Tuesday, 21 March 2017

Busy NAMs: How to select the right actions when issues are complex and time is short

Nowadays, effective National Account Management means being on top of key trade issues, anticipating their future impact and taking action now in order to optimise the personal benefits.

This is why we try to help you by completing each news update with a call to action.

Essentially, we try to end each news item with a four-step approach:
Where at:
Where headed:
Effect on you:

Specifically, each step aims at covering the following:

Where at: (our NamNews summary of the issue, from the NAM perspective). You need to be able to summarise the issue ‘in a phrase’ in order to focus and communicate...

Where headed: (by the time we tackle the issue, it will have developed and possibly escalated).  In other words, we need to make a judgement re the stage it will have reached in order to pinpoint the effect and action required now.

Effect on you: Pointless raising the alarm, unless you can outline the probable impact on you and the company.

Action: Well based decisive action is required of you (the in-house customer expert) in any issue affecting the supplier-customer interface.

Yesterday’s Daily NamNews bulletin announcement: 

Unilever Reportedly Planning £6bn Food Sell-Off

NAM Implications:
  • Where at: Companies sell divisions in order to focus on more profitable parts of the business. Companies acquire divisions of other companies in order to release synergies by amalgamating operations, rationalising any aspect, in order to cut costs and justify the purchase price.
  • Where headed: Unilever will sell the spreads business, and the acquirer will do what acquirers do…
  • Effect on you: As a competitor, the category will experience a change in competitive landscape as the new owners drive the business harder, without the distraction of other activities.
  • Action: Complete what-ifs on various options and re-evaluate your relative competitive appeal from consumer and retailer POV.
Competitor NAMs have a choice: await completion of the Unilever deal, and allow the dust to settle, or start planning now to optimise the probable new category landscape.  We believe our NAM Implications can provide a little help…

NB. See how NamNews subscribers benefit a little each day. 
Simply download a free copy of January NamNews and see 20 news items analysed as above...

Friday, 17 March 2017

A failed attempt at bridging the generations…again?

You have no doubt seen the TV advt (above) featuring the trendy dad in latest enviable car, attempting to fist-bump his 14 yr old daughter before she exits to meet her pals at school....

Well, yesterday at schools-out time, I boarded a local bus. I made my way to the back, where two 13/14 yr old creatures sat staring at the floor as I advanced.

Putting it down to natural modesty, I gave them a reassuring grandad smile and sat opposite. I was then subjected to a high-intensity eye-roll reaction to my Nike Air Max trainer trendiness as they reverted to their texting conversation...

One needs plenty of self-confidence in this town, I find.....

Am I alone in this? 
(Please add personal experiences in 'comnments' or if you prefer, personal email to bmoore@namnews.com !!)

Thursday, 16 March 2017

The Little Guys Matter Too…..

Although the growth in customer concentration at the top end of most trade sectors, especially UK grocery, has been halted by the advance of the discounters, and global is becoming increasingly local, combined with our increasing ability to communicate directly with the consumer via social media, it could be said that major customers are ‘more manageable’ and thereby less threatening…

In addition, the relative difficulty in influencing online shopping behaviour combined with the high cost of servicing small accounts, could cause us to forget the potential advantages of cultivating and developing business with small customers, especially as a means of keeping our mults ‘under control’ and moving towards fair share dealings.

For instance, as we enter a post Article 50 Brexit environment, the UKs ‘re-appreciation’ of independent retail presents potential lessons in channel re-alignment for local and global consumption.

Four major elements are changing UK channel configuration, firstly causing a significant power-shift within convenience, as the two radically different cultures of Tesco and the Co-op continue to develop the top end of the arena and Sainsbury's increasing rely on convenience for growth…

Moreover, discount drug is in a state of flux, courtesy of Hutchison Whampoa, who incidentally also have ambitions in the distribution of mobile telephony, and as a result, are re-defining their business model in retail…

To this must be added the near certainty that the government will further de-regulate retail pharmacy (self-medication) as a way of easing pressure on the national purse, allowing grocery retail and discount drug to compete aggressively with traditional pharmacy, the only real constraint being the availability of qualified pharmacists…

Given the basics of supply and demand, it seems obvious that those with deeper pockets with which to fund a 'golden hello' are unlikely to suffer from such shortages…

And all this at a time when Walgreens Boots Alliance continue to roll out their global strategy, everywhere….

Whilst ‘risk-seekers’ are prepared to tolerate/encourage ‘extreme’ trade concentration, many suppliers may prefer to spread risk by building and maintaining effective distribution at the lower end of the trade.

As the future is probably more about store-level retail competition, then suppliers should prioritise ‘Intrapreneurial’ store managers within the multiples’ superstore base. However, whilst such managers are/can be highly qualified, and motivated by share options and career aspirations, nothing beats the dedication and focus of an entrepreneurial owner-manager that has managed to survive global recession and flat-line demand, attempting to optimise the performance of a small outlet, living with the constant distraction of overdraft constraints and other life-or-death issues associated with small business survival.

However, whilst small independents undoubtedly need professional help, they are often unwilling/unable to pay market rates. Even if suppliers are willing to supply a version of this help via consultative-selling at outlet level, it is unlikely that full compliance will yield sufficient return on investment in terms of sell-through.

The answer has to be to seek to work with ‘natural-groupings’ via wholesalers, symbol groups and dedicated third-party organisations designed to manage the entire marketing-sales-merchandising role at independent level.

