume and control
- Costs Analysis of volume response to competitive price changes allows for a determination of volume gained and lost to competition
Impact/Results
- Identified a $10 million improvement opportunity in Trade spending while growing volume 5%