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There comes a time in small businesses that to continue growing, it is necessary to change the way of working, incorporate new practices, adjust internal processes, tools and develop new skills that probably do not exist in the sales team. It is necessary to face a Commercial Transformation process. Business Transformation is not simply hiring new software or hiring a new Sales or Marketing director. It requires the ability to continually improve the business skills of the entire team to sustain above-market growth over the long term. Constantly beating the market requires a high-performance commercial team that begins to operate in a more agile and efficient way, and above all, it requires the very serious commitment of the company's management. Having worked on many projects of commercial organizations of all types of companies over the years, we have been strengthening the TMC Consultores methodology, developing a proven comprehensive scheme to successfully implement a Commercial Transformation in your company in 5 stages: Where are we and why change? Transformation Plan Organization Design Organization Activation Continuous improvement Where are we and why change? The company's first step is to understand where we are about the best in our industry (best-in-class): route to market models, organizational structures, competency profiles, management and operational practices, innovations, and technology; all this contrasted with customer satisfaction studies. This will allow us to prioritize opportunities to focus initial efforts where greater and faster returns on investment (quick wins) are achieved. This will always be essential in a business transformation project. Patience is not a common characteristic in CEOs Within this initial phase, a robust work team must be formed, made up of key influencers from each function and ensuring the commitment and participation of the company's leadership team (CEO, CMO, COO. Without this we are going straight to failure). Some companies have begun to form Commercial Transformation Directorates, which, although they can lead and shape projects, should never leave out the functional leaders of what will ultimately be the areas to be transformed. At the end of this phase, it is necessary to define a common vision of the problem to be solved and why a change would bring significant potential benefits. These benefits will ultimately become the communication and motivation elements of the project. Transformation Plan Any significant Business Transformation begins as a corporate strategic objective and continues with a detailed plan with a clear statement of intent with a realistic vision, specific and measurable objectives, resources, people responsible (again, make sure to include the top team), and timelines. Transformations will not be successful unless they achieve substantive victories within 6 to 12 months. These victories will build trust and can help fund long-term change. Additionally, the plan will consider actions to correct, maintain motivation and reward those collaborators who advance in the required direction. Organization Design To achieve transformation, we must design a World Quality Business Organization with agility and high leadership and change management skills. Among the key tasks of this phase are: Design of the appropriate Structure for each function. Short, medium and long term. Position Profiles and Critical Competencies by function and position, incorporating a High Performance culture. Analysis of functional and/or individual gaps in capabilities and skills. Process Optimization, incorporating best practices, to redirect the organization, reinforcing behaviors and new habits. Creation of Integration Mechanisms for Planning, Coordination and Multifunctional Commercial Communication. Perhaps one of the main differences of the companies considered as Top Performers vs. the rest is that the former take the organization very seriously and do not allow each new manager or director to make adjustments to the best of their knowledge or opinion (usually little knowledge of the subject). These practices usually end up creating a kind of patchwork quilt or Frankenstein organizations, very ineffective and with little capacity for growth. A solid organization is based on a clear vision of where it is intended to go, the adequate and gradual incorporation of best practices, processes associated with positions and structures, position profiles in line with what is expected of them, activation and training plans. to close gaps, among others. Organization Activation Enabling Sales Teams with the new critical competencies, practices and desired behaviors requires extensive planning and again a lot of commitment from the leadership team and key influencers from each discipline. This is where many Business Transformation Processes fall down. The activation of the organization implies a change of mentality and the development of new leadership and change management skills. For managers, the focus should be on coaching, analysis, planning, and problem solving. Sales and account teams, for example, need specific skills in detecting customer needs, formulating value propositions, consultative selling and negotiation, among others. It will most likely take multiple waves of activity to meet your transformation goals in each business discipline. In fact, most successful transformations in terms of positive business results (sales, profits, etc.) take years to implement, not months. However, these transformations work like virtuous circles, where each improvement in results and each advance in capabilities creates a cycle of continuous improvement. Continuous Improvement Building a high-performance culture requires the implementation of specific processes and tools to redirect the organization, reinforce behavior and create new habits. But the really critical component, and one that almost no company can do on their own without the help of a good consulting team, is putting in place the right metrics to track and tune performance. Without them, it's virtually impossible to understand what works and what doesn't. Additionally, continuous improvement requires an important component or philosophy of modeling and coaching. All the successful models we know of put a lot of effort into disciplining managers in this practice. It's about a real commitment to improve your people by providing constructive feedback, empathizing, helping them solve their problems and reinforcing their strengths. It is also about modeling new behaviors, something that rarely happens in practice. A continuous communication strategy of the results obtained and future improvement actions will keep the team motivated and committed to the change. The successful Business Transformation must also be accompanied by the best Organizational Climate. A challenge that can be very rewarding! A deep and lasting Commercial Transformation can be a great challenge that will require a lot of leadership and courage from the company's management, but it could be the only way not only to generate future business growth but also to barely survive in some cases. On the other hand, the leaders who have taken on the challenge with energy, enthusiasm, and total certainty of the expected results have achieved their vision in a very gratifying way. At TMC we have accompanied the Commercial Transformation process of a large number of companies in Latin America. We have a portfolio of cases that we too are very proud of. Need help? Just contact us. Written by Juan Manuel Domínguez R. CEO of TMC Commercial Consultants. If you are interested in learning about TMC's consulting or training products in this area, write to us at contacto@tmcconsultores.com and we will immediately contact you. If we are not yet connected on LinkedIn, it will be a pleasure to have you in my network of contacts https://es.linkedin.com/in/juanmanueldominguezr If you want to discuss some ideas on how to implement it in your company, contact us at contacto@tmcconsultores.com and we will respond immediately.

