CPGmatters: Can Mobile Marketing Rejuvenate Trade Promotions?
By Al Heller
Through a special arrangement, presented here for discussion is
a summary of a current article from the monthly e-zine, CPGmatters.
rising discipline of mobile marketing brings with it a chance for retailers
and CPG suppliers to usher in a new consumer-centric era of compelling, creative
trade promotions that step up discounts as individuals engage more with specific
brands and stores.
Buy more of a brand, or shop more at a store, or use a cell
phone to pass along articles about, say, fabric care from a detergent manufacturer,
and a consumer could receive extra savings rewards from manufacturers and retailers.
cool is that? It could be mighty cool for brands that market directly to consumers’ cell
phones as they build their shopping lists or are actually in the stores.
"Tech-enabled shoppers of every generation, but especially younger shoppers,
use cell phones and PDAs increasingly to buy smarter and save. The action is
in the store. That’s where to communicate because conventional media
are fragmented to the point where those buys are less effective for brands," Wayne
Spencer, senior vice president-business development, Synectics Group, told CPGmatters in
With mobile trade promotions, he said, the industry is starting
from scratch with a clean slate to distance itself from the wasteful, sub-optimal
merchandising patterns of the past.
"It’s critical that retailers and CPG collaborate to reach a single
sophisticated view of the truth that both sides can mutually act on. This shared
view fosters a collaborative environment, which will inevitably result in incremental
profits and volume on the in-store merchandising investment," Mr. Spencer
"If we do this right, mobile marketing will probably rejuvenate trade
promotions. If we don’t, CPG margins will continue to erode. We need
to move far away from where trade promotions have devolved. Consumers are bored
to death with promotions today. They’re zombies who look for the lowest
price. This doesn’t
help the retailer or the brand," he insisted.
Here is a good example of
trade promotions in the future: Blended promotions between name brands and
complementary private label products, such as pasta and sauce, or meats and
breads, or milk and cookies. In Mr. Spencer’s
need to realize that private label isn’t going away, and stores need
to maximize category penny profits with the correct blend of brands and private
label. They need to co-exist, augment each other, and focus on serving consumers
with the shared goal of enhancing their in-store experiences."
"The funds for mobile marketing and social networking [today] will most
likely come from the advertising/consumer marketing budgets, rather than from
trade promotion budgets, because CPG controls less of the latter than they’d
like," he added.
Discussion Question: How do you think mobile technologies will affect trade
promotions? Do you see retailers and manufacturers recognizing mobile as an opportunity
for beginning a new era of collaboration "from a clean slate"?