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OSA Learning Day

OSA Seminar March 11

 

On-shelf availability continues to be a challenge for retailers and suppliers. A report released last week tags food out-of-stocks at an average of 8%. The report went on to say that even though being able to find everything she needs is one of the top three reasons the average grocery shopper chooses to shop at a particular retailer, one in 12 of the items on her grocery list will be out of stock. If she shops for less heavily promoted items, that number will be one in ten.

That’s lost sales. Shoppers generally grab a competitor’s item or just leave empty-handed. While they might go to another store or an online source for a large purchase or a particularly coveted item, most suppliers will just see lower sales.

8th & Walton is bringing experts from Crossmark, Rockfish, and the Sam Walton College of Business to present an experiential day of learning designed to give participants real, practical action steps toward solving OSA issues. The course will be held on March 11th, 2015.  Register now.

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Metrics for Social Media

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Refusing to be active in social media, for today’s suppliers, is like refusing to have a telephone. Your customers will look for you on social media platforms. For many people, that’s the top choice for customer service, and of course you want to be part of the conversations going on around your product, category, or brand.

But getting the most from your social media means measuring your results so you can do more of what works well and less of what doesn’t. Social media is much more measurable than legacy media, but you still have to be measuring the right things.

Reach

Reach is one of the things you can measure easily. Either through the analytics available at the social media platform itself or by using social media measurement tools, you can see how many people had the opportunity to see your post.

This is comparable to circulation numbers for magazines and newspapers, because your reach or 45,000 doesn’t mean that 45,000 people actually saw your post. It means that 45,000 people had the chance to see it if they happened to look.

However, reach can tell you a lot about which posts are most effective. A large (unpaid) reach at Facebook shows that Facebook chose to show your post to more of your fans than usual. A reach for a tweet that’s way beyond your follower base shows that influential tweeters retweeted your tweet.

The type of post that gets top reach for you is valuable information.

Engagement

Likes, comments, retweets, and shares are easily measurable and they can be very gratifying. They can also lead to greater reach, more followers, and goodwill for your brand. Building a community gives you more people to talk to when you want to promote your product, and earns you the attention of the people you want to talk to. Increased engagement is a reasonable metric for social media campaigns.

However, the tactics that increase engagement can be completely different from those that lead to increased sales. If you put up a picture of a baby or a puppy at Facebook, you’re pretty much guaranteed a lot of Likes. That doesn’t mean that the people who Liked your baby will remember your brand ten seconds later.

So use engagement metrics, but be sure to include some posts that measure intent to purchase — coupons, links to your store locator, information about your brand that is important to people who want to purchase. That will help you differentiate the polite, “Oh how cute!” from the “I love this brand!” engagement.

Action

The number of social media fans who take action — clicking through to your website, signing up for your newsletter, buying your product — will be a small fraction of the number you reach. In fact, the classic funnel image works here: your reach is the top of the funnel, some will engage, and some of those who engage will take action.

But you should include some action metrics in the numbers you use to measure the success of your social media campaign. These numbers are harder to manipulate and show a firmer connection with your primary business goals.

But you have to set actions up. Make sure there are links to your website available to click. Offer promotion codes at a specific social media platform and keep close track of how often they’re used. Have specific consumer actions in mind and make sure it’s easy for your consumers to take those actions. This is where you can actually check conversion rates and ROI.

Whichever metrics you choose, give your social media activity time to work. Social media is today’s word of mouth, and you know that can take time.

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Owned, Earned, and Paid Media

Saturday Morning Meeting for Suppliers shared a Special on Social Media on Feb 28th. Download our free ebook on Social Media Step by Step to learn more about many of the points made on the special.

One point that came up repeatedly was the concept of owned, earned, and paid media. Rebecca and Rosie Haden of Haden Interactive explained the distinction:

  • Owned media includes content over which you have control, such as your brand website, and to a lesser extent your social media accounts and fan pages.
  • Earned media includes comments from fans, unsolicited blog posts, and press coverage; to a lesser extent, this can also include sponsored posts and sponsored press.
  • Paid media is your ads, including paid content in press and on blogs.

Henry Ho of Field Agent spoke about the importance of suppliers’ websites, listing some specific reasons consumers visit brand websites:

  • Planning a shopping trip.Google reports that up to 97% of shoppers, depending on the industry, do online research before they buy at local brick and mortar stores.
  • Looking for specials and deals. Shoppers want to see the local store’s weekly specials, and they want to get in on special offers at the website.
  • Researching a product. Whether it’s your product, your brand, or your category, the average shopper spends some time learning about it before buying. Google tells us that shoppers may check 10 different sources of information in their path to purchase.
  • Deciding whether to go to a specific retailer. This decision may include checking on-shelf availability before visiting the store.
  • Buying something on the website. Increasingly, suppliers are offering ecommerce at their websites. Consumers may thus have the choice between visiting a store to see the item in person, or buying it immediately.