Although many organizations have made significant progress in terms of Shopper Marketing, there is still a lot of ignorance about what it is and what needs to be done to properly implement it in the organization. Why is Shopper Marketing so important? The intensity of the struggle at the point of sale is getting stronger and selling our brands is becoming more difficult and costly every step of the way. According to the latest study by the Point of Purchase Advertising Institute - POPAI (Consumer Buying Habits Study), the all-time record is broken; 82% of purchasing decisions are made at the point of sale. Now more than ever Buyers, whom we will call Shoppers, are choosing their brands -and sometimes even categories- in store, after exploring and/or evaluating a set of variables that guide them to their final selection. Although this is not new -already in the 80s it was said that two thirds of purchase decisions were made in the store-, it is not until recently that both Retailers and Manufacturers understand that a deep knowledge of the needs , habits and behaviors of consumption (this already existed) and purchase (this is the new) and the relationship between these behaviors can be decisive for the subsistence of both. The other determining factor is the growing importance of Retailers. Given the concentration levels of sales volumes in a few accounts, the consolidation of private labels (also known as own or distributor brands) and the limitations of space at the point of sale, the cost of competing in stores has been increasing. steadily increasing. The big chains demand more of everything (money, merchandising, tailor-made business plans and activities, exclusive references, etc.) and they are getting what they want. Brands have to be much smarter to compete in this environment. Therefore, the importance of better understanding the Shopper and the Retailer's environment becomes evident again. So, what is Shopper Marketing? Let's start by saying that it's not what Wikipedia says (especially because of how poorly written it is): Shopper marketing takes place in the store and its goal is to convert the consumers who visit the store into buyers… Oh my God! -I say this-. The first problem with this definition is that the Shopper may not be the Consumer (for example, a woman who buys: diapers, men's deodorant or dog food), or that the buyer is one of the consumers of the category, but not necessarily the most relevant of the family group (the case of a male buyer when he buys cookies, ice cream or soft drinks). The other problem with this definition is that perhaps the buyer is already a "consumer" of my brand and what I want is to maintain it and prevent my competition from converting it to theirs. Shopper Marketing is the series of actions that seek to influence the customer's purchase decision in the different purchase channels. The influence process begins in many cases before the visit to the point of sale, and its purpose is to increase sales, the strength of the brand (Brand Equity) and the category. What do we have to know about the Shopper? Despite the fact that more than half - in some of my clients it exceeds 80% in some categories - of the global Marketing investment is going through the Sales Channels, companies continue to invest much more in market research related to with Consumption and the Image and Communication of the Brand and very little in relation to how people make purchasing decisions. In other words, companies know a LOT about their Consumers and very little about their Shoppers. They may be the same person but they must be considered from different perspectives, because while the Consumer shows consumption habits, the buyer shows purchasing habits and when crossing both information we can have surprising findings. The understanding of the Shopper ranges from the most general related to the category to the most particular. We must know not only how and when you buy the brands in a category, but also what other categories you buy, -complementary categories- (rum and cola is one of my favorites) or on the contrary, are there substitute categories? In a recent study we determined that in a market of one of our clients, rice and pasta were substitutes for a certain profile of Shoppers, especially when given the opportunity to compare prices. Both our client and the Retailers were very happy with this finding! Our obvious recommendation, and one that had a positive impact on sales, was to put the two categories in different aisles. We must have many answers to design a successful strategy: How does the Shopper feel towards our category? What are the emotions generated by our category and brands? Is it easy to understand and locate your SKUs, such as refrigerated soft drinks and juices, or complicated to understand, such as cookies or personal care? Does it inspire exploration and evaluation time like ice creams, juices and salty snacks or is it a destination category and something boring like detergents and milk? How does the Shopper decide on the brand and its different presentations? Is the brand or the price more important? If it is price, how do you compare prices? By weight, size or consumption? Do you buy one or more brands or references from the same category to satisfy your needs? Additionally, we have to understand how the Shopper behaves in relation to the different Sales Channels. For example how he buys beers, yogurt or toothpaste when he shops at a supermarket and how he buys it at a convenience store. Also how are their habits and expectations in relation to the different Purchase Missions (regular purchase, replacement, top up, etc.), Consumption Occasions (tonight's dinner with the in-laws or the soccer game with friends) and Also Consumption Habits. I know a Shopper who always complains that her Retailer hasn't figured out that curry and other Indian cuisine should be displayed in the English category, and not next to Japanese cuisine, where it's always displayed. All this also allows us to design and implement more advanced Segmentation Models focused on the different behaviors, habits and purchase missions. Fundamental to any effective Shopper Marketing strategy. So… How do we define Shopper Marketing? Definitely I would dare to define it as the process that allows us to deeply understand the needs, behaviors and purchasing habits of the Shopper, and reveals information that, when crossed with consumption habits and occasions, allows us to generate findings, detect opportunities (Insights) and design successful initiatives to influence the desired purchasing behavior at the point of sale (physical and digital). To conclude, we have to understand that Shopper Marketing is a complex process that will require organizations to address this issue in a comprehensive manner, both from a structural point of view (functions, processes, training, etc.) and from an organizational point of view. adequate budget allocation. Need help? Just contact us at contacto@tmcconsultores.com

We often direct our commercial efforts to achieve or maintain leadership, to reach sometimes unattainable sales goals, to be the most efficient in cost reduction, or to make significant investments in technology. We can do the best and best possible effort. However, if we are not able to continuously, quickly and completely adopt the new behaviors and skills required by our commercial teams, we may be overtaken by our competitors. In theory we all have the potential to be successful in any of the objectives mentioned above or in many others. But being successful is not the same as being A MARKET REFERENCE, a characteristic that is generally achieved through COMMERCIAL TRANSFORMATION. This is the real challenge for companies in increasingly competitive environments: to achieve leadership and maintain it in the long term, to create, know how to motivate and maintain high-performance work teams, generate profits for employees and shareholders, and the most important, gain an important place in society by creating an organization that generates a positive impact on the market and leaves its mark. Often, companies make a great effort to achieve the long-awaited Commercial Transformation and very often, and this is what we have been able to observe in our 25 years of consulting experience, this transformation is a failure, or at best , a frustrating incomplete job. The good news is that we know why it happens. BUSINESS TRANSFORMATION is not a process that results in better cost analysis, or that generates more competitive products, or more effective sales calls, or the development of more advanced technologies. It is a trip that adds all of the above and more; it is a plan for continuous improvement, permanent challenges and a long-term vision. It is to grow above the market and stay. It is to open the gap between us and others. It is leaving a positive impact on people's lives. And it only takes one element to achieve it. We know what it is. WHAT IS THE KEY ELEMENT TO ACHIEVE BUSINESS TRANSFORMATION? All diagnoses agree that the main factors in the failure of Business Transformations are the lack of commitment and involvement of the company's top management (CEO, CMO, CCO, etc.), which means that it is useless to think about the commercial transformation of a company without the in-depth involvement of the positions of greatest responsibility. Obviously, it is also not feasible to carry out a transformation process with teams limited in resources and poorly trained for the task, the absence of a transformation plan with a clear vision of where it is intended to go and clear metrics for measuring progress. When we have worked as consultants in Transformation processes, we always warn this TOP TEAM that there must be room on their agendas permanently and as a priority for critical activities or meetings that have to do with the process, and that it will work even better if they are those who lead these meetings and are directly involved and very committed to the results, always open to teamwork, admitting mistakes and listening to good ideas that are generated around them. The leadership, motivation, and serious commitment of the HIGHER RANK team generate the expected results across all the commercial functions of Marketing, Sales, Supply, Pricing, Insights, etc. more or less simultaneously. Without involvement, there is a predictable disappointing result: a rapid loss of credibility is generated and attrition ends up destroying any chance of success. The decision to change is one that leadership cannot postpone. Better business capabilities are needed to respond to something we see more and more often in the marketplace: short-lived competitive advantage. Competitors are quick to adapt to innovations, new products and business practices, and that reality will only accelerate as companies develop more analytics capabilities. Without BUSINESS TRANSFORMATION the race will be exhausting and will not produce the expected results. How to carry out a robust, comprehensive and sustainable Commercial Transformation? Over the years we have been giving answers to a series of questions that we consider vital in the transformation process: How to properly incorporate the skills, abilities and practices required to ensure leadership in the market? How to change and incorporate the new desired behaviors and high reaction capacities in the entire sales team? How to adopt a high-performance culture in the company's DNA? How to ensure commitment throughout the organization to guarantee the transformation? We have obtained the answer to these questions through successful transformation projects for companies of different caliber and it is summarized in the following five phases: Where are we and why change? Transformation Plan Organization Design Organization Activation continuous improvement A challenge that can be very rewarding A deep and lasting Commercial Transformation can be a great challenge that will require a lot of leadership and courage from the company's management, but it could be the only way not only to generate future business growth, but also to simply survive in some cases. . It is the real power in highly competitive markets. On the other hand, the leaders who have taken on the challenge with energy, enthusiasm and total certainty of the expected results have achieved their vision in a very gratifying way. Need help? Just contact us.

