Managing Trade Data During M&As

It's no secret in the consumer goods space that acquisitions are a viable and often profitable strategy for growth. These strategic building blocks have brought together some of the most iconic brands and formed industry powerhouses.

But the realities of bringing two distinct organizations together also means bringing together unique systems and data configurations that can stall any immediate gains anticipated as a result of the acquisition.

Nowhere is this more true or potentially more costly than in the area of trade promotion, where it's likely that the individual organizations already have made significant investments — and very little visibility into data insight or return. This obstacle often paralyzes merging organizations as they wait to bring together complex systems such as ERPs and TPMs.

These foundational order and trade management systems will be critical to operations as the organizations turn from two into one, but their functionality is not imperative for gaining valuable insight into both organizations’ trade investment health and, thereby, into brand or product sustainability. Accomplishing this in a timely manner requires approaching the challenge not as a systems issue, but as a data issue.

Data issues require management and harmonization of disparate data sets, while system issues require integrations and network configurations. This is important because, when it comes to trade promotion, a comprehensive optimization solution already has capabilities in place to harmonize disparate data sets. So companies can quickly turn their data mess into a single view of the connected organization's trade promotion activity.  

In doing so, it's possible to quickly evaluate both promotional activity and the base business to analyze historical trends and anticipate future fluctuations. Typically, such in-depth analysis is relegated to spreadsheets that take analysts unfamiliar with the new business an extraordinary amount of time to reconcile for a limited number of retail customers. Bringing this data together in a single database not only saves time and eliminates common errors of spreadsheet dependency, it also allows for analysis of all customers on an ongoing, real-time basis.  

This new common visibility into trade analytics allows for a visualization of post-event performance data that can be shared with key decision makers, as well as field sales, to make important decisions about the new joint product portfolio. As a better picture of the combined organization’s trade promotion health comes into focus, it will be easier for business leaders to facilitate the process changes that will insure the efficiency and future productivity of activity. This is in large part because there will be a clear tie between data insight and company objectives.

This is also where organizations can transition from a combined understanding of trade promotion performance to considering how the insights gained during post-event analysis can drive future planning. While the acquiring organization may have a satisfactory process for trade planning, there is an opportunity to evaluate such elements as price points, promotional tactics, corporate guardrails to maximize individual events, customer plans and even their expanded product portfolio. Furthermore, this data-centric approach to trade promotion can align internal stakeholders (sales, marketing, finance) under one version of the truth.

Strategic acquisitions present enormous opportunities to strengthen the financial foundation of a consumer goods company and position it for future growth. Making these moves part of ongoing revenue growth management will require quickly overcoming disparate data obstacles to gain important insights that will guide decision-making. Failure to do so can not only delay evaluation of the acquisition's impact, but can also threaten the agility and potential profitability of the organization.

The ability to confidently manage the holistic trade investment with predictable, quantifiable returns over time puts in place a revenue management focus that can position an organization to enact the strategic assessment and execution that has often been retroactive in merger and acquisition scenarios.

Terry Ziegler is chief executive officer of T-Pro Solutions. He has more than 30 years of consumer packaged goods management experience in the areas of trade marketing, consumer marketing, category management, sales and finance. His professional experience includes leadership and management roles at RJR/Nabisco, Borden Foods, Dairy Farmers of America, Synectics Group and AFS Technologies.