Trade Management Overview Roadmap 2015

SAP Trade Promotion Management

April 2015

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Legal disclaimer

Agenda

Solution Overview

Solution roadmap

References


Consumer Products Value MapSAP Solutions enable the Consumer-driven Enterprise

Sustainable Innovation Procurement Excellence Responsive Manufacturing The Real-Time

Supply Chain

Brand & Channel

Management

Consumer Dialogue

Brand Management

Trade Management

Sales Management

Procure to Pay with Business

Network Collaboration

Commodity Management

Continuous Products and

Service Innovation

Commercial Project

Management

Integrated Product Development

Product Safety and Stewardship

LEAN Manufacturing

Outsourced Manufacturing

Production Planning and

Execution

Process Visibility & Performance

Integrated Business Planning

Demand Driven Supply Network

Logistics & Order Fulfillment

Supply Chain Monitoring

Omni-Channel Management

Business Network

Extensions for Procure to Pay

Strategic Sourcing & Supplier

Management

Quality Management and

Compliance

FinanceFinancial Planning and

Analysis

Accounting and Financial

Close

Treasury and Financial

Risk Management

Collaborative Finance

Operations

Enterprise Risk and

Compliance Management

People and TalentCore Human Resources

and PayrollTalent Management

Time and Attendance

Management

Workforce Planning and

Analytics

IT ManagementApplication Lifecycle

Management

IT Infrastructure

ManagementIT Service Management IT Strategy and Governance

IT Portfolio and Project

Management

Technology &

PlatformBig Data Real-Time Enterprise Real-Time Analytics Enterprise Mobility

Enterprise Information

ManagementApplication Integration Cloud Solutions

Demand Signal

Management


Where did we invest over the last 10 Years?

Account and Trade Promotion Planning

Trade Funds Management

Trade Promotion Planning

Accelerated Trade Promotion Planning powered by SAP HANA

Integrated Marketing Calendar

Integration with Demand Planning (APO)

Trade Promotion Optimization

Trade Promotion Execution and Settlement

Integration with ECC

Trade Claims Management

Trade Promotion Effectiveness

Retail Execution


Recent Innovations that enable the End-to-End Process

SAP Accelerated Trade Promotion Planning powered by

SAP HANA

In-memory trade promotion planning for end users to plan

large and complex promotions and meet KPIs

SAP Trade Promotion Effectiveness

Analyzes the effectiveness and efficiency of trade activities

and Funds Checkbook

SAP Retail Execution

Empowers Sales Force with mobile tools to optimize and

execute their customer visits

SAP Trade Promotion Optimization

Leverage understanding of shopper demand to predict

future purchasing behavior and financial impacts of price,

promotion, and merchandising decisions

SAP Demand Signal Management

Daily visibility into consumer sales performance (sell-out)


SAP Accelerated Trade Promotion Planning powered by SAP HANA

Improve accuracy of trade

spend allocation

Allocate promotion spend on a

granular day level instead of

by week or month

Accelerate planning of

trade promotions

Run any size of promotion

instantly

Build highly tailored

promotion plans

Glean insights from working with

granular product and SKU data

instead of overall product category


Simplicity

A B

Web UI User interface improvements

Increased usability via features like Multi-cell update and Copy paste from Excel

Accelerated Trade Promotion Planning, Edition for Microsoft Excel

Provides a simplified set of key functionalities for planning trade promotions.

Offers a flexible and familiar platform for targeted users.

Proposes streamlined trade promotion planning activities in one workbook


SAP Trade Promotion Optimization provides visibility

Assess planned revenue, volume and

profitability for the manufacturer and channel

partner

Predict and suggest optimal price and

merchandising decisions based on goals and

objectives

Determine optimal programs and promotions

given planned spend and available budgets

Enable common view on sales baseline

■ Decompose volume – baseline v.

incremental, promoted v. non-promoted

■ Assess impact of promotion activity on

category and customer

■ Monitor model and forecast accuracy

■ Enable common view on sales baseline

Forward Looking Performance

Guidance

Backward Looking Performance

Analytics


Integrate, Harmonize, Provide and Analyze


10

SAP Demand Signal Management, powered by SAP HANA, contains a consistent, centralized in-

memory database that stores, integrates, cleanses, and harmonizes large volumes of data from

disparate data sources, such as Point-of-Sale (POS) data from retailers, as well as market research

(syndicated) data and others.