We recently worked with a client who asked us for a full assessment and possible reorganization, if necessary, of their Trade Marketing function. The Management felt that the Trade Marketing team was not working, delivering added value or generating the expected return and that, additionally, the alignment with the Consumer Marketing department was quite limited. The first thing we did was to understand from the different angles (Marketing, Sales and Trade Marketing) what was the role, both real and expected, of Trade Marketing and how and when they should generate value. Later we seek to understand what information, studies, management and operational processes, practices, tools, among others, they had to carry it out. Additionally, we evaluate the actual skills and abilities that exist in the function to carry out the expected work. And finally, we talk to customers to have an external and comparative opinion with other competitive companies. The results obtained were very similar to those we have achieved in many organizations. We will try to summarize the main findings, which are usually the fundamental factors that limit superior performance due to misalignment and poor understanding between Consumer and Trade Marketing. Limited knowledge of the Consumer and much less of the Shopper Perhaps one of the most common findings is the little knowledge about the Consumer that exists in many Trade Marketing organizations. It seems that for some companies this information (market studies, results, Insights, etc.) is reserved for Marketing. "That is very confidential," someone tells us. Despite the fact that most of the Trade Marketing departments have been assigned, albeit partially, the function of "Shopper Marketing", there is much ignorance of habits, behaviors and occasions of purchase and consumption of the different categories. Consumer Marketing begins with knowing the consumer. Trade and Shopper Marketing… too. If Consumer Marketing seeks to influence or change consumer decisions in one way or another, the actions to identify and influence the Shopper derive, to a large extent, also from the consumer. For example: If my category is complementary and/or there is a high correlation of consumption with another, Trade Marketing should seek to unite them in some way at the points of sale. If, on the contrary, the category has another substitute in a certain segment of consumers, it is better to seek to separate them in the stores. Limited knowledge of the strategy of the categories and strategic brands In order for Trade Marketing to develop a differentiated value proposition, it is essential that it knows the current situation of the brand and what is expected of it in the future. That is, not only does Trade Marketing need to know if the brand has a trial or loyalty problem, for example. You must also know what the specific objectives of the brand are, what the strategy is, who the target consumer is and what the desired positioning is, among other things. But the reality is that we have some Trade Marketing teams that are very far from knowing this information. "That is even more confidential." If Trade Marketing does not know in depth both the Consumer and the objectives and strategies of the brand categories, there is little it can do to increase purchases and consumption of the same. They are units that end up carrying out isolated activities, more to satisfy the demands of strategic retailers than to generate value for their own business. The lack of knowledge on the part of Trade Marketing of the Positioning and occasions of consumption that Granola Bars wanted to be given in one of our clients, generated a wrong location of the category in the POS's (it was placed next to the cereals), generating confusion and mistaken perception of the desired moments of consumption (between-meals or snacks). Weak Planning, Coordination and Evaluation Mechanisms One of the biggest limiting factors for an adequate integration and alignment between Consumer and Trade Marketing are the non-existent or limited Mechanisms (Management Processes) of Planning, Coordination and Evaluation of Commercial Initiatives. The lack of discipline, rigor and formalization in the way commercial activities are planned and implemented (and sometimes evaluated), in addition to limiting the chances of success, is the greatest generator of conflict and misalignment between the different commercial functions: Marketing, Trade Marketing and Customer & Account Management. Non-strategic approach of the Trade Marketing function Many Trade Marketing organizations have been designed and conceived more to carry out certain tactical or operational tasks such as promoter management, Sell Out actions on products "parked" in customers, merchandising development, among others. However, when we delve into its functions, we detect that there is little that is more strategic: Deep knowledge of the Shopper in the most strategic categories in the different Sales Channels that allows identifying the appropriate incentives and mechanics according to the purchase mission by type of store. Development of a Customer Segmentation Model based on the Shopper that allows identifying the most strategic stores in the entire universe. Extensive knowledge of the needs of strategic customers. Channel/Category and Key Account Plans that comprehensively address the situation and objectives of the brands with the existing opportunities at the level of Shopper, Channels and Clients. Development of Execution Standards to achieve the Perfect Store. If the above is not present in the organization, it is unlikely that Consumer and Trade Marketing can align to generate high impact initiatives. And perhaps the most relevant of all this is that by not having the correct responsibilities assigned to the function, it is most likely that we will not have the Trade Marketing team with the necessary skills to carry out a work of greater added value. In conclusion… It requires, on the one hand, a Trade Marketing team with in-depth knowledge of consumers and brands, and on the other, a function with the necessary responsibilities and skills to translate marketing objectives and strategies into impact initiatives in the strategic channels and clients that maximize the Sell-Out of the brands. From the organizational point of view, there must be solid Mechanisms (disciplined and formalized) for Planning, Coordination and Evaluation of commercial initiatives. The healthiest thing to achieve optimal results, once Senior Management detects the problem, is to have a Commercial Consulting team with extensive experience in team alignment. Need help? Just dedicate 30 min of your time to explain your need and thus be able to propose a job offer.

