You should be drilling down because there’s gold in them hills! It’s easy to speak to averages because it requires less work. But averages hide important details.
For example, your average price doesn’t tell you how much of your volume is sold on deal, or that one major deep discount blowout sale drove so much volume in 2 weeks that it is impacting the entire year’s average. You could be too high or too low of your pricing goal vs your competition most of the year but the average hides that. What if you didn’t get that sale next year?
Drilling down properly requires 3 things – and yes you need all three:
- First, syndicated retailer data by week to provide real consumer movement. Without it you are flying blind. It’s expensive – but consider how much you are giving to the retailer
- Next, a superior trade promotion management software product that allows you to know every sale and deal by SKU by retailer, even down to store level, covering volume sold, the type of trade promotion deal given to the retailer, anticipated costs or deductions, and the ability to integrate the syndicated data to compare it, analyze it and draw conclusions that could improve your trade promotion effectiveness.
- Finally, the time, resources and skill set to analyze it. If you don’t have the people with the time and skill sets to analyze the data and draw conclusions you’ll never be able to truly know what impact your trade promotion spending is having on your business.