Thursday, October 17, 2013

ConAgra, PepsiCo Stress Partnering with Retailers To Serve Shoppers Better

Bob Nolan, Vice President of Customer Insights & Analytics at ConAgra Foods, says manufacturers and retailers need to collaborate to find solutions that benefit shoppers. Common goals and absolute trust are needed for this collaboration, says Jeff Swearingen, Senior Vice President, Portfolio Marketing at PepsiCo.

The executives made their comments in a panel discussion on strategic selling at a recent marketing conference in Chicago. Don Hamblen, Chief Marketing Officer for Roundy’s Supermarkets, was also on the panel. 

Swearingen said PepsiCo has moved away from just selling to focus instead on partnering to identify problems and resolve tension. “There is the potential to change relationships from transitional to fun. It’s a journey you opt in. The relationship grows far beyond one transition or one season.” 
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A key part of strategic selling is the sharing of information. But what if there is too much data, asked panel moderator Michelle Adams, founder and president of Marketing Brainology?

Listen to the [retailers], Nolan responded. Learn what they want to accomplish and what they see as their key business problems and issues. What are the gaps? 

Retailers and manufacturers have had mounds of data for years, but what is really needed goes beyond the reports themselves to deliver new insights about the shopper, Nolan said. 
“We have to look beyond just our business. Bring the retailers something they can act on.” 

He said ConAgra has hired a data mining staff to find the right data to solve customer’s problems. Some of the people on the team are equipped with superior technical skills, while others bring a deeper understanding of the industry.

Meanwhile, PepsiCo has a team that studies what motivates demand, Swearingen chimed in. “The thread of insight gets pulled through to the action you are trying to solve. It’s all about growth.” To make this work, you have to understand the retailer’s brand and how you can help them create distinction, he added.

“Over the last three years, PepsiCo has invested time and money to understand behavior and the motivation behind the behavior in our category. We can talk about behavior opportunities in our category and what we should do differently to change those behaviors,” he said, adding that a company can accomplish something if it commits to a level of granularity and depth of understanding. 

The ideal relationship for strategic selling involves joint business planning, trust sharing, cross-pollination of insights and mutual goals, Adams summarized. She then asked the panelists to identify where this might break down.

Lack of common goals between the retailer and manufacturer, a misaligned incentive structure, slow response to issue resolution, and a substantial difference in overall focus on short term vs. long term were cited by Swearingen as threats to a successful strategic selling relationship. He noted that most – if not all – of these can be addressed and resolved, but, 
“you must be proactive.” 

Another potential detriment to a successful strategic selling relationship is getting outside advice too late, Nolan added. It’s essential to get people from outside the organizations involved early in the process. “You need to hear them. They are in the real world.”

The third panelist, Hamblen of Roundy’s Supermarkets, admitted he gains insights by partnering with manufacturers. That enables Roundy’s to plan better and differentiate itself in a way that shoppers will appreciate. Working with suppliers in joint business planning can be “very transparent, very candid and challenging.” 

Hamblen said such relationships are evolving and becoming much more collaborative. It becomes “mutual business building” and enables partners to “listen smartly and go beneath broad analysis. We have a great relationship with major suppliers. It unleashes a lot of creativity.” 

A better understanding of shoppers is something that suppliers get out of such partnerships, according to Hamblen. “We bring an understanding of our customers and share that with out key supplier partners.” 

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