Understanding the Shopper's Buying Mission and their behavior in the store is now much easier than in the past. The sales ticket stores are very valuable information for the teams responsible for managing categories and key accounts. Today, we don't need to ask questions to learn about customer expectations and preferences; it is possible to optimize the assortment, the location of the products in the store, design promotional activities that are more appropriate to what the customer is willing to buy and use relevant stimuli that activate the desire to purchase. Some analyzes allow us, additionally, to identify the best times to carry out the training and qualification of the personnel or the logistics operation of replenishing inventories in shelves or refrigerators without inconveniencing customers. The 4 most common analyzes that we usually carry out with the tickets of a commercial establishment are Pareto, Time, Correlation and Incidence. 1. Pareto Analysis: Vilfredo Pareto Federico Damaso 1848-1923 was an Italian engineer, sociologist, economist, political scientist, and philosopher who introduced the concept of 80-20 in 1906 helping to describe the distribution of income in Italy and the development of the field of microeconomics. This analysis focuses attention on those products that account for 80% of the total volume of the category or business. It is through this principle that we determine, for example, the best day to carry out a promotional activity in the store, to minimize waste on days with little influx of the target Shopper. Additionally, it allows us to identify the way in which most products are purchased to avoid designing offers that are outside the purchase pattern: What day of the week concentrates the highest volume of the category? What time of day? What is the most demanded product format? What is the price range? What is the segment? – example: light, gluten-free, lactose-free… What is the number of products for each ticket? What is the average value of the ticket that contains the category vs. store average? 2. Time Analysis: This analysis is built considering the evolution of the billing and the total number of receipts of the store over a given period: the days and times of greater effectiveness and efficiency of the operation. To start we build a simple matrix that combines the time the ticket was issued with the number of tickets issued. For example, we can find a store that is visited mainly in the morning. If we consider that the infrastructure of the store is designed to operate efficiently with the largest number of transactions, it means that we have a large number of hours a day in which the operation is inefficient, because we have products that are not selling. This may be the case, for example, in stores that are used as the preferred breakfast spot, and during the rest of the day, the flow of customers decreases considerably. If we build a second matrix, but now using the Ticket Value on the vertical axis to identify the period of the day when Shoppers spend more money in the store, we can see that the customers who leave more money in the store per transaction are the of night time. And what do we do with this? If we define the average value of the ticket as a target for the periods that are below, we can establish a clear reference of the store's sales potential during hours that are not being effective. By combining both graphs we can build a 4-quadrant matrix using the averages of each variable to define the strategic priority per turn of the operation: For example, the quadrant with a high number of tickets and value above the billing average is receiving a high number of strategic customers, and to avoid losing sales, attention to customer processes and services must be reinforced, that is, we will focus on EFFICIENCY and as a consequence, we will give priority to aspects such as reducing waiting time in lines. The quadrant with a high number of tickets but with a purchase value significantly lower than the average of the store should be focused on promotional actions to motivate the Shopper to buy a greater number of products or more expensive versions (Increase the VALUE OF THE TICKET). In the hours of less traffic of shoppers with low ticket value, the focus may be on the implementation of training programs for the staff, to improve the quality of customer service, replenish the inventory or fix the Planogram on the shelves avoiding, for example, fill all the beverage refrigerators at the same time, assigning a specific time for beer and a different one for non-alcoholic beverages, which are purchased at different times. 3. Correlation Analysis: It is used to identify the products that are normally purchased in the same visit of the Shopper to the store. It is very useful to determine the products that should be promoted together by day and time to increase the value of the ticket or determine the most effective secondary locations for each category and thus optimize the distribution of spaces within each store. It is important to emphasize that the correlated products are not necessarily part of the same consumption occasion of their category, that is, we can obtain as a result that the category "toilet paper" has a high correlation with "beer" in a specific supermarket during weekends. week, indicating that the products are purchased at the same time by the same Shopper. When the objective is to increase the visibility of categories that are in development, it is necessary to go beyond the products that we consume and consider those that we buy in the same visit to the store. So, as unconventional as it sounds, we could expect a higher return on investment if we put the extra toilet paper display near the beers, for example. The correlation index varies between [-1 and +1], indicating the following: If the correlation index is equal to 1: positive and perfect! The two categories are always purchased on the same ticket. If the correlation index is 0: there is no relationship between the two categories analyzed. Negative correlation close to -1 indicates products that are substitutes, that is, when one category is purchased, the other is not, and vice versa. In a client that sells the “rice” and “pasta” categories, we detected in one of its studies of consumption habits that in the lower socioeconomic classes these two categories are substitutes, since both are considered carbohydrates that accompany the main protein , such as meat, chicken, or fish. Subsequently, in an observational study of shopping behavior in supermarkets, we were able to corroborate that in those stores where pasta and rice were in the same aisle, generally next to each other, the shopper from the lower classes compared prices between both categories and opted, in general, for the purchase of the cheapest option. Finding that in most supermarket chains the two categories were together in the same aisle, one next to the other, it was recommended to carry out a pilot test in 10 stores, moving the pasta to a different aisle, together with other products such as sauces and olives, among others and compare the results for 8 weeks. The results were very clear. Where the two products were separated, their sales increased, as did the number of versions purchased, especially the pasta ones. These results helped create a success story to convince other stores to take the same action and improve the performance of both categories. 4. Incidence Analysis: The fourth and last type of analysis that we recommend doing at this stage is critical to support the definition of the strategic role of each category in the store. In this case, we build a Matrix considering the Incidence, or relationship of each product version of the category in the total number of tickets sold and its Net Operating Margin, that is, the total value that remains for the store after deducting all the costs. directly associated with the sale of the category. The quadrant of low incidence in tickets and net operating margin is made up of COMPLEMENTARY products, which serve to fill the spaces and bring news to the store's customers. The totally opposite quadrant is made up of those products present in the majority of sales receipts and that represents a good part of the money produced in the store. These products are considered essential and cannot be missing, so some of them can be used to POSITION the store as the preferred place to buy those categories. Those others that for some reason cannot be used to differentiate themselves from other stores, such as mass consumption products whose offer is common between channels and stores, can be used as CASH FLOW generators. Any failure in the availability of these products generates a high impact on the performance of the category. Those products present in most of the tickets, but with low participation in the net money resulting from the operation, are normally used as generators of TRAFFIC, since the retailer usually lowers its margin to a minimum to attract customers to the store. This quadrant is normally formed with high-turn products. The focus in this quadrant is space efficiency, as products must rotate many times to reach the average turnover for each square meter of the store. The last quadrant (PROFIT) is built with products with high representativeness in the operating net margin, but with low presence in tickets, that is, they are products with high value for money and gross margin that are sold only to some specific clients. In a convenience store, for example, cigars, wine and whiskey can be located in this quadrant. The focus in this quadrant should be inventory management so as not to end up with a lot of product on hold, affecting the cash flow of the business. As you can see, with these 4 types of analysis we can obtain a large number of INSIGHTS to maximize the operation of the store and the sales of the categories. Need help? Just write to us contacto@tmcconsultores.com

Before thinking about the inclusion of new digital channels to sell your products and services, it is necessary to create or strengthen the 4 pillars of Commercial Transformation to avoid belonging to the 80% of companies that fail in the first attempt to adjust their business, reducing the risk of negatively affecting your corporate image and your relationship with strategic clients permanently. The economic, social and even emotional effects of major crises such as the one generated by Covid-19 have been shown to have a tremendous impact on consumer and purchasing habits and brand loyalty. Additionally, and depending on the duration of the crisis, the impact affects the business models of our clients, having to adjust our learned operational routines and with which we have made our business grow. In the world, many countries have gone through numerous political, social and economic crises, being able to learn from the experiences of those companies that not only survived, but also managed to grow their business over the years. The first lesson obtained from our clients consulted in countries that have gone through major crises in recent years, such as Spain, USA, Argentina, Nicaragua and Colombia, is that “the one who learns the fastest wins”. Surviving the crisis requires that the commercial team strengthen its existing capabilities to keep the ship afloat, and at the same time open a space to quickly learn the new skills necessary to operate in a new scenario described as VUCA - Volatile, Uncertainty (Uncertainty in English), Complex and Ambiguous. THE PILLARS OF BUSINESS TRANSFORMATION And so we briefly describe the 4 key elements that make the difference in companies that succeed in their digital transformation process, regardless of the size of their turnover or structure. All of them manage to create internal processes to continuously respond, adjust, learn and update the skills and abilities of the sales team to sustain greater and faster growth than the market. Beating the market once is a challenge, but winning consistently over time requires a high-performing commercial team backed by strong digital, analytical, and quick-reaction capabilities underpinned by continuous learning from experience to reduce the risk of making the same mistakes over and over again. If you are having difficulty convincing your company leadership team about the need to start by strengthening the 4 pillars of Business Transformation, we recommend that you quickly develop a document with the answers to these 3 questions: Where are we and why change? How do you intend to develop those pillars? What do you need? Main barriers that organizations face during the Business Transformation process Disconnection of senior management in what they consider more operational phases. Big mistake! Slowness, delays and interruptions by internal bureaucracies to carry out the different activation initiatives. Cultural characteristics of the company combined with ineffective change management plans. Training and development methodologies that are outdated and poorly aligned with new realities and technologies. And perhaps the most common: change in corporate and/or commercial priorities for economic, competitive or any other reason (example: Covid-19 crisis). What to do if the Business Transformation process stops? Evaluate the level of progress If you are not achieving the objectives or progress is slower than required, you need to review the original plan and try to understand what limiting factors or barriers are generating those results. Here bureaucratic issues may appear, functions misaligned with the objectives, insufficient resources (human, economic, etc.), inefficient change management or simply program leaders without the required leadership or skills. Despite the fact that we have mentioned some possible factors that are affecting your Transformation process, each organization has its own life and it is necessary to continuously evaluate and understand which ones are affecting or slowing down said process. Need help? Just contact us.

