Pricing Performance Deep Dive Framework for CPG

By: Armin Kakas. This is a guest post from our partner Armin Kakas on pricing performance deep dive for CPG. It originally appeared on Armin’s blog with this version edited for consistency. To learn more about our partnership please read our partnership announcement.

The 5-minute guide for building a dynamic, integrated, reproducible performance deep dive for CPGs using internal and external data.

Analytical fire drills and knee-jerk pricing actions are becoming increasingly common in the consumer goods industry.

With intense competition and ever-changing customer needs, companies must be agile enough to rapidly adjust their pricing & promotional strategies. This is table stakes to remain competitive and deliver relative value to their consumers in today’s data-driven world. However, many organizations are still relying on disjointed Excel sheets and complex PowerPoint decks as the primary way of delivering actionable insights.

Outdated Approaches

This outdated approach often results in unfocused and overwhelming analytics leaving decision-makers with too much information without meaningful insight or value. As a result, analytics teams must find new ways to deliver actionable insights efficiently to drive value with a sense of urgency.

This applies in particular to the consumer goods industry (including CPG, other consumer brands, and adjacent categories).  Here the amount of time spent arranging visuals, charts, and tables in pretty formats often take substantially longer than the actual analytics effort.

This has been exacerbated by various syndicated data and market research providers, where 50+ page PowerPoint decks to answer 2-3 key questions are still the norm.

All this is the antithesis of being analytically agile in organizations and encourages “storytelling and pontification” vs. “taking action and moving the needle.”

Integrated Deep Dive

By creating a reproducible, integrated performance deep dive, CPGs can identify specific areas of improvement:

  1. Optimize promotion ROIs to drive incremental sales and profits.
  2. Identify whitespace distribution opportunities to grow volume.
  3. Improve channel profit pools (ensuring that channel partners are not margining up and eroding demand) to drive Operating Profit.
  4. Manage customer and product mix more intentionally to increase Net Revenues and Gross Profits.

Building these actioned analytics capabilities will help them stay ahead of the competition in today’s market.

In the quick guide linked below (a presentation) we outline a deep dive to address Revenue performance shortfalls. Specifically tailored for CPGs, our approach follows a proven recipe focused on reproducible and highly actionable steps.

You can also download the presentation in PDF format if the player doesn’t work below.

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