Your brand website is the owned content you can control. You want your customers to visits repeatedly during their path to purchase, and you want to be the best source of information for your category. When consumers visit an average of 10 sources, it’s a great advantage to a supplier to be able to have five social media accounts sending visitors to their website with its awesome content.

But only if the website actually has awesome content.

Leslee Urhahn from IN Marketing and Stephanie McCractic of Acorn both emphasized the distinction between paid ads and social media, which is an interactive conversation. However, the line is blurred. For one thing, you can boost posts and pins and tweets, paying to spread the conversation further. For another, you can pay bloggers and social media influencers to share your story, or pay marketing companies to help you connect with those influencers.

Since Google is inflexible about paid vs. earned content, it might be beneficial to avoid blurring the line too much. However, social media can drive traffic to your website separately from search — and Google doesn’t matter when it comes to traffic to the stores where your items are shelved.

Finally, Brandon Viveiros from Saatchi And Saatchi X reinforced the importance of interaction in earned media by reminding suppliers that Millennials in particular expect a company to answer them as though they were friends. That connection is what earns suppliers positive comments from fans on social media.

Watch the whole episode in the video above, and don’t forget to download the ebook!

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Walmart Speaks Out on HB 1228

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Walmart isn’t known for political activism, but they’ve spoken out against a bill being considered in their native state of Arkansas:

“While HB1228 will not change how we treat our associates and operate our business,” said Walmart spokesman Lorenzo Lopez,  “we feel this legislation is also counter to our core basic belief of respect for the individual and sends the wrong message about Arkansas, as well as the diverse environment which exists in the state.”

Lopez refers to a bill known as, “The Conscience Protection Act,” which allows individuals to sue everyone from teachers to firefighters if they believe that policies have been enacted which would “substantially burden” their ability to practice their religion.

Arkansas’s Governor Hutchinson expressed qualms about the bill, saying that since he as a lawyer couldn’t figure out how it would work, he thought it likely that ordinary citizens would have the same problem.

The law seems to be in response to anti-discrimination laws such as the once passed in Fayetteville last year, which made it illegal to refuse a job or a hotel room to gay, lesbian, or transgendered individuals. This gives a hint of what the law is intended to do.

However, the law as written says that it will, “Ensure that in all cases in which state action
substantially burdens the exercise of religion strict scrutiny is applied; [and] Provide a claim or defense to a person whose exercise of religion is substantially burdened by state action.” There is a reminder that the state constitution already says that “no human authority can, in any case or manner whatsoever, control or interfere with the right of conscience,” and a declaration of a state of emergency, relative to the burdening of religious experience.

Walmart’s hiring policies specifically include gay and lesbian individuals in the section on non-discrimination.

The law has stalled in committee.

 

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Retail Link Training in Elizabeth, New Jersey

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8th & Walton is bringing expert Retail Link and Walmart supplier development training to Elizabeth, New Jersey, in March!

Courses:

Beginning and Intermediate Retail Link take you through the basics of the software — where to find everything and what to do with it when you find it — but so much more than that!

Since 8th & Walton facilitators are always Walmart/supplier community veterans, you’ll learn how to apply the data to your real-life needs. No more pulling reports and looking to see whether or not you should feel happy. Instead, you’ll know how to use the reports to find answers to your questions and actionable data for strategic planning.

Replenishment and Inventory Management is all about seasonality, forecasting, and inventory management. Data-based decisions give you more control and a stronger position. Decision Support Decoded will let you get the most from queries and reports, from building the initial query to sharing templates with your team. And Accounting, Invoicing & Deductions helps you find the best way through the Walmart Payables system while reducing or eliminating deductions.

Take one course or take all and you’ll see a difference the very next day when you put what you’ve learned into practice.

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Walmart’s Social Media Example

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Looking for a good example of social media use in the CPG/Retail world? Try Walmart. Their social media icons are modestly placed at the bottom of their website, but they have plenty of followers and fans.

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The Facebook page follows the rules — there’s a big photo (in this case a photo collage) with no text. They’re using the new call to action button, in this case a “Shop Now” button.

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Scrolling down the page we see more good choices:

  1. An inspiring, customer-centric “About Us” message
  2. Pinterest-style graphics with a catchy hashtag.
  3. Local connections
  4. An invitation to join in
  5. Useful information people will come back for regularly
  6. Some flat out promotion — but not only that.

Walmart’s Facebook page also has conversations with visitors, videos, recipes, and in general a good variety of content.

Twitter keeps a consistent look, but has different content, so people may follow both.