In recent months, the concept of Shopper Marketing has taken on a very high relevance in the work agendas of retailers and manufacturers. The reasons are quite obvious: Shoppers have been forced to review their buying habits. But the game has changed – and yet many retailers and their suppliers still operate with old practices for their benefit, missing out on valuable opportunities to collaborate through the process of the Joint Business Plan. Much has been written in recent years about the importance of collaboration between retailers and manufacturers (joint initiatives that go beyond the normal course of day-to-day business, to achieve significant improvement in medium and long-term results). While the importance of collaboration may seem obvious, implementation is often difficult and complex. Neither with you nor without you: a relationship that does not walk. Many retailers and manufacturers believe that most collaboration initiatives have not worked due to a lack of commitment or interest from the counterparty. When we take a closer look at what's going on and talk independently with each side, we find deep frustration at the inability to make the relationship work on their terms. We hear phrases like "the client always does what he wants", "does not comply with what was agreed", and "does not collaborate". THERE IS A CLEAR IGNORANCE OF THE BUSINESS MODEL, STRATEGY & NEEDS OF THE COUNTERPART Retailers: The retailer thinks in terms of store performance, categories, and SKUs. The retailer thinks about how to bring more Shoppers to his store, how to increase the value of the sales ticket and reduce costs. The retailer thinks about increasing the gross margin and markup by category and product. The store space is the unit to be maximized in terms of billing and profitability. Every m2 counts! The retailer makes comparisons between providers in the same category. Manufacturers: The manufacturer thinks in terms of the volume and profitability of a market The manufacturer thinks about how to increase volume through physical and digital channels and stores Some manufacturers have decided to open a digital direct sales channel to Shoppers, which places them as competitors of their main retailers. The manufacturer sees the commercial conditions as a “cost of sale”. The manufacturer tries to maximize the Gross Margin for every 1,000 units sold. The manufacturer makes comparisons between stores, channels, and regions. TOGETHER they win when they focus their attention on The Shopper. Both parties rely on the Shopper to grow their business while relying on each other to effectively influence their buying behavior. Retailers: They own the information of the SALES TICKET by Shopper. They also have information about specific customers registered in loyalty programs. They are responsible for the Quality of the Shopping Experience and retail execution. Manufacturers: Owners of the main categories and brands desired by the Shopper. Responsible for the control of the logistics of dispatching the product to the store. Manage a lot of information about market, consumer, and purchasing trends by category and channel. Professional support of advertising agencies and market consulting. It has to benchmark information of similar stores. How does TMC contribute to the Joint Business Planning process? Based on our experience, we offer support to manufacturers or retail chains who are interested in building Joint Business Plans for the most relevant categories to speed up their business growth. This job is carried out in four steps driving effective collaboration: Written by Carlos Ignacio Alfonzo, managing partner of TMC Consultores Comerciales. If you are interested in learning about TMC's consulting or training products in this area, write to us at contacto@tmcconsultores.com and we will immediately contact you. If we are not yet connected on LinkedIn, it will be a pleasure to have you in my network of contacts. If you want to evaluate the Shopping Experience of your customers in your strategic stores, write to me at cialfonzo@tmcconsultores.com and we will schedule a meeting.

Many organizations think they are correctly applying store or customer segmentation models. What they may not be aware of is that they may be applying traditional models that tend to be quite limited, static and inflexible. Changes in the behavior of the Shopper, like the ones we are currently experiencing, go unnoticed due to the lack of updating and rigidity of the system. Is your company at the forefront or in the rear? Today, organizations take advantage of existing data like never before, through Machine Learning (ML) technologies and practices, which allow them to generate dynamic store segmentation models, which are not only updated day by day, but also strengthened. and they improve over time. For the Consumer and Retail industry, a successful and effective strategy aimed at the Shopper begins with an adequate Store Segmentation. Whether for Trade, Retail or Shopper Marketing initiatives, we must seek to establish, among other variables, the profile and the predominant purchase mission of the Shopper in each store, to optimize our efforts and maximize results and returns on our commercial investments. Companies like Coca Cola, Diageo or Walmart have already known the great advantages that are obtained by taking advantage of Machine Learning in their Store Segmentation models. In previous articles we have already talked about the importance of having a robust segmentation model and also how to segment stores based on the Shopper's profile or mission. What is Machine Learning and why is it key in Store Segmentation? Machine Learning, also known as "Automatic Learning", is a subfield of Artificial Intelligence that seeks to solve "how to build computer programs that improve automatically by gaining experience". It does this by adapting certain algorithms to its programming, in order to reduce the need for human intervention. This can be a great advantage when it comes to processing and controlling a huge amount of information in a much more effective way. From a commercial point of view, algorithms allow, for example, to analyze hundreds of variables of any dimension of the buyer persona, profile, or purchasing behavior, and include them as valid attributes to find natural groups of customers or stores. Store Segmentation with Machine Learning Being able to associate the purchase of certain brands and references (SKUs) to shopper profiles and/or purchase missions allows us to create differentiated store segments where these two variables intersect. These models work in the same way for stores of any channel: modern, traditional, proximity or digital. In the end, in our system we will have the stores of the traditional channel, for example, distributed in a matrix. Advantages of Dynamic Store Segmentation In addition to better satisfying the target Shopper, optimizing the assortment, store space, trade marketing investment in promotion and merchandising, focusing and simplifying the operation of sales and field teams, expired products are also reduced, among other advantages. . Among the results achieved are: acceleration in the sales of strategic brands, increase in average billing per store, increase in market share, profitability and increased trust with the customer. Improves Over Time Unlike traditional store segmentation models that were prone to rapid obsolescence with limited possibilities to determine changes in purchasing behavior, the use of ML allows the algorithm to "learn" over time, making it more and more accurate and effective. The new store openings allow quick assignment to a segment or readjustment of stores to another segment due to changes in purchasing habits or shopper profiles. That is, the system is highly dynamic, automatic and without human bias. Conclusions The commercial functions of Retail, Trade or Shopper Marketing now have ML technologies at their fingertips that will allow them to take advantage of existing information to segment stores, be they physical or digital, in order to focus initiatives and strategies. of the brands where the target Shopper is and the predominant purchase mission.

