Category Management Series: When Technology Lift Point Of Sales Marketing

So far, in the FMCG world, not a lot of technologies have been used in terms of marketing of point of sales. What is important to calculate, is how much investment you need in the technology and how much extra margins you will get in order to figure out a return on investment. And on products with so much sales with a very low profit, it is difficult to implement new creative technologies without having a negative impact in terms of profit.

Nevertheless, it is always interesting to see when an initiative work. And that seems to be the case for Nestlé in the UK, where they have tested specific POS to make its Quality Street brand stand out of the crowded category.

And it seems to work: they have increased their sales by 41% thanks to the POS. Obviously the candy category is a good one to benefit such an initiative: a lot of those sales are made by impulsion, so when you make them stand out, the increase can be pretty high.

But still, it is interesting to notice those initiative, because I believe technology is not implemented enough in stores in general.

The Real Costs Of Social Media Marketing

Here is an infographic I found on the website of Percolate about the real cost of social media marketing. 

It gives a pretty clear view about how much each components of a social media campaign costs. What is not put into prospectis is the reach you may have with this strategy. These figures are based on the Nestlé marketing campaigns, and I believe that depending on the size of your company, and foremost the size of your online community, the cost/reach will be very different from one account to another. Anyways, I would also like to see the comparaison between these figures and traditionnal media such as radio, TV etc... to see actually what is the most cost efficient.

Nestlé Decides To Create Its Own CRM Program

CRM For Suppliers: A Hard Task

This is a great example of a customer relationship management program established by a supplier in order to get rid of the retailer’s mastery. Indeed, suppliers spend a lot of effort trying to retain customer loyalty, but they don’t have a direct link with customers. They must go through a retailer to get customers data and to be able to set efficient promotions.

More and more, thanks to vouchers and coupons, either distributed on pack or via Internet, they succeed in triggering sales from loyal customers. But the concept is biased, and online coupons are targeted to a very specific type of clientele.

This is the reason why Nespresso has such a strong CRM program: they master the whole distribution channel, which gives them an exhaustive picture of their customers. A highly valuable asset.

I have helped a friend of mine with the Shisheido reward program, which actually find it pretty well done (I don’t have inside data if it works or not though).

Nestlé, A Cup Of Rewards
In Australia, Nestlé has created a new program named Cup Of Rewards, which goals is to reward loyal customers with everything from discounts in toys stores, to movie theater tickets and so on.

When you purchase a pack, you log on the website, and type the code in. Then it gives you points, which allow you to pick a gift.

It reminds me of what Carrefour has implemented not so long ago. Thanks to its wide range of loyalty card holders, Carrefour has negotiated from external partners discounts. The idea is to go beyond rewards simply based on your products. Hence, Nestlé owns more than 65% of market share on the instant coffee market.

It is a very interesting idea. Now, I believe it is also very important to remain focused on your positioning, in order to propose some gifts which make sense. Now Internet gives a fantastic opportunity for suppliers to create their own customer relationship management program, and by it, to get some leverage out of the retailers, even though retailers' customer data base remain the best customer data available.