CPG Chatter

Late last year, I wrote a blog post about whether CPG companies could effectively manage their trade promotions using spreadsheets.  Even more recently I wrote a white paper on the topic, as it continues to come up on a fairly regular basis.  Let’s face it, most of the business world is still Windows-based, and almost every corporate PC comes fully loaded with Microsoft Office.  So Excel is effectively free to the business user.  Why not use it to manage trade spending?

Before I answer that question, I’d like to go back in time a bit.  When I was an industry analyst, I was responsible for writing up the results of a customer management applications survey each year.  One of the questions we asked was what application the respondent used to manage their customers.  In the early years (2000-2001) Microsoft Excel dominated the list with nearly 60% of the responses.  However, over time the number gradually declined as applications like CRM and TPM matured.

So when I saw the results of the recent TPM survey conducted jointly by MEI and Consumer Goods Technology I perhaps shouldn’t have been as surprised as I was.  But in short, only 21% of CPG companies are still relying on manual process and spreadsheets to manage trade promotions.  This is a much lower percentage than has been estimated in many industry outlets over the past few years.  So what is going on, are spreadsheets at long last falling out of favor?

I will explore this in more depth in my webcast on the use of Excel for TPM, but in short I think more and more CPG companies are realizing that their ability to plan, execute, and measure the effectiveness of trade promotions is simply too important to relegate to desktop tools.  The TPM survey also uncovered that nearly half the CPG firms surveyed are spending more on trade promotions this year than last, so the emphasis on getting the most bang for the buck is top of mind.

Don’t get me wrong, I don’t see Excel ever disappearing from the sales process in CPG.  I use Excel daily in my own job and find it to be an immensely valuable tool.  I just think that when it comes to integrating transactional and demand-side data with Excel plans, things start to break down very quickly.  So how about you – have you broken your Excel addiction yet?

Podcast: True Cost of Excel