3 Common Challenges with Trade Promotion Optimization and How to Mitigate Them
With this new mainstream surge in generative AI, interest in trade promotion optimization is only increasing, and as a result, more of our clients have questions about what this means for them. Our trade promotion optimization (TPO) experts have been talking about and working with our clients for years on how TPO can enhance and optimize the return on investment (ROI) they’ll see with the trade promotion plans they execute. In this blog post, our experts offer guidance on common challenges with trade promotion optimization as well as some mitigation strategies to realize that ROI. But first, let’s level set on what TPO is.
What is Trade Promotion Optimization (TPO)?
TPO is a process or tool that leverages historical data from past promotions to enhance future trade promotion plans in such a way as to improve or optimize the return on investment. This typically involves leveraging machine learning or artificial intelligence to sift through your past trade promotion plans along with the measured and documented results from those cycles (ex. overall profit, customer profitability, profit by category, etc.). TPO can help to determine what promotions worked well for you in the past, identify past promotions to enhance, or even highlight new opportunities to start folding into your existing promotion strategy to drive the specific results that you and your organization want to see.
However, as with all technologies and processes, TPO does not come without its own set of challenges, the combinations of which will likely be unique to your organization. Through our past engagements with clients in the consumer products space, we’ve seen a few challenges that pop up more often than others. Here are the most common:
- Data Quality and Management
- Organizational Alignment of KPIs
- Natural Human Resistance to Change
Download our free eBook below for the full outline on the three most common TPO challenges. We share key considerations and our best advice for each of the challenges.
Download the TPO Challenges eBook Here
