Greetings Marketers! 

Welcome to the Special edition! ✨🔥

🛒 Consumer products companies are facing numerous challenges. Inflation is 📈 driving up costs, supply chains are 🔄 unpredictable, and consumer behavior is constantly changing.

In this volatile economy and rapidly changing industry, how can CPG companies thrive, let alone survive? How can they optimize their operations to drive sustainable, profitable revenue growth?

Simply put, old ways of doing business won’t cut it. Today, effective CPG trade and revenue growth management requires a 🆕 approach to keep up with the pace of change.

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Unlocking Growth: The RGM Revolution in CPG 🚀💰

📈 Are you in the CPG industry? Then you need RGM (Revenue Growth Management) – it’s the secret weapon successful brands use to skyrocket their revenue, even in tough markets. 🚀

Why RGM? Why now?

In a world where consumer trends shift overnight and economic uncertainties are the norm, Revenue Growth Management (RGM) is your roadmap to consistent growth. 

🌍 It's not just about managing and optimizing trade spending but also about pricing and promotion strategies, and the assortment and optimization of product mix. 

RGM is your ticket to mastering pricing, promotions, and product mix like a pro. 🎟️

But how can RGM transform your business strategy? What makes it the tool that turns industry challenges into golden opportunities? 🛠️ 

Managing Revenue Growth Amid Relentless Change

🚚💼 While the supply chain problems of the pandemic era seem to have eased, CPG brands still deal with plenty of out-of-stock situations. Instead of low-interest rates and consumers with extra savings in their pocket, companies are now faced with sky-high inflation and budget-conscious consumers.

📈 Soaring inflation has a cascading impact, increasing costs for companies and then raising prices for consumers, which in turn impacts demand.

🎙️ In a recent webcast, industry experts discussed how CPG companies can tackle these 

challenges and improve revenue growth management.

🔍 The need for accurate forecasting, understanding retailer pricing dynamics, and addressing out-of-stock situations has become more critical than ever, said Pete Charette, senior manager of strategic revenue growth management at The Hershey Company.

💼 “The current economic environment has created challenges, but we found that by leaning into our use of systems and processes and in some ways creating new processes, we’ve been able to better adapt and respond to the pace of change,” Charette said.

🔄 Moving Away from Spreadsheets 🔄

🚀 In the face of rapid change, CPG companies require agile systems for promotions, capacity planning, and forecasts. Manual processes and outdated systems fall short.

📊 Paul Smith, SAP's Global Solutions Manager, highlights the persistent use of Excel for trade promotions, leading to inefficiencies.

🔧 A better approach integrates trade promotion and revenue growth into a comprehensive enterprise planning ecosystem. SAP's ERP solutions manage pricing, master data, and trade, offering a unified system of record.

📈 This streamlines processes, providing teams with a single source of truth for promotion plans, costs, list prices, and discount rates. The result? Enhanced agility to adapt swiftly to market dynamics.

💹 Holistic Revenue Growth Management 💹

 A data-driven, integrated approach provides real-time visibility and flexibility. Frequent scenario planning becomes possible, assessing promotion effectiveness. A centralized truth source allows alignment with retailers for better outcomes.

🤝 Collaboration is critical, especially between sales and demand planning. A holistic system connects teams enterprise-wide, offering the same data to enhance forecasting accuracy and optimize revenue growth.

How RGM brings value to CPG businesses

1. Pricing:

Price greatly influences consumer choices, particularly with economic worries affecting 72% of consumers. AI-driven RGM analyzes price sensitivities, market trends, and competitor data to set optimal prices. For example, a US CPG firm employs real-time data for dynamic pricing, leading to increased revenue.

1. Promotions:

Effective promotional strategies are crucial, but many fall short. RGM with AI tailors campaigns to individuals, boosting revenue and attracting new customers. For instance, a multinational food company maximizes its budget with AI, improving campaign effectiveness and customer targeting.

1. Trade Investment:

Trade investment drives growth, yet many CPGs struggle to see returns. RGM powered by AI efficiently plans investments, enhancing ROI. Analytics solutions aid in creating distinct KPIs for vendors, improving performance tracking and accountability.

1. Assortment & Distribution:

Optimizing assortment and distribution is vital for sales and customer experience. RGM with AI helps rationalize SKUs, ensuring the right products reach the right shelves. For example, a British CPG company delists underperforming SKUs, enhancing on-shelf presence and brand loyalty. Similarly, a Dutch brewing company streamlines its supply chain with data and AI, improving route planning and assortment proposals.

📊 Lifecycle of Revenue Growth Management (RGM) for CPG Companies 🔄

1️⃣ Pricing and Price Pack Architecture: Involves market pricing strategy, considering consumer price elasticity and competitor pricing. Balances volume growth with profitability by selecting optimal product size/packaging and pricing combinations.

2️⃣ Trade Spend Management and Optimization: Manages marketing funds for promotions and discounts with distributors and retailers. Aim for maximum sales and profit increase while maintaining brand equity and retail partnerships.

3️⃣ Assortment Optimization and Product Portfolio Management: Selects the right mix of products for different channels or locations to meet diverse consumer preferences. Manages internal product portfolio for optimal sales and productivity, minimizing SKU proliferation.

4️⃣ Promotion: Drives product demand through consumer promotion activities, analyzing the omnichannel journey.

Your Voice 🎤

Phew! That was a lot, right? But hey, knowledge is power🌟. We hope this edition gave you some insights and maybe even cleared up a few doubts.

Got questions or topics you'd like us to cover next? Holler at us! We’ll give you a shoutout in our next edition. If you have any questions, reply to this email and share your valuable feedback so we can aim to address them in our upcoming editions!

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