Catching up with Peter Hatch, Sr. Director, Trade Marketing Application & Process, RJ Reynolds
CGT Executive Editor Kara Romanow catches up with Peter Hatch, Sr. director, Trade Marketing Application & Processes for RJ Reynolds, to discern how the role of the consumer goods sales representative has evolved. Plus, find out how he deals with pressure to satisfy future consumers in the present.
 | What keeps you up at night? HATCH: The good news is I have no problem sleeping recentlythe bad news is I do worry a lot. The biggest challenge we face today is trying to stay ahead of future consumer trends. As we all know today in the age of quick information (and possible information overload), our consumers are demanding much more from their brands. Within certain product categories, the brands they use are a form of self expression. Consumers make a statement with the car they drive, the clothes they wear, and adult tobacco consumers are the same way. They have their own unique style and taste that they exhibit through brand choices. What I worry about is how to keep in front of the changing wants and needs of adult tobacco consumers, which requires us to be adaptive and flexible all while keeping true to the brand. It's a challenge since we make decisions today about products that won't hit the market for six to 12 months. We need to anticipate those needs and one of the ways we do that is to develop a relationship with trend setters (as opposed to trend followers) among adult tobacco consumers ' to help us identify what they will want from a brand in the future. |
How can manufacturers and retailers better collaborate?
HATCH: Manufacturers and retailers need to understand that consumer needs are different ' that all consumers shopping at Wal-Mart, for example, are not cut from the same cloth. The consumer profile varies depending on geography, location and neighborhood; manufacturers and retailers need to jointly identify the unique customers that are going into those stores and segment products and offerings for that specific store.
HATCH: Manufacturers and retailers need to understand that consumer needs are different ' that all consumers shopping at Wal-Mart, for example, are not cut from the same cloth. The consumer profile varies depending on geography, location and neighborhood; manufacturers and retailers need to jointly identify the unique customers that are going into those stores and segment products and offerings for that specific store.
We are sitting down with retailers and giving them information about their consumers; and they, in turn, need to share information with us. This is a collaborative process that is still evolving. Traditionally, manufacturers have felt that retailers could not sub-segment their outlets effectively or were unwilling to do it because of complexity. There was a feeling that they would want to have all the same products in the Midwest regardless of whether the outlets were in Chicago or Nebraska. But having different segmentations of promotions and product offerings by store and consumer profile better serves the ultimate consumer and hopefully increases sales for trading partners ' it's a win-win scenario.
How is the role of the sales representative changing?
HATCH: I am starting to see a trend in some categories where companies are moving away from third party brokers and merchandisers and putting more and more of their own people in the store to sell programs, promotions and pricing scenarios. That is happening because it addresses the ability to sell multiple promotions differently and the best people to do that are often our own people. Historically, we have had sales reps calling on stores and then merchandisers doing a lot of work at the shelf, but now sales people own multiple geographies and channels ' they're typically not as channel-specific because the industry is moving back to having sales reps own a piece of geography instead of a channel within an area. We will need to take a close look at the sales call processes going forward, as we move back to basics with more blocking and tackling. The sales representative is evolving into a relationship role as much more can be done at store level based on good relationships with local management. It comes down to doing the right thing for the consumers coming into specific outlets.
HATCH: I am starting to see a trend in some categories where companies are moving away from third party brokers and merchandisers and putting more and more of their own people in the store to sell programs, promotions and pricing scenarios. That is happening because it addresses the ability to sell multiple promotions differently and the best people to do that are often our own people. Historically, we have had sales reps calling on stores and then merchandisers doing a lot of work at the shelf, but now sales people own multiple geographies and channels ' they're typically not as channel-specific because the industry is moving back to having sales reps own a piece of geography instead of a channel within an area. We will need to take a close look at the sales call processes going forward, as we move back to basics with more blocking and tackling. The sales representative is evolving into a relationship role as much more can be done at store level based on good relationships with local management. It comes down to doing the right thing for the consumers coming into specific outlets.
What challenges do you face when executing promotions due to RJ Reynold's three-tier distribution model?
HATCH: The challenge we face is to make sure we have good relationships with the suppliers that are servicing key retailers, and that they recognize the importance of getting the right promotions to those outlets at the right time. It's all about collaboration. Therefore, we need to work closely with our suppliers, because they may have incremental complexity in their processes that needs to be understood and managed. The distribution network shares sales data with us today, but we need to better utilize that data to get to consumer insights. CG
HATCH: The challenge we face is to make sure we have good relationships with the suppliers that are servicing key retailers, and that they recognize the importance of getting the right promotions to those outlets at the right time. It's all about collaboration. Therefore, we need to work closely with our suppliers, because they may have incremental complexity in their processes that needs to be understood and managed. The distribution network shares sales data with us today, but we need to better utilize that data to get to consumer insights. CG