- March 9, 2022
- , 5:56 pm
The Contract Talk
“We have a problem. I can’t pay you”
One of the most uncomfortable conversations to have working with a Retailer is the one where expectations are not met for a promotional program, marketing program, shelving agreement/slotting, Point of Sale placement or new item launch compliance. The agreement started out with the best of intentions, however, somewhere along the way, you didn’t get the return you wanted. The customer made a POG change at the last-minute cutting into your space or moving your brand out of eye level. Maybe a promotion didn’t perform and you discovered the point of sale was never executed. You sold your Boss hard on investing trade dollars with you, only to fail. Now I have a problem with my boss and the customer. “All they needed to do was execute…why didn’t I know about these problems sooner? I could have made adjustments.”
Get to problems fast, so you can solve them faster...
In the Beverage and Tobacco categories, annual shelf agreements that outline share of shelf, position, assortment are negotiated aggressively. Compliance is King in these categories and retailers won’t get marketing dollars without 100% compliance of the agreement. It might not be quite as extreme as Marty Byrde’s situation from Ozark, however, it might feel that way. In the independent retailer universe, even with buying groups, compliance is really hard to assess with manual tools. Fixing compliance problems is always at the store level, if you could get your teams to consistently audit. Good luck with that.
There are headwinds at retail today...
Brands invest millions of dollars in programs to help the retailer sell more of their items. These investments are reliant upon store level execution. Ensuring the point of sale, pricing and items are correct and in the right place within the POG. There are many headwinds today with executing our shelving and promotional programs beginning and ending with labor. We have all experienced gaps in store personnel, merchandising and route salesman coverage. Today, we have AI-Image Recognition technology to help track, measure, and prioritize the chronic problems we are seeing in real-time and over-time. Closing these problems immediately within a program or POG cycle, will ensure a brand has the best chance to deliver the expected ROI. In the end, both the retailer and the brand want to focus their time talking about how to grow the business rather than argue over a contract.
Those brands and retail teams that get to problems fast and solve them faster often become the best suppliers for a retailer which usually results in more space, more items and better promotional timing. These are the same brands that are getting strong ROI from leveraging AI-Image Recognition.
For more information on AI-Image Recognition, visit maxerience.com or contact Jason DeRienzo at jderienzo@maxerience.com..