Let’s imagine a great scenario for a trade marketer in the CPG industry. You have a great brand that offers high-quality products at affordable prices. You have a loyal customer base that loves your brand and trusts your values. But you also face fierce competition from other brands that are vying for the same customers and shelf space. How do you make sure your brand stands out from the crowd and reaches your target audience effectively?
The answer lies in image recognition technology, a powerful tool that can transform the way you do trade marketing. Image recognition technology is an AI-based tool that can identify all types of shelf data, such as products, prices, SKUs, objects, and logos within a digital image. It can help you track, analyze, and optimize your trade marketing strategies in real-time by using data from photos taken at retail locations.
Yes, image recognition can turn you into the Superman of CPG. Here is how you can use image recognition technology:
- Monitor your brand presence and visibility across different channels and regions
- Check if your products are displayed correctly according to planograms and trade agreements
- Compare your performance with competitors and identify gaps and opportunities
- Measure the impact of your promotions and pricing strategies on sales and market share
- Adjust your trade marketing plans based on data-driven insights
Sounds amazing, right? Well, it’s not just a fantasy. Image recognition technology is already being used by leading CPG brands like Coca-Cola, Nestlé, Unilever, and many more to boost their retail execution and increase their revenues.
In this blog, we will show you how image recognition technology can help you take your trade marketing to the next level and achieve better outcomes. We will also share some best practices and tips on how to choose the right image recognition solution for your needs.
Ready to learn more? Let’s dive in!
What is Trade Marketing in CPG?
Trade marketing is a powerful B2B strategy that CPG manufacturers use to drive consumer demand through wholesalers, distributors, and retailers. By tapping into the distribution capabilities of their partners, CPGs can increase sales, revenue, and market share.
To succeed in trade marketing, companies need to develop pricing and promotion strategies that reflect the unique needs of different channels and customers. This involves understanding the value proposition of each product, the price sensitivity of different customer segments, and the optimal mix of discounts, rebates, and incentives to maximize profitability and loyalty.
But perhaps the most important element of trade marketing is collecting and analyzing customer data to gain insights into consumer preferences, behaviors, and trends. With the abundance of data available today, CPGs can make data-driven decisions that help them meet consumer needs and exceed their expectations.
First Things First: The Challenges and Opportunities of Trade Marketing
Trade marketing is not without its challenges and opportunities in today’s dynamic and competitive environment. Some of the challenges that CPG companies face include:
Digital transformation: Like many other things, the COVID-19 pandemic has changed the game for CPG brands. Consumers are flocking to online shopping and e-commerce platforms, which offer convenience and availability at their fingertips. CPG brands need to adapt their trade marketing strategies to leverage digital channels and media, such as social media, influencer marketing, online ads, email marketing, etc. They also need to optimize their product data and content for online visibility and discoverability, which means CPG brands need to be agile and smart in their digital trade marketing efforts. They also need to be responsive and relevant to the changing consumer needs and wants in the digital space.
Brand loyalty: Consumers today have more choices than ever before when it comes to CPG products. They can easily compare prices, features, reviews, ratings, etc. online before making a purchase decision, which makes it harder for CPG brands to retain their loyal customers and attract new ones. CPG brands need to invest in building strong relationships with their customers through personalized offers, loyalty programs, feedback mechanisms, etc. They also need to differentiate themselves from their competitors by highlighting their unique value proposition and brand story.
Sustainability: Consumers today are more aware and concerned about the environmental and social impact of their consumption choices. They prefer CPG products that are eco-friendly, organic, fair-trade, cruelty-free, etc. CPG brands need to align their trade marketing strategies with their sustainability goals and communicate them effectively to their customers. They also need to ensure that their supply chain partners share their values and standards on sustainability.
Key Components of Trade Marketing Strategy In CPG and Retail
Understanding your trade channels: Different retail trade channels have different characteristics, opportunities, and challenges for CPG brands. For example, modern trade channels like supermarkets and hypermarkets may offer more shelf space, visibility, and data sharing than traditional trade channels like mom-and-pop stores or street vendors. On-premise trade channels like restaurants and bars may require different product formats, pricing, and promotions than off-premise ones. Therefore, CPG companies should segment their markets based on trade channels and sub-channels, and tailor their strategies accordingly.