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Twitter also often has a different demographic profile from Facebook; for example, many companies find that they have more men following at Twitter and more women at Facebook. People may visit Twitter more for work and Facebook more for play. You’ll get this information about your company from your social media analytics. Then think strategically to plan the best content for each platform.

Walmart’s Google+ page is completely different, recognizing the different audience:

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Pinterest is used by many female consumers as one of their favorite search engines, so Walmart provides plenty of lifestyle content:

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Click through to one Pinterest board, and you’ll find that the content includes pins from bloggers who may or may not mention Walmart but who are writing about products, brands, and categories relevant to the Walmart shopper, as well as products and posts from brand ambassadors.

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By keeping the customer, the visitor to the particular social media platform, and the strategic goal in mind, Walmart is very successful at social media.

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Saturday Morning Meeting Talks Analytical Sales Ideas

In the most recent episode of 8th & Walton’s Saturday Morning Meeting for Suppliers, Andy Schuch talked with James Farmer of the Harvest Group about analytical sales ideas.

This might not be a familiar term to most suppliers yet, but the Harvest Group expects that it will become a key concept as suppliers’ data needs shift.

Right now, there’s plenty of data available. Retail Link is free to suppliers, but many other sources are costly — sometimes too costly for small suppliers. “We end up taking all of our investment and putting it into getting the data,” says Farmer, “and then after we’ve done that we have no money left actually or investment left to actually understand it.”

Farmer says that top-down market research data isn’t the only way to go.

“If you actually take analytical sales ideas and find those patterns and relationships” he says, “then you string those together and you have a plan that actually will generate another point, two, ten points of growth.”

This can be particularly powerful as store formats change and develop. The patterns at a Neighborhood Market might be quite different from what you’ll see at a Supercenter.

“If I look at an item in a specific week or a specific month, I see a pretty static number,” Farmer points out. “But when I pull that apart and [ask], ‘How’s this item doing in all these different stores?’ I see a really different picture.”

One example is warm-weather seasonal merchandise like swimwear, patio furniture, and the like. Most of the country is showing flat sales, and manufacturers are often focused on closing out inventory and planning for next year.

In Florida, however, the “snowbirds” who head there for the winter are moving in and stocking up. Looking at data on a store-by-store, bottom-up basis can show where it’s time to use a different approach for greater benefits.

Watch the whole episode above and see how this can relate to your company, in addition to more insights that will help you be a smarter supplier.

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Walmart Starting Wage Increase

Walmart announced that their new starting wage will be $9.00 an hour — well above the minimum wage. This will bring the average wage for full time hourly workers to $13.00, with part-time workers averaging $10.00 an hour.

This change will take place in April, with another $1.00 bump next year, for a billion dollar investment on Walmart’s part during this fiscal year.

Walmart has taken a lot of heat over its wage structure. The retail giant believes that the pay raise for half a million Americans will be good for the economy. It’s also expected to help with turnover, and may be part of the plan to improve in-store execution.

Additionally, with California, Connecticut, District of Columbia, Massachusetts, Oregon, Washington, Vermont and Rhode Island already mandating $9.00 as the minimum wage, it might be more efficient to go ahead and make the change now.

A letter and video sent by Doug McMillon emphasized that the pay raise is part of a comprehensive new strategy for hiring, training, and encouraging associates to stay with Walmart and take advantage of the opportunities for growth. McMillon’s own experience is given as a pattern for climbing the ladder of responsibility at Walmart.

In addition to the pay raise, improvements in scheduling are also planned.

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Menasha Report on In-store Marketing Effectiveness

Marketing Strategy and Core Objectives of Product words cloudA new report from the Path to Purchase Institute and Menasha Packaging analyzes in-depth discussions with over 30 major CPG companies. The biggest takeaway: some companies are highly effective with their shopper marketing, but many more are not.

What makes the difference? The report identified a number of characteristics that set the successful companies apart.

The first is the use of data. Information sources like Retail Link inform the decision making in the most effective companies, while less effective companies focus on the trendiest tactics.

Second, the most effective CPG manufacturers work closely with their retailers.

They work with their customer teams on a promotional planning process that’s in sync with the retailer’s planning process so they actually have time to test and everything isn’t rushed out the door.

The importance of testing, and of being certain to understand the customer, can’t be overestimated. Retailer-specific data and testing are essential, but the most effective companies also work closely with strategic partners and third party services.

They work actively with their suppliers to better leverage P-O-P displays and are willing to rely on the insights and testing capabilities of companies like Menasha.

The report repeatedly comes back to the importance of strategic planning. Less effective companies take a “scattershot approach,” allocating resources in an uncoordinated way across many tactics.

