With the definition pretty much in the name, Promotion Monitoring is the action of checking that your promotion is out there and consumers are taking advantage.
While you could just trust that stores are complying and wait until your sales numbers roll in to see how everything was received, that’s a recipe for disaster in today’s modern world. As consumers spend less and less time in stores, your product only has a small window to make an impact. Obviously, a lot of planning and research goes into creating the perfect offer from your side, but no matter how much you’re paying, you can’t always trust retailers to do their part.
If you’re assuming 100% compliance on your promotion plans, then you’re in for a nasty shock. On a consistent basis, feedback from BeMyEye’s crowd found as little as 5% promotional compliance on their first round of audits. That’s a 95% difference between expectation and reality that a lot of CPGs don’t even realise is there.
But how harmful can this really be? Well, according to a consumer review published by McKinsey, where an effective promotion should be generating 5x the returns, 59% of CPGs worldwide – 79% in the US – are losing money on their promotions. That’s not a percentage anyone wants to be part of, and if you use promotion monitoring to its full potential, you won’t be.
What’s the catch?
Promotion monitoring is a powerful tool that’s essential if you want to lift sales before the end of a campaign. That said, with no industry standard on how to actually measure compliance and efficiency, there are a few issues that seem to pop up.
In a 2018 survey, BeMyEye found that while most did track promotional compliance to some extent, more than 75% of CPGs didn’t have above 60% visibility, with over a third of that group unable to reach as low as 20%. Altogether, that’s a massive amount of promotions going unchecked, meaning a massive amount of sales being potentially lost.
The worst thing is, out of everyone surveyed, 98% said they knew their poor promotion monitoring was hurting them. So, why is no one fixing this?
The self fulfilling prophecy you want to avoid
Why do any processes get left behind in the world of business? It’s simple: the budget rules all.
CPGs want a guarantee that they’ll see a return on investment before allocating funds, which makes sense with a new concept like large-scale promotion monitoring. If you’re already aware that you’re losing money, you don’t want to go and spend more money to make that deficit even worse.
The problem here is that getting an accurate ROI for promotion monitoring is near impossible when you don’t have all the figures.
Remember the 75% of CPGs who barely had more than half of the visibility they wanted? Of that group, a massive 66% of them said that they did factor promotion monitoring into their ROI calculations. But if their promotion isn’t getting 100% visibility, then they aren’t getting the full picture of the huge ROI promotion monitoring can generate.
Your timing couldn’t be better
With a third of CPGs believing promotion monitoring could increase their sales between 15-25%, there’s a huge opportunity here to become an early adopter and reap those rewards before your competitors can.
Calls for a more accessible, accurate and standard way to track promotional compliance have led to advancements that are changing the market and boosting net revenue numbers one campaign at a time.
Experts in the field now exist who live and breathe promotion monitoring. They’ve worked hard to understand your specific requirements and are here to help make sure that your promotion goes out with a bang, not a whimper. It’s a seller’s market and by investing in a way to track your promotions, you’re locking in your place as the leader of the pack.
If you’d like to learn more about Promotion Monitoring, you can find everything you need to know and more in our latest whitepaper “Promotion Monitoring: what you’ve always been missing”.