SAP

TPO

Retailer

POS Social

Media

Market Research

data (e.g. Nielsen)

Distributor/

WholesalerSAP

Business Suite


Linking additional external

information (e.g., weather)


The Value to Your Business

Improved Sales Performance

Develop optimal sales and promotion plans balancing across

volume, revenue, and profit objectives

Elevate your sales team’s effectiveness with easy-to-use predictive

capabilities

Improve sales and promotion plan forecast and accuracy with

automated forecasts and advanced analytics

More Effective Trade Spending

Optimize promotion performance

Fully leverage available budget

Meet manufacturer and retailer objectives

Stronger Collaboration

Transition fact-based promotion planning with retailers from post-

event to pre-event

Demonstrate joint value/profitability with channel partner

Account and Trade Management

Business Processes

Sales Planning & Budgeting

Account & Promotion Planning

Sell-in & Negotiation

Execution, validation & Settlement

Evaluation & Analysis

Response to market activities

Plan Sell AnalyzeExecuteOptimize

Sales target development (volume & value)

Spend quota development

Funds allocation & management

Commercial planning

Price list & assortment

Account volume & revenue planning

Promotion planning

Pre-evaluation

Sell-in with customers

Promotion communication to Field sales

Retail execution activities

Execution

Financial accrual

Claims & settlement

Pay-for-performance validation

Account pre/post-evaluation

Promotion pre/post-evaluation

Market & category analysis

Funds analysis


Account and Sales Planning Process

01 Receive High

Level Targets

02 Break down

targets to planning

Level

03b Baseline +

Assortment Planning

04 Promotion

Planning

05 Review against

targets

06 Handover to

other apps

02a Central Price

and Condition

Planning

03a Account specific

Price and Condition

Planning

Cycle











1.1

Sales Planning1.2 Budgeting

1.3

Deal Mgmt.

1.1.1 Marketing

Alignment

1.2.1

Funds with

budgets set-up

1.3.1 Headquarter

Deal setup

1.1.2

Sales target

development

(volume and value)

1.2.2 Fund Closing

1.1.3 Spend quota

development

1.1.4 Commercial

conditions review

1.1.5 Establish

Promotion

Guardrails

1.1.2.1 Maintain volume target by account & category

1.1.2.2 Maintain monetary target by account & category

1.1.2.3 Agree on volume target by account & category

1.1.2.4 Agree on monetary target by account & category

1.1.3.1 Maintain spend quota per account & category

1.1.3.2 Agree on spend quota per account & category

1.1.4.1 Agree on price strategy

1.1.4.2 Agree on growth per region/account/market

1.1.4.3 Agree on service levels

1.2.1.1 Maintain live rate percentages

1.2.1.2 Maintain fixed funds

1.2.1.3 Agree on live rate percentages

1.2.1.4 Agree on fixed funds

1.2.2.1 Review Accruals / Reserved / balances

1.2.2.2 Relieve unused accruals

1.2.2.3 Relieve unused (pre-) reserved balances

1.2.2.4 Close Fund

Main Requirements

So

luti

on

Gap

s






2.1

Commercial

Planning

2.2

Price List &

Assortment

2.3

Account

Volume/Rev

enue

Planning

2.4

Promotion

Planning

2.5

Pre

Evaluation

2.1.1 Market-

trade

channel &

account -

development

analysis

2.2.1 Price

Maintenance

2.3.1

Baseline

Volume/Rev

enue by

account &

channel

2.4.1 Create

Long Term

Promo (E.g.

EDLP)

2.5.1 Confirm

Promotion

guardrails

2.1.2 Review

commercial

terms

(non-

promoted

spends)