In recent years, Augmented Reality (AR) has been discussed and evaluated as an "Interesting Concept" to be explored in various retail segments, but now it is an "accessible reality". Here are some specific examples of the use of Augmented Reality in various retail segments. AR came to help physical retail improve the shopping experience, to defend itself and compete with e-commerce, reducing in-store product abandonment rates, purchase decision time, product returns and at the same time, help increase sales in strategic segments. As if that were not enough, the tool is very useful to attract a younger audience to the store. There are certain questions that the Shopper wants to ask that are difficult in the physical world, such as: How did other people evaluate this product? While Shoppers can find this information online without the need for an AR app, having it conveniently available in-store helps bridge the gap between the physical and digital worlds, creating a more convenient and consistent experience. facilitating the selection of products, reducing queues and operational costs, INCREASING THE PROFITABILITY OF YOUR BUSINESS. Today, nearly 70% of shoppers research information and compare product prices on their cell phones while they're walking through physical stores. Imagine for a second that your store is full of customers and without the ability to serve them properly. Imagine the typical shopper in your store in front of the planogram with many product options and not sure which one to choose. Most likely, this buyer, after waiting so long to be served or thinking about existing alternatives, will simply leave the store without buying anything or, at best, take the cheapest product. Scary, right? It has been shown that the level of anxiety of new generations the first time they visit a physical store is much higher than during the same experience in the online world. In general, the elements most mentioned by Millennials to justify their preference for the online world are the long queues and delays in the purchase and payment process, the difficulty in locating products within the establishment and, finally, the selection of the appropriate SKU without the help of third-party evaluations. SOME AR APPLICATIONS INSIDE THE STORE The physical store takes advantage of the digital world in the convenience of receiving the purchased product immediately. Therefore, we need to reduce the other anxiety-generating factors, such as lines to weigh products or pay, facilitate the location within the store and the process of selecting the product on the shelf, without increasing the cost of operation. Augmented reality can help in this challenge FASHION Lacoste's LCST Lacoste AR app allows customers to try on shoes virtually without having to interact with anyone: since its launch, more than 30,000 users have tried on its products on the app. COSMETICS Sephora, in the cosmetics industry, created a virtual artist app with Modiface to show its users how makeup products will look on their face through the phone's camera. WINE AND BEER The use of AR in product labels (for example, craft beer, wines and spirits) allows to communicate the most relevant attributes that can help the Buyer in the difficult selection process at the front of the shelf. Now it is possible to efficiently convey interesting stories about the product, the producer or even implement exclusive promotions and provide tips for preparing dishes and cocktails to the target audience. CONSTRUCTION Home Depot launched its app to ease the selection process for the purchase of tools and products with technical specifications, which are often difficult to choose without the help of an experienced employee. Now, when the staff is busy, the Shopper can directly access the app to get the recommendation of which product to take immediately to meet their needs. Better than the online store, right? UTILITY AS A COMPLEMENT OF THE SHOPPING EXPERIENCE OUTSIDE THE STORE DECOR Magnolia Market has partnered with the Shopify AR team to create an app that allows customers to see what the brand's products will look like in their homes. Augmented reality helps customers visualize Magnolia Market products to decide if the products match existing furniture or fit well in the room. DECORATIVE INKS Wallpaper retailer Graham & Brown launched its augmented reality app this year, which allows users to try out all available options right in their living room and order the product through the app. AR technology considers lighting, objects, and shadows in the room, so you get a realistic image of what the paper will look like in real life. AR apps from these retailers also allow users to send images via text or on social media to get feedback from friends and followers before making a purchase. FURNITURE IKEA has just updated its Place app so users can try out multiple decor pieces individually or together in a room, instead of just one at a time. Once you have purchased the product, the augmented reality experience does not end as you will be challenged to assemble the products following the instructions. It's easier now, as the company has finally introduced instruction manuals that also work with augmented reality, so these black and white illustrations become a bit easier to understand. FASHION Timberland used augmented reality to engage customers, allowing anyone to imagine themselves wearing any branded piece from the store window, the bus stop, or the subway station. In all these cases, physical stores are always necessary as a showcase for the real product (showrooming) or as a logistics point to pick up online purchases. Augmented reality is being used to remove negative emotions from the buying process in physical stores, greatly improving retail profitability. You do not need to create an application exclusively. Today, you can use platforms and applications on the market that are perfectly suited to your needs, such as AUGMENTED or NEXTECH. And in case you already have an app, even if it is for other purposes, the recommendation is to add augmented reality in the next update. Remember that if the trend continues, very soon more than half of all online retail sales will be done through mobile phones.

