In our last episode of Taking Stock, we spent some time talking about understanding consumer motivations. In this episode, we dive into how consumer engagement is central to your revenue growth management strategy and how to connect the dots between between RGM and consumer engagement – two functions that can often feel disconnected.
When consumer product companies keep their consumers at the center of their organization, they’re better able to drive strategic decision-making, spark product innovation, inform pricing and promotion, and more. Part of this consumer-centric approach involves establishing a solid consumer engagement strategy and ensuring that your organization has an in-depth understanding of the consumer. What does the consumer care about? What do they expect from your brand? It’s a cross-functional approach that requires involvement and alignment from a number of teams, from the supply chain all the way through sales and marketing.
What is RGM? and How Does Consumer Engagement Affect It
A solid consumer engagement strategy is also vital to the success of an organization’s revenue growth management (RGM) practice. RGM is a holistic approach that requires cross-functional alignment across an organization – it focuses on optimizing pricing, promotions, and assortment to drive revenue and profitability for a business. At its most basic function, RGM emphasizes keeping the consumer at the center of the business, helping organizations run in the most efficient and profitable manner possible.
So, how do these two strategies – RGM and consumer engagement – ultimately contribute to a CP organization’s success, particularly during a time of inflationary pressures and price volatility?
Connecting the Dots: RGM and Consumer Engagement
As we connect the dots between RGM and consumer engagement, there are a few key considerations that CP organizations need to keep in mind. In order for CP companies to run as efficiently and profitably as possible, it’s essential to adopt a consumer-centric mindset, implement the right tools and technologies, and encourage teams to work cross-functionally. Ultimately, the goal of any CP company is to sell products to consumers at the most optimal price, and every single function across an organization plays a role in that. Without that cross-functional mindset, you risk siloed teams working toward misaligned goals.
RGM isn’t just about the tools or technology or data configuration. It’s a holistic process that requires functions across the entire organization to work together, ensuring they’re thinking about and defining RGM in the same way. It’s then leveraging RGM tools and technologies to help perform analytics, make predictions, and disseminate those learnings across the company to make strategic decisions. With this approach, organizations are better able to understand their consumers and put the right things out in the market – at the right time, at the right price, and in the right channel.
Defining Success with RGM
For CP organizations – particularly in a post-pandemic market facing inflationary challenges and pricing pressures – being able to define RGM, understand its key capabilities for success, and determine how it all ties back to the consumer can drive success. But there’s certainly more to consider – how does price pack architecture play a role? What other factors do you have to consider holistically? What are the barriers to achieving efficiency? How should your organization define RGM and consumer engagement success?
In this episode of Taking Stock, I’m joined by Amy Levine and Ryan Mulligan as we discuss a holistic perspective around revenue growth management and how an effective consumer engagement strategy is connected to a successful RGM discipline.
You can download and listen to the RGM and Consumer Engagement Taking Stock with Amy L. and Ryan M. here.
Be sure to listen to the previous two Taking Stock episodes focused on consumer engagement:
- Building An Effective Consumer Engagement Strategy: Taking Stock
- Understanding Consumer Motivations: Taking Stock with Amy L. and Reed M.
In this podcast series, Clarkston Consulting Partner Steve Rosenstock sits down with experts and thought leaders from both within Clarkston and throughout its consumer products, life sciences, and retail client base, covering a range of topics from industry trends and consumer dynamics to organizational governance and business strategy. Steve provides you access to the passions of the guests and allows you to benefit from their stories, knowledge, and deep expertise.