2.2.2

Assortment

Maintenance

2.3.2

Channel &

account

scenario

planning

2.4.2 Create

Short Term

Promotion

for date and

product

2.5.2 Budget

availability

check

2.2.3

Commercial

terms

Maintenance

2.3.3

Forecast/Pla

n Value by

account &

channel

2.4.3

Review/adju

st in

Calendar

2.5.3 Review

profitability vs

Sales Target

2.5.4 Trade

Promotion

Plan

Approval

Main Requirements

2.1.2.1 Internally agree on price strategy/increases/terms

2.2.1.1 Maintain price changes

2.2.3.1 Maintain commercial (trading) terms

2.3.1.2 Incorporate market and account trends

2.3.1.3 Incorporate new and retired items

2.4.2.3 Create promotion

2.4.2.6 Maintain causals (retail aspects of the trade promotion)

2.4.2.8 Plan trade spends

2.4.2.9 Plan uplift volume

2.4.3.3 Review and adjust promotions in calendar

2.5.3.2 Review profitability of individual promotions

2.5.3.4 Review profitability of total promotion plan

2.5.4.1 Review total promotion plan

2.5.4.2 Submit for approval

2.5.4.3 Approve

2.5.4.3 Pre-reserve fund budgets from applicable funds

2.5.4.4 Send promotion information to Demand Planning


Account & Promotion Planning – Optimization Example


Account & Promotion Planning – Optimization Example






Main Requirements

3.1

Sell-In with

Customer

3.2

Promotion

communication

3.1.1 Joint Review

with Customer

3.2.1

Communicate

Customer plan to

field sales

3.2.2 Release

Promotion plan

3.2.3 Establish

Discount and

Rebate

Conditions

3.2.4 Reserved

investment from

Funds

3.1.1.1 Joint review of account calendar

3.1.1.2 Joint review of Plan including retailer KPIs

3.1.1.3 Joint review retailer profitability

3.1.1.4 Negotiate promotion frequency & depth of investment

3.1.1.5 Refine plan

3.1.1.6 Reach agreement

3.2.1.1 Share the promotional plan with field sales

3.2.1.2 Share promotional merchandising information

3.2.2.1 Send promotion information to ERP

3.2.2.2 Send promotion information to APO

3.2.2.3 Send promotion information to S&OP

3.2.2.4 Prioritize promotion information relevant for Retail Execution

3.2.2.5 Send promotion information to Retail Execution

3.2.3.1 Send discount information to Sales and Distribution

3.2.3.2 Send rebate information to Sales and Distribution

3.2.4.1 Move funds reservations from pre-reserved to reserved






Main Requirements

4.1

Execution

4.2

In-store

promotion

compliance

tracking

4.3

Financial Accrual

4.4

Claims &

Settlement

4.1.1 Sales Order

& delivery

4.2.1 Create

Promotion in-

store tasks

4.3.1 Calculate

financial accrual

4.4.1 Proof of

performance /

compliance

collection

4.1.2 Billing

4.2.2. Send

promotion tasks

to Retail

execution

4.3.2 Post

financial accrual

4.4.2 Deduction

clearing

4.1.3 Purchasing

4.2.3 Capture

promotion

compliance in-

store information

4.3.3 Reverse

Financial accrual

4.4.3 Process

Invoice Claims

4.1.4 Update

Funds with

Financial

discounts

4.2.4 Review /

Analyze in-store

compliance

information

4.3.4 Release

unused accrual

4.4.4 Settle

Claims

4.4.5

Chargeback,

write off, correct

or cancel

4.1.4.1 Post updates from Billing into funds

4.2.1.1 Create specfic tasks for each tactic

4.2.2.1 Send tasks to REX for compliance checking

4.2.3.1 Capture promotion compliance in-store information

4.2.4.1 Review / Analyze in-store compliance information

4.4.2.6 Update checkbook approved claimed amount

4.4.4.5 Update checkbook settled amount






5.1

Account

Pre/Post-

Evaluation

5.2

Promotion

Pre/Post-

Evaluation

5.3

Market &

Category

Analysis

5.4

Funds Analysis

5.5

Promotion

library

5.1.1 Account

Profitability &

Effectiveness

5.2.1 Promotion

Profitability &

Effectiveness

5.3.1 Market &

competitor

Analysis

5.4.1 Funds

Checkbook

5.5.1 Identify

top/bottom

promotions

5.1.2 Account

Financial

Analysis

5.2.2 Volume

Decomposition

5.3.2 Price

Elasticity

Analysis

5.4.2 Funds

Consumption

5.5.2 Identify

most effective

tactics

5.3.3 Category

Analysis

5.4.3 Balance

Funds Analysis

5.5.3 Build

Promotion

Library

5.4.4 Budget &

Transfer

analysis

2013/2014 FUTURE DIRECTION

Customer Business Plan (CBP)