Optimizing your product portfolio: CPG companies should constantly evaluate their product portfolio to ensure that they offer the right products for the right customers at the right price points. This may involve launching new products, discontinuing underperforming ones, or adjusting pack sizes, flavors, or variants to suit different consumer preferences and occasions. CPG companies should also monitor their competitors’ products and innovations to stay ahead of the curve.
Leveraging data and analytics: Data is a powerful tool for CPG companies to gain insights into their performance, customer behavior, market trends, and opportunities. CPG companies should collect and analyze data from various sources such as sales reports, retailer feedback, shopper surveys, social media, etc., to measure their effectiveness across different trade channels and regions. They should also use advanced analytics techniques such as machine learning or artificial intelligence to generate actionable recommendations for improving their trade marketing outcomes.
Building strong relationships with retailers: Retailers are key partners for CPG companies in delivering value to consumers. CPG companies should establish long-term relationships with retailers based on trust, collaboration, transparency, and mutual benefit. They should also provide retailers with support, such as merchandising materials, training programs, category management advice, etc., to help them sell more of their products. Additionally, they should negotiate favorable terms with retailers, such as shelf placement, pricing discounts, promotional allowances, etc., to increase their profitability.
Measuring the Success of Retail Trade Marketing Efforts
Trade marketing is not a one-time activity but a continuous process that requires constant monitoring and evaluation. CPG companies should measure the success of their trade marketing efforts using various metrics and indicators that reflect their objectives and goals. Here are some of them:
Return on investment: A positive ROI indicates that the campaign was profitable, while a negative ROI indicates that the campaign was not successful. CPG companies can use AI-based image recognition and analytics services to optimize their trade marketing investments by gaining real-time insights into shelf conditions, product availability, pricing, promotions, and compliance.
Trade Promotion Optimization: TPO is the process of using data and analytics to plan, manage and execute promotional activities that maximize the ROI of trade promotion spend. Expectedly, trade promotions in retail are discounts, incentives or other offers that consumer goods manufacturers provide to retailers to increase sales of their products. TPO helps CPGs and retailers collaborate effectively and align their goals and strategies.
Sales volume and value: The sales and volume metric measures the number and value of products sold due to a trade marketing campaign. It indicates how effective the campaign was in driving conversions and increasing revenue. Today’s most reasonable way to go for CPG companies is to use AI-based image recognition and analytics services to track their sales performance across different retail channels and regions by analyzing shelf images captured by field teams or store cameras.
Customer satisfaction: Although there are countless metrics for customer satisfaction, there are some rules to increase it in physical retail. The first thing to do is, of course, ensuring optimal shelf conditions, minimizing out-of-stock situations, offering relevant promotions, and providing accurate information. Thankfully, AI-based image recognition tools offer an all-in-one solution. Let’s continue with how image recognition creates wonders in trade marketing challenges.
How Can Vispera Help You Hack Trade Marketing Challenges in CPG?
Vispera can help CPG companies overcome these challenges by providing AI-based image recognition and analytics services that enable them to radically improve their trade marketing efficiency and effectiveness.
Vispera’s solutions allow CPG companies to:
Gain real-time visibility: Vispera’s solutions can automatically process any kind of retail shelf image from a variety of sources, such as field teams, store cameras, or third-party providers, and transform them into actionable insights. Vispera’s solutions provide CPG companies with granular data on shelf conditions, product availability, pricing, promotions, and compliance across all channels.
Increase operational efficiency: Vispera’s solutions automate and streamline the execution and tracking of trade marketing activities by eliminating manual processes and human errors. Vispera’s solutions can help CPG companies reduce costs, save time, improve consistency, and enhance scalability and adaptability.
Boost marketing effectiveness: Vispera’s solutions can optimize the ROI of trade marketing activities by using advanced analytics and machine learning algorithms. Vispera’s solutions can help CPG companies select the optimal products, prices, promotions, and places that will maximize sales volume, value, market share, and customer satisfaction.
By using Vispera’s innovative solutions that leverage computer vision technology, CPG companies can hack their trade marketing challenges, gain competitive advantage, and grow their business. Contact us to find out now.