It is essential to have effective and efficient Go To Market (GTM) models in emerging markets, since to a large extent, the profitability of the company, the adequate provision of services, and the effectiveness in reaching target consumers will depend on it. In developed countries, companies can direct their efforts and resources to modern, concentrated, organized, centralized retail with high levels of standardization (known as a modern or organized channel). This allows companies to establish structurally simple GTM models with little need for variants to cover a high percentage of the market. However, the emerging countries, despite the fact that they tend towards a slow but inevitable change, continue to be dominated by what is known as traditional trade. Today in Latin America, for example, depending on the country, the sales of consumer companies through this channel can vary between 30% and 70% (even higher for certain categories) of total sales. Although we have grouped everything into a large channel, the reality is that it can be very complex from the point of view of the diversity of existing formats. For some of our clients, we have generated classifications with more than 30 types of business between those of immediate consumption (on-premise), those of subsequent consumption (off-premise), and those that present both types of consumption. It is a very fragmented channel and each of these formats has very particular and dissimilar characteristics. The Objectives of Channel Management Despite the differences described above between developed and emerging countries in relation to the characteristics of their retailers, the objectives of the companies are the same: profitably maximize business coverage and product availability to target consumers, ensure retailers loyal influencing shoppers and having the possibility of implementing commercial initiatives of merchandising, exhibition and promotion, among others. To achieve these goals in emerging markets, several and in some cases complex GTM systems are required. The level of complexity will vary depending on several factors: the breadth of the portfolio of categories and brands and the synergies that exist between them, the level of fragmentation of the types of business where they are marketed, geographical characteristics (logistical aspects), the level of development of the existing distribution channels (distributors, wholesalers, cash & carry, stockists, etc.), levels of coverage and control required and last but not least, the competitive position of the company in the different categories where it competes. The Traditional Channel In this channel, consumer companies must work with a large number of small independent stores. These customers have limited working capital to purchase goods, limited space for product storage and display, and are expensive to serve. The only practical way to reach many of them is through a fragmented network of agents, distributors of various kinds, and wholesalers. This complex distribution landscape reduces the margins of all channel partners and reduces the upward flow of market information and company visibility. Traditional distributors and wholesalers can also be difficult to manage. They typically focus on higher volume categories and brands rather than market development. In most cases they tend to be passive order takers rather than brand advocates and developers. It tends to work well for Active brands in terms of distribution (strong brands with medium or high shares within their category), but very ineffective for Passive brands. Let's analyze the channel through a real case An important client of ours in Latin America that has maintained sustained growth over the last few years decided to comprehensively evaluate its GTM model. This company, through acquisitions and own developments, has multiplied by four the number of categories where it competes and similar numbers for the total references (SKUs) it sells. The number of direct customers served by the company has doubled (although not its sales force). At the same time, it has seen how, as the intensity of the fight in the channel increases, it becomes more difficult every day to ensure availability and space for its broad portfolio of brands. Many of the new brands have failed to establish themselves consistently in the channel and are already starting to divest from some of the new categories. Over the years, the company has developed a solid and sophisticated model of direct sales to customers in the modern channel and those with the highest volume in the traditional channel. However, in the evaluation we carried out we detected some problems: The large number of businesses visited daily by the FDV limits its possibilities of doing an adequate job, especially for medium or low turnover categories/brands (passive brands in terms of distribution). These businesses served directly are the same customers that were served since the establishment of the current GTM model. However, other types of customer segments relevant to the new categories have not been incorporated. In these new categories, the company does not have strong leadership positions as in its traditional categories The cost of serving is very high for various customer segments (negative profitability). Limited understanding of the organization of all these problems due to an inadequate Classification and Customer Segmentation Model (see my post related to this point: Why is an adequate Segmentation of POS essential?). The second level of clients with the highest volume of the traditional channel is served by a network of distributors with territorial exclusivities. These distributors were also conceived and contracted based on the original categories and brands of the company. They have been "forced" to market the new categories and/or brands over the years. In the diagnosis that we carried out, problems similar to those mentioned above were detected with the direct FDV of the company. For example, one of the new categories that is considered strategic by the organization has obtained results far below expectations. The fundamental reason is that this category requires coverage and availability in segments of shoppers (adolescents) and types of businesses (kiosks, convenience stores and immediate consumption businesses) where the current network of distributors does not reach with sufficient strength. The rest of the market (30% of sales volume) is served through the network of local wholesalers. The new Go to Market models Once these weaknesses were understood and quantified, we developed several GTM models. We had to initially design a new robust customer classification and segmentation. The direct sales model was maintained through vendors only for the largest/strategic customers of the channel, reducing the number of daily customers; a new teleshopping model (possibly replaced or supplemented by e-commerce in the future) was created for average customers, where previous relevant service levels could be maintained but with a lower cost of serving; a third level of customers with negative profitability was transferred to the distributor network. On the other hand, we created new models of distributors by Category/Channel/Territory that are much more focused and specialized. For two of the new strategic categories, for example, a network of small exclusive distributors was created for the convenience channel and kiosks where the distributor was required to have the company's brands at least 50% of total sales. After about three years of having implemented these new models, we can summarize some of the main achievements: 1. Large and medium direct customers are and feel better served (customer satisfaction study) with a much more focused FDV. 2. Increased commercial profitability by transferring customers with low sales volume (drop size) to distributors. 3. Significant improvements in availability, visibility, sales volume and market share in the new categories and strategic brands with higher added value. 4. Effective entry into new business formats. 5. Some of these initiatives have been considered as internal "best practices" and have been exported by the company to other markets in the region. Some conclusions This case exemplifies the complexity of the traditional channel and how as the categories marketed increase, the level of trade fragmentation and the intensity and competitive position (total and by category), among others, will mean the development of alternative models that ensure the desired position in the different target customer segments. Successful models of the past are no guarantee of success in the present. Many companies organically develop very effective GTM models in certain customer segments, but as new players grow or enter and intensify the struggle in the sector, in-depth reviews of the model are required to ensure that they continue to be valid and profitable. Any adjustment or development of new GTM models will additionally entail reviews of internal organizational structures (both sales and commercial logistics and trade marketing and merchandising support), design of new management and operational process models, possible new metrics of management control (especially associated with the cost of serving) and a commercial team with the knowledge and skills to manage this new complexity. And by the way, the modern channel in emerging markets also has some peculiarities that differentiate it from that of developed markets. But we will see that in a future installment.