TPM in Fiori

Improved Account and Promotion Planning

Trade Promotion

Assessment and Optimization

Promotion Execution Enhancements

Trade Promotion Management in Memory

Planning

Integration with S&OP

TPM in the CloudNew Listing Front-End

Usability EnhancementsTPE integrated Demand

Data

CP-Retail Collaboration

Account and Trade Promotion ManagementRoadmap Overview

Prio 1

Unilever SCDP retrofits SCDP retrofit extensions

Trade Management Footprint

F1

Montreal

100+ customers

50+ customers live on CRM 2007 or 7.0

16000 users

All tiers represented, mainly large enterprises

Consumer products, but also other industries selling over-the-counter

Global distribution due to multi-language ad multi-currency system

(North America 40%, Latin America 5%, Europe 45%, Asia/Pacific 10%)


Customer Feedback:

SAP is 1st in seven categories

1st in Supply Chain Planning

1st in Supply Chain Execution

1st in Enterprise Resource Planning

1st in Customer Relationship Management

1st in Trade Promotion Management

1st in New Product Development & Introduction

1st in Business Intelligence

Source: - http://consumergoods.edgl.com/2013-readers-choice

http://consumergoods.edgl.com/2013-readers-choice


Trade Promotion Management

SAP rated #1 in category

Trade Promotion Management.

• Summary

• Survey demographics

• Supply Chain

Execution

• Supply Chain

Planning

• Customer Relationship

Management

• Trade Promotion

Management

• Enterprise Resource

Planning

• New Product Dev

and Introduction

• Business Intelligence

“The real priority is to improve promotional outcomes. It is a journey. TPM is a big component of that and TPO

will be as well. But, the endgame is better promotions and that should be kept clearly in mind because it isn’t

about the technology. It is about the business process.” (Dale Hagemeyer, Gartner)

"Our goals were to enhance our insights for planning, improve our budget management, and give ourselves the

ability for integrated analysis and reporting [using SAP software]. The key takeaways: We did it. It works. And, a

week after we deployed it our users said, ‘we like it and it’s easy to use.‘” (Jeff Dahl, Pepsico)

http://consumergoods.edgl.com/2013-readers-choice/trade-promotion-management

http://consumergoods.edgl.com/2013-readers-choice/trade-promotion-management


Standing Out in a Sizzling Marketplace with

SAP® Trade Promotion Management

Company

Johnsonville Sausage, LLC

Headquarters

Sheboygan Falls, Wisconsin

Industry

Consumer products

Products and Services

Number one United States brand of

bratwurst, Italian sausage, smoked-

cooked links, and fresh breakfast

sausage links

Employees

>1,400

Web Site

www.johnsonville.com

Objectives

Retire homegrown legacy planning solutions that cannot support future plans for growth

Align regional processes

Increase flexibility in deal creation, reporting, and innovation to sharpen competitive edge

Establish processes for data collection, data management, and reporting to increase productivity and accuracy

Improve understanding of the return on investment (ROI) of trade promotion spend

Why SAP

Expertise and track record of the SAP® Consulting organization for delivering success

SAP Trade Promotion Management application, enabling unified planning for total retail salesand replacing four unconnected systems

Implementation in just nine months

Future plans

Realize double-digit growth in retail sales

Continue to maintain top ranking in market share for fresh sausage in the United States, while growing both market share and profitability

Expand reach, while consistently offering high-quality, great-tasting products customers can count on to keep them coming back for more

“The Johnsonville brand mentality is focused on quality, so we rely on

quality technology from SAP. SAP Trade Promotion Management is going

to help us continue to grow while maintaining the high quality and great

taste customers have come to love.”

Lori Plate, Director of Enterprise Applications, Johnsonville Sausage, LLC

PrecisionImproves financial reporting and accuracy

EfficiencyDramatically reduces non-value-added work

ProductivityEnables more salespeople to interact with customers more often

ScalabilityOpens the door for trade promotion optimization, demand signal management, and predictive analytics across the organization

ProfitabilityIncreases ROI and top-line revenue growth

CMPxxxxx (YY/MM) This content is approved by the customer and may not be altered under any circumstances.

http://www.johnsonville.com/


Case Studies



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