Client background

• A leading consumer products company ( CPG ) whose products are marketed in over 200 countries throughout the world
• Market leader in the following business categories: oral care,personal care, home care, and pet nutrition
• The company has operations in North America, Latin America, Europe, Asia Pacific and Africa/Eurasia

Challenge

Like many CPG companies, the client was trying to find the right trade spend and retail pricing investment levers to unlock profitable growth. Through consolidation, retailers have put downward pressure on overall profit margins through deep discounting pricing strategies. This market dynamic may achieve short-term sales volume acceleration for both the retailer and the company, but quite often these sales spikes work against long-term profitability. Over time, constant discounting to drive sales growth can cause an erosion in brand equity, which makes recapturing competitive profit margins even more difficult. The client wanted to protect their brands from the dual threats of excessive price discounting and private label competition. In order to adapt to these challenging trends, there was a need to optimize their trade promotion and pricing strategies.

Business requirements:

• A platform to support extensive data transformation requirements (syndicated data, retailer POS data, master data, P&L inputs) with varying formats, hierarchy levels and frequency.
• Integration with existing enterprise systems (ERP, TPM, and visualization platform).
• Advanced machine learning framework based modeling capabilities.
• Pre-built templates to provide visibility to key KPI’s to support global design approach, yet can be configured to meet market-specific requirements.

Solution

The Promax Optimize solution provided our client with the data transformation and insight-driven planning capabilities required to shape demand and drive profitable growth. The Promax Optimize solution combines industry-leading predictive modeling software, in a machine learning based framework.

The Wipro team provided expert training, management consulting, data management and data sciences support to the client. The Wipro consulting team played a very active role in helping the client navigate various challenges and successfully achieve the desired business outcomes. This partnership led to a high level of satisfaction and user adoption.

The client decided on a quick three-month pilot to deploy Promax Optimize for their UK operations; initially to support their largest retailer, and then add seven more retailers over time. Driven by the success of the initial pilot, the client has now deployed the solution to seven more countries, covering the business for an additional 20 retailers. The pilot phase provided a global template design that was quickly adapted, and modified as necessary, for the new markets.

Solution highlights include:

• Visibility to predictions and causal influences (price) on consumption and activity demand
• Visibility to net effect of promotional activity on the bottom line
• View of manufacturer and retailer margins and ROI
• Visibility to the performance of promotions across time, and market share of client against competitor products across multiple dimensions
• Category evolution view, providing visibility to the decomposed retail sales of the selected products over time

Busines impact

Through this successful deployment, the client now has a stable, and repeatable process, to measure and optimize trade promotion ROI across their business.

• Improved net sales revenue by over $1Mn, and net margin by over $1.15Mn, after the first six-months of deployment
• Increased total revenue by $3Mn after six months of deployment
• Highly accurate models, driven through machine learning framework and the collaborative planning approach, yielded high levels of user adoption with the solution

The Promax optimize solution has enabled cross-functional teams of the client to have better discussions on promo strategy, promo priorities by brands, brand platform tactics, etc. The tool brought in a ROI mindset in the departments involved, based on which potential action plans have been laid out.

Visit our website https://promax.wipro.com/. Email us at WPAS-Promax@wipro.com