The main questions we must answer to build a Go to Market (GTM) strategy are: How does your company interrelate with your intermediate and final customers? How do you deliver distinctive value to your target customers, consumers and shoppers? How do you ensure appropriate service levels for each customer segment? How do you go from the initial connection with a potential customer to the fulfillment of your brand promise? We can define the GTM strategy as the design of sales and distribution channels that companies require to sell, dispatch their products and serve their intermediary customers to reach, retain and develop their multiple segments of end customers, consumers and/or shoppers. Starting from the premise that our products and/or services have already been clearly defined and/or are already established in the market (they have a clear positioning and target markets, marketing mix, etc.), we must develop or adjust the strategy of GTM to reach our end customers in the most effective and efficient way, be they other companies (B2B) or end consumers (B2C). Benefits of a strong GTM strategy A robust GTM strategy offers a host of benefits: Define clear service levels by customer segment and channel Reduce time to market Increases the ability to adapt to change Increases product availability and visibility Improves launch management of challenging products Reduce costs associated with failed launches Ensures the effective experience of the client, consumer or shopper Ensure regulatory compliance Set the path for growth Clarifies the plan and direction for all Considerations for the Go To Market Strategy There are some initial considerations to take into account in the design process of our strategy: Market Potential and Accessibility Barriers The first analysis in the design of the GTM strategy is to determine both the potential of a market (sales projection), and the ease (or difficulty) of accessing the different customer segments. For example, how complicated and expensive it can be to distribute our products in the traditional mass consumer market or to penetrate the large accounts of the modern market. These elements will be of vital importance in defining the sales channels. Channel Development and Competitive Strength The current level of development of the channels, for example, concentrated markets (normally in more developed countries) vs. fragmented markets (less developed countries), will have a significant impact on the possibilities of sales channels to use. As we wrote in our post Why are complex Go to Market models required to win in emerging markets? In emerging countries, we have to understand the diversity of what we have grouped as the Traditional Market, where there is a wide variety of formats and types of business with characteristics, possibilities, and limitations of each one. On the other hand, our competitive strength (measurable by the strength of our brands or how active or passive they are in terms of distribution) will have an important impact on the possible models to use. Service Levels Required by the Channel To the extent that intermediate customers (retailers, distributors), as well as consumers and shoppers, become more demanding, they are generating more pressure on manufacturers in terms of service levels required in order to compete. Services are costs, so understanding these demands in each customer segment will be of vital importance for our value proposition to be competitive, but at the same time profitable. Corporate and commercial strategy: The Go To Market strategy cannot exist by itself. It is the means to implement Channel, Category, and Brand strategies. That is, to put the GTM strategy in context, other trading strategies must be considered. Obviously, all these strategies that feed GTM derive largely from the corporate strategy itself. Identify Go To Market Options: The next step in the process is to identify the options available or to be developed to reach a market in general or only target customer segments. The markets, apart from the aforementioned level of development, have different characteristics (geographical, technological, tax, regulatory, etc.) that limit or boost the possibilities of reaching our target audience. An accurate identification of options allows us to evaluate the pros and cons and the costs of each of these options. Generally, a strong Go To Market strategy will involve using different options for different market segments. The final objective is to have the correct combination of two fundamental variables: Sales and Distribution. And the decision of who does the Selling and who does the Distribution is based on two important criteria: accessibility and sales potential of the client. Clients with difficult accessibility and low sales potential will tend to be served indirectly, while clients with high sales potential and greater accessibility will be served directly. For intermediate clients, we will have combinations as we can see in the following table: Cost to Serve Analysis Each identified option has a cost and we must understand its magnitudes in the two relevant variables. Commercial terms Logistics cost Quoting Phillip Kotler “we can say that a physical distribution system is efficient when no logistical reorganization of factors can reduce costs while maintaining existing service levels”. In other words, our GTM model must seek the greatest efficiency (the lowest possible cost with the required service levels) for each channel or customer segment. Model Characterization The next step is the characterization of the model. Among some of the topics that we must develop here are the following: Vision and medium-long term objectives of the model. Service levels by customer segment. Value offer. Desired levels of standardization. Commercial conditions (margins, credit, counterparties, etc.). Operational and logistical requirements for the distribution of the category/products. General profile and financial requirements of Distributors and/or Logistics Operators. Contractual and tax guidelines and considerations. Information systems. The Commercial Organization Finally, with the definition of the GTM model, we must define the organization that we require to be able to operate it. Any review of the GTM strategy requires an organizational review. In other words, the way we have decided to reach our target customers will have an impact on our organization; organizational structures, job profiles and skills, work processes, and training. In conclusion… As we saw at the beginning of the post, the GTM strategy is of vital importance for any organization, since it gives an answer to how we reach end customers in the most efficient way and how we serve our intermediate customers. Markets are changing faster and faster (clients, consumers, shoppers, competition, etc.) and in this sense, the review of the GTM strategy must be done more frequently than in the past to remain competitive and relevant. If you are interested in discussing some opportunities in this regard for your business, do not hesitate to contact us.

A recurring question that we are asked in different forums, courses, and also by some of our clients, is what is the correct way to structure Trade Marketing. After many years of diagnosing and designing organizations for companies of different sizes, industries, and markets, the truth is that I think that the structure is more or less irrelevant if other elements are not defined and developed, of equal or greater importance than an organizational chart, to achieve a world-class Trade Marketing organization. Let's see them one by one. Define the Role of Trade Marketing in the Organization A large number of diagnosed cases present very little clarity from top management about what the role of Trade Marketing is. That is, we obtain limited answers to some critical questions such as: What do we want them to do? How strategic and/or operational should the function be? Do you manage your own budget or do you depend on the brands to be able to operate? Do you lead the planning and implementation of commercial actions in the channels? Are you responsible for Shopper Marketing? etc. Clarifying these and other points helps from the beginning to define the role of the function and this, in turn, will help us define the appropriate structure and, above all, the required job profiles. Additionally, it will allow to design clear processes minimizing gray areas between Marketing, Sales, Trade Marketing, and other functions of the organization. Focus the team on the Shopper, the Channels and on generating Insights A deep understanding of what Shopper Marketing is and how it is implemented in the organization will be vital to ensure superior performance. Make sure the T.M. be focused on knowing the Shoppers, the Channels and generating relevant Insights to develop Trade Marketing Plans aligned with the Marketing and Sales Plans. Trade Marketing should not be a machine conceived only to carry out activities that rotate stagnant products on customers' shelves. Design work processes incorporating the best practices of the market Perhaps the main difference we get between the companies considered to be the best performers and the average ones is that the former are extremely disciplined in the things they do. They achieve this discipline first by designing and formalizing their processes (also in these cases, both strategic and operational), where best practices adapted to their businesses, markets, channels, etc. are incorporated. and the required management indicators. Well-designed processes allow, in turn, feeding the Position Profiles, defining specific responsibilities for each position in the function. They are then extremely disciplined in ensuring that those processes are carried out as designed. There is a very high adherence to the established tasks to carry out any commercial activity. Define Charge Profiles in line with what is expected Many Business Directors care a great deal about the structure and are continually adjusting it, achieving in many instances veritable patchwork quilts. I wish they cared more about developing strong job profiles. That is, define: roles, responsibilities, and profile of both technical and leadership skills. The lack of clear, well-defined, and in line with the expected role of the job profiles function is one of the main barriers to achieving a strong Trade Marketing organization. Recruit from within and without The strongest and strongest Trade Marketing departments I know of are made up of mixed teams of internal and external resources. Integrating knowledge from other categories and channels with that of our own organization will generate synergies and possibilities that are difficult to achieve with only internal personnel. Leverage in Trade Marketing to develop Commercial Managers If the role of Trade Marketing lies in being a manager (both strategic and operational), between Marketing and Sales, a combination of knowledge and real experiences of Brand Management and the world of Retail, possibly produce the strongest alloy to achieve superior performance. . Giving Trade Marketing the importance it deserves and making the role aspirational for members of other business functions will be of paramount importance. Career Plans in this sense, become processes of lateral rather than vertical movements, achieving at the end of the day Managers and Directors with extensive Commercial experience (Marketing, Sales and Trade Marketing). One of our clients, which in my view has one of the strongest business organizations, has developed a tremendously successful Income and Career Planning model. Most of the new hires enter through Trade Marketing at the assistant level (some also in Key Accounts) and from there lateral movements are generated with Marketing and Sales. At the end of the day, we have a team that knows the realities (work methods, problems, opportunities, limitations, etc.) of all business functions, generating synergies and cross-functional support that we do not see in many other organizations. They have made Trade Marketing the seedbed that feeds the other business functions. Design a training and development plan With the role and objectives of Trade Marketing established, the profiles and critical competencies by position that we have defined, and the new processes formalized, we can carry out the analysis of gaps between what we require from our team and what we have. This will allow us to plan the necessary incorporations and training that will ensure that we enable the team with the required skills. There are obviously other factors to achieve a solid Trade Marketing organization, but I believe that what has been stated, are the necessary foundations to achieve it.