Hain Celestial Goes for Maximum Promotional Impact
The Target team at Hain Celestial Group Inc. (www.hain-celestial.com) was in a promotion rut — same discounts, same ideas, same number of weeks. With a limited trade budget, the team wanted to determine if they were spending those dollars wisely. And, if not, where those dollars could be better spent.
“Most CG companies only look at lift without considering how incremental costs affect their incremental dollars. They don’t have the software to help them set benchmarks,” notes Jeff Schonhoff, director of Sales-Target, Hain Celestial Group, Inc.
Using the SOLYS Demand Intelligence Solution from LumiData (www.lumidata.com), Schonhoff now has the ability to do just that. For example, when he suspected tea category promotions weren’t performing, he imported point-of-sale (POS) data into SOLYS and looked at sales on a weekly basis year-over-year to identify category trends and target the weeks with highest sales.
“In the past, we’d run the same 10 percent temporary price cuts (TPC) for six weeks. I ran an analysis of every promotion from the previous year so I had a baseline for comparison. To determine the true lift, I incorporated the costs of running the promotion,” he explains. “After reviewing the data, I proposed cutting the discount to 5 percent and running the TPC more often to drive more volume. We ran the 5 percent TPC earlier in the season for two weeks and SOLYS instantly showed me the lift, incremental cost and my incremental gain. We could see it was working.”
“We ran the 5 percent TPC for 10 to12 weeks and had almost as strong a lift. We realized we had name recognition and that if the item was flagged, they’d buy it at a lesser discount. We had proof we could drive more volume because the discount amount didn’t matter.”
Schonhoff did the same analysis for personal care. “Most of the promos were returning a lift below 1.5 or 1. So do we invest in tea promos because they perform better? Or could we improve the personal care promos?”
At first, it seemed to Schonhoff that the personal care promotions weren’t working.
“But when we looked at a variety of segments, we found some performed very well. Because we knew which segments were worth promoting and which weren’t, we could look at other ways to spend money and improve sales.”
Instead of running a TPC, Hain Celestial is testing gift card and receipt marketing options. When the promotions end, SOLYS will immediately tell the company if it was a smart lift.
Today, Hain Celestial’s new way of doing things is improving relationships with retailers.
“If a buyer expects us to run a promotion and we have to run it, we can demonstrate why we shouldn’t continue doing so or how we should change it. If we need to run a poor-performing promotion to block the competition, we can demonstrate why that’s smart.”
“We’ve been able to convince Target to change our promotions because we have the data to demonstrate it works. They see that we’re not taking money away from them, we’re just shifting our spend so we both gain.”
Fast Facts
Company at a Glance
The Hain Celestial Group is a leading natural and organic products company in North America and Europe.
Well-known brands include Avalon Organics, Celestial Seasonings,
Earth’s Best, Terra, The Greek Gods, and many, many more.
Words of Wisdom
“We can break old habits in our promotions — we have the option to explore and improve sales and volume.”
— Jeff Schonhoff, Director of Sales-Target, Hain Celestial Group, Inc.
Key Areas of Focus
Hain Celestial Group is focused on specific business challenges to achieve maximum impact — determining true promotional effectiveness and identifying new promotional opportunities across segments, categories and retailers.
It Started with Tea
Hain Celestial uses a demand intelligence solution to import and analyze swaths of historical and current POS data to gain insights across its portfolio.
What’s Working Where
Using a baseline smart lift strategy, Hain Celestial works with headquarters to analyze returns across different retailers and allocate trade spend accordingly to drive maximum sales.
“Most CG companies only look at lift without considering how incremental costs affect their incremental dollars. They don’t have the software to help them set benchmarks,” notes Jeff Schonhoff, director of Sales-Target, Hain Celestial Group, Inc.
Using the SOLYS Demand Intelligence Solution from LumiData (www.lumidata.com), Schonhoff now has the ability to do just that. For example, when he suspected tea category promotions weren’t performing, he imported point-of-sale (POS) data into SOLYS and looked at sales on a weekly basis year-over-year to identify category trends and target the weeks with highest sales.
“In the past, we’d run the same 10 percent temporary price cuts (TPC) for six weeks. I ran an analysis of every promotion from the previous year so I had a baseline for comparison. To determine the true lift, I incorporated the costs of running the promotion,” he explains. “After reviewing the data, I proposed cutting the discount to 5 percent and running the TPC more often to drive more volume. We ran the 5 percent TPC earlier in the season for two weeks and SOLYS instantly showed me the lift, incremental cost and my incremental gain. We could see it was working.”
“We ran the 5 percent TPC for 10 to12 weeks and had almost as strong a lift. We realized we had name recognition and that if the item was flagged, they’d buy it at a lesser discount. We had proof we could drive more volume because the discount amount didn’t matter.”
Schonhoff did the same analysis for personal care. “Most of the promos were returning a lift below 1.5 or 1. So do we invest in tea promos because they perform better? Or could we improve the personal care promos?”
At first, it seemed to Schonhoff that the personal care promotions weren’t working.
“But when we looked at a variety of segments, we found some performed very well. Because we knew which segments were worth promoting and which weren’t, we could look at other ways to spend money and improve sales.”
Instead of running a TPC, Hain Celestial is testing gift card and receipt marketing options. When the promotions end, SOLYS will immediately tell the company if it was a smart lift.
Today, Hain Celestial’s new way of doing things is improving relationships with retailers.
“If a buyer expects us to run a promotion and we have to run it, we can demonstrate why we shouldn’t continue doing so or how we should change it. If we need to run a poor-performing promotion to block the competition, we can demonstrate why that’s smart.”
“We’ve been able to convince Target to change our promotions because we have the data to demonstrate it works. They see that we’re not taking money away from them, we’re just shifting our spend so we both gain.”
Fast Facts
Company at a Glance
The Hain Celestial Group is a leading natural and organic products company in North America and Europe.
Well-known brands include Avalon Organics, Celestial Seasonings,
Earth’s Best, Terra, The Greek Gods, and many, many more.
Words of Wisdom
“We can break old habits in our promotions — we have the option to explore and improve sales and volume.”
— Jeff Schonhoff, Director of Sales-Target, Hain Celestial Group, Inc.
Key Areas of Focus
Hain Celestial Group is focused on specific business challenges to achieve maximum impact — determining true promotional effectiveness and identifying new promotional opportunities across segments, categories and retailers.
It Started with Tea
Hain Celestial uses a demand intelligence solution to import and analyze swaths of historical and current POS data to gain insights across its portfolio.
What’s Working Where
Using a baseline smart lift strategy, Hain Celestial works with headquarters to analyze returns across different retailers and allocate trade spend accordingly to drive maximum sales.