Collaboration: Opening the Lines of Communication

As one of the largest full-service sales and marketing agencies in North America, Acosta Sales and Marketing Co. provides outsourced sales, merchandising, marketing and promotional services to consumer packaged goods manufacturers.

Along with that growth, Acosta has positioned itself to enhance relationships with the retailers that sell its clients' products. The company is looking to advanced technology to improve efficiencies in its relationships with retailers and manufacturers. To that end, Acosta is in the midst of a multimillion dollar project to implement a retail management system called CRM Strategy from MEI in Montreal.

Acosta, based in Jacksonville, Florida, provides services including retail execution, category management and order processing to more than 1,600 consumer goods manufacturers who, in turn, sell to retailers such as grocery stores, mass merchandisers, convenience stores, drug stores and other merchandisers.

Consolidation Leads to Growth
The company has grown rapidly because of industry consolidation.

"If you go back six or seven years ago, manufacturers and retailers were working with more sales and marketing agencies across the country," says John Watkins, former executive vice president of business development at Acosta and currently CEO of Acosta subsidiary VeriSync. "Then the number started to decline. Initially this was due to manufacturer consolidation. This forced sales agents to think about expanding their business."

But the real driver over the last five years has been the trend toward retailers, such as Kroger, to centralize their procurement.

"In order to represent a manufacturer to retailers working in different geographical areas, the sales agent community was forced to take a national approach," says Watkins. "Ten years ago there were some 2,500 sales agents nationwide and today there are three that do a majority of the business."

During this period of growth, Acosta has faced both business and technology challenges. On the business side, Acosta has had to deal with resource allocation at retailers. "Many retailers are in a real battle with Wal-Mart to cut costs and protect the bottom line. They are looking for more resources to help them maintain store conditions, and this has been an ongoing struggle," says Watkins.

From a technology standpoint, Acosta sees the emergence of retailers migrating to proprietary solutions that accomplish similar UCCnet functions. "We're working with several retailers to do price and promotions using different proprietary systems. This makes it much more difficult for manufacturers and the sales and marketing agency community to deal with," says Scott McLean, vice president of IT at Acosta.

Another challenge, and opportunity, involves the industry's move toward implementing electronic data interchange (EDI) transactions over the Internet, from using traditional EDI. "We're seeing progressive retailers adopting new standards and mandating manufacturers to comply," says McLean. "They are having to support multiple kinds of standards to communicate with retailers."

A third technology challenge involves the push for more technological innovation. For example, many retailers have begun providing POS data to manufacturers, and as they do this, Acosta will be in a position to help manufacturers get value out of this data.

The retail system from MEI is designed to address some of the technology challenges and help Acosta perform retail execution and other services more efficiently for its clients. MEI's CRM.Strategy analyzes the performance of field sales representatives; manages key performance indicators (KPIs) on out of stocks, pricing, promotion and product compliance; enables field sales representatives to plan and track retail call activities and make adjustments based on the results; and provides additional store management capabilities to increase sales for consumer goods companies.

Rapid Rollout
Acosta began implementation in December 2002 and completed the first phase, a rollout of the system within its Canadian operations, in December 2003. So far the system has been working well, McLean says. Acosta is now in the second phase, a rollout within its U.S. operations, and recently completed a user acceptance test for the U.S. portion. The company plans a pilot test in March followed by a grocery-channel rollout.

One major benefit of the system allows representatives in retail stores to use handheld devices to gather and report data about store conditions. Acosta can download specific questions into the device and the rep uploads answers to a central server used for reporting.

"The system puts SKU-level information at the fingertips of the representative," says McLean. "We can direct new questions to specific stores about authorized products. It also gives us the ability to detail tasks performed in each store." Because the process is automated, Acosta has dramatically reduced the amount of paperwork required for production and mailings. Time is also saved in the data collection process via a single point of entry. Once a question is answered in a store, it's captured electronically and transmitted to a central server.

More Efficient Process
The older technology relied on interactive voice-response technology, and did not allow Acosta to classify questions by category. For example, a retail rep had to go back and forth to different sections of the store to ask questions. With the new system he can go to a department and ask all the relevant questions.

McLean says the rollout of the system is one of Acosta's largest in terms of cost and the number of users. About two-thirds of its employees will be affected by the system by the time the U.S. rollout is complete at the end of this year. Acosta hopes the system helps contribute to future growth.