Successful partnership with such intermediaries requires NAM/KAM-level analysis of the partners’ organisational needs, taking a realistic view of the degree of trade-off in having to share their resources with other suppliers, coupled with their need to achieve acceptable levels of return on investment at outlet level.

Providing tailor-made solutions, fully integrated with the intermediary’s own marketing aspirations, targeted at optimising performance at outlet level, can help ensure the achievement of ‘fair share’ vis a vis other suppliers in their portfolio.  

This treatment of the intermediary as a ‘national account’ and managing them appropriately can help in optimising resource allocation across the supplier’s customer portfolio.

Whilst dedicated intermediaries can be of considerable help in managing existing independent sectors cost-effectively, suppliers should also be sensitive to opportunities to cultivate new customers in emerging channels, i.e. there are 17,000 postmasters in the UK capable of granting potential access to 28 million consumers/shoppers each week….

Finally, for those small retailers outside the ‘loop’, who wish to remain independent because they ‘like it that way’, and are by definition highly individual, one can thankfully rely upon the rule of large numbers in finding groups with needs that are sufficiently similar and have sufficient critical mass to make tailor-making a viable option. The solution can then be to design template-variants aimed at meeting the needs of these ‘obvious’ segments. All that remains is to find appropriate media with which to communicate those solutions…

This concrete recognition and development of independent retail options will not only help to balance channel-mix but will also enable the supplier to manage the mults, and thus help to preserve brand integrity…

Alternatively, suppliers have the option of ignoring the little guys and spending the extra cash on fire-proof clothing for the 2017-18 kitchen…?

Tuesday, 14 March 2017

Waitrose doing something by halves could result in a thorough spring clean ....?

                                                                                                                                    pic: Brian Moore

Supermarkets Using “Shocking” Tactics To Obtain Money From Suppliers

The GCA needs a basis for taking action, your experience can help:

  • The key to better working relationships i.e. willing adherence to the spirit rather than letter of the law has to be in the hands of suppliers that are willing to come forward...
  • i.e. If many suppliers complain of the same type of treatment, then ‘an isolated incident’ can become an issue…

Friday, 10 March 2017

Lots of testers, helpers and mums-to-please, but it ain't over until the shopper engages......

                                                                                                                                pic: Brian Moore

Monday, 6 March 2017

When the client actually knows best, despite the research...

Today's emphasis on Big Data as a must-have in brand marketing reminds me of my early ventures in giving business advice to a Danish dairy company re the fact that their UK butter offering might prove confusing to UK shoppers because of its 'haphazard' changes in colour from yellow to white and back again during the year.

Despite my farming and Mom 'n Pop store upbringing in less politically-correct times, I persisted in recommending a purist marketing approach to this farmers' cooperative in that a consumer-test was essential in establishing whether white or yellow was the preferred colour. This insight would then determine whether the product should be bleached or coloured yellow to match consumer need...

The client politely pointed out that theirs was a natural product whose colour reflected the cow's seasonal diet, and told me they did not think much of my reservations re the brand name either...

I often wonder what ever became of Lurpak over the years...

Friday, 24 February 2017

Aldi's down-to-earth proof-of-origin

According to ESM: The European Supermarket Magazine, Aldi Süd are piloting Isotope Analysis to guarantee produce source by locality/region...more details here.

Apart from savvy consumers’ interest in establishing the source of their food, this Aldi initiative will also help in allaying doubts regarding discounters ability to provide like-for-like produce at prices lower than the mults.

In addition to adding cost to the sourcing process, this will heighten consumer curiosity as to the origin of other products available in discounters.

In the UK, this increase in their costs would result in a reduction in the pricing advantage enjoyed by the discounters, but if this proof-of-origin initiative gives Aldi a competitive advantage, others will follow…

Interesting how the cookie crumbles...

Wednesday, 22 February 2017

The extra little help Tesco Ireland does not need during a strike.....

Students and Scargill show support.

A St Pat's lecturer brought her students to Tesco yesterday to teach them about the strike. According to The Journal, the DCU Lecturer from St Patrick’s Campus in Drumcondra, Dublin brought her students to the local Tesco so that workers could inform them about the nature of the strike action.

This comes as the Union of Students in Ireland (USI) reaffirmed its support for the industrial action after workers at Tesco Drumcondra stated that local students had been crossing the picket line and entering the store.

In addition, The Irish Times reports that the terms of employee contracts at Tesco have come under criticism from former British trade union leader Arthur Scargill, who joined workers on the picket line at two of the 23 striking stores on Saturday.

Given that the workers affected by the old contract appear to represent approximately 2% of the Tesco workforce in Ireland, perhaps a defensible way of buying out the old contracts may be the only pragmatic option?

Monday, 20 February 2017

Kraft-Unilever, file closed, now what?

Kraft-Heinz's weekend agreement to withdraw its offer to take over Unilever will not be the end of the story...
  • Fundamental issues remain for each party
  • K-H still need to improve Sales and Margin growth, with acquisition the fastest route
  • In preparing for the Unilever bid, K-H's appetite for Home & Personal Care margins will have been whetted... (think Colgate, Kimberly Clark etc. etc.)
  • Also, Unilever coverage of emerging markets is complementary to that of K-H, see other options of similar profile
  • Meanwhile, moving back from the stock exchange spotlight, Unilever will need to make some signigficant changes to indicate it has 'learned' from the encounter...(think refinition of 'core', sell-offs etc, and more cuts...)
  • More significantly, K-H have demonstrated that a company can make a credible bid for a target more than 3x its size in sales revenue...
  • In other words, anything goes in terms of potential takovers, anywhere...
A what-if is never wasted...