“There are times when we act as if trade promotions, shopper marketing and brand communications are going to be seen by completely different people.”

Menasha concludes that effective organizations share their story and their retailer’s story, developing cohesive strategies based on facts.

Read the full report.

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Being a Smarter International Supplier

tiarksThis is a guest post from Ron Tiarks, now EVP International Division at 8th & Walton and formerly a Senior VP at Walmart and President of Walmart Germany.

  • Be Prepared
  • Build Relationships
  • Be a Good Partner
  • Have a Clear Strategy
  • Seize the Moment

These points all seem pretty obvious, but as suppliers we all know how challenging it is to do these things every day. Apply this to entering the international market, and it gets exponentially more complex.

I will share just a few thoughts about my perspective on how these points relate to going into the international arena.

Be Prepared

You have many things working against you when going out of your home market.

One of the largest problems is that your success in the home market can easily cause you to lose your objectivity. Your success and experience does play on your views and will not give you the objective view that is necessary in a new market. Know it. Believe it.

You will be ethnocentric entering a new market. If you can acknowledge this, it will serve you well. Very few people in the international arena haven’t had the unpleasant experience of having to concede to this problem. In my experience, most of us don’t get to that point without learning a few personal lessons first. This has happened to the some of the best companies and business people in the world, and there are plenty of case studies to support it. Part of the preparation is recognizing this challenge.

On the other hand, if you are able to recognize the difference between being ethnocentric and being truly objective, then your fresh view of the market can work for you and actually work in your favor. A fresh perspective allows you to see opportunities that others may have missed.

“Move with speed” is something that Doug McMillian talked about at the YBM. Moving with speed has everything to do with being prepared.

Think about your sports experience. You must play with speed in almost any team sport. In order to do that, you need to study your opponents, know their strengths and weaknesses, understand their strategies and then prepare your team so when game time arrives you are ready to “Move with speed.” It is tough to “Move with Speed,” be “Customer Driven,” and show that you are “Hungry for Growth” if you haven’t done your homework on the market! This approach was clearly outlined at the YBM.

Build Relationships

“Constructive relationships built on trust” was another clear message to the suppliers by Doug at the YBM. It is most likely that this will be the step that will get you into the market.

Just to be clear — Being Prepared will help to keep you in the market, but “Constructive relationships built on trust” is most likely what will get you into the international market.

There is no doubt that the relationships you build with the network of people in the Walmart organization will open doors in the international arena. It goes well beyond the relationship with the buyer; it includes replenishment, product development, and to a large extent the global procurement group.

The global procurement teams in particular actively collaborate with international buying groups and this relationship alone could either open the door or shut the door when approaching a discussion to go beyond your home market. Building a relationship with this network has an accumulative affect that will build your reputation beyond your current borders.

Be a Good Partner

The international buyer will do his/her due diligence by calling on your current buyer. Your current buyer has no reason not to be completely candid with his/her international counterpart about your performance. Your ability to execute and support your current buyer will be communicated. There are many great products that never get the opportunity simply because the perceived support is not there.

Never miss an opportunity to exceed the expectations of your buyers. I don’t have to tell you how demanding it is to support Walmart, but if you want to have an international opportunity, you have to be up to the challenge of doing more than what is expected. None of us has all the resources we would like, but David Cheesewright, President and CEO of Walmart International, set very clear expectations in his International presentation at the YBM: We are to have our best people on the account. You are the best, and it should be reflected in the support.

Have a Clear Strategy

Now that you have worked hard to prepare, build relationships and be a good partner, what is your plan to go international? Your strategy and approach will not only give you a clear path and give you the best chance for success, but they will give Walmart the confidence to know that you understand their customer and how your strategy supports Walmart’s vision as well.

Having a clear strategy includes having your team prepared. What does going international mean to them, and what will their part be in supporting it? What additional tools, training, support or organizational structure will they need take on the challenge? These are just a few examples of some of the things to consider when putting your strategic plan together. This is much harder work that many of us recognize in the beginning.

Seize the Moment

Finally the opportunity comes. It may be a direct discussion with an international buyer or indirectly through your network of relationships such as product development and the global procurement teams . . . but now that time has come, you are prepared, you have built your relationships, you have been a good partner and you have a clear strategy. This will give you the confidence you will need to fight through the challenges as you go forward, and allow you to move with speed and accuracy and give you the best chance for success. This is seizing the moment.

What if Walmart called today and asked you to take your product from the U.S. to ASDA to test as a promotion?

This very question came to a supplier. Walmart did ask them to bring their product into ASDA. In less than two months, it was on the shelf as a promotion. The item preformed well with and an 85% sell-through in 6 weeks. Not bad for a general merchandise item.

Even though the item performed well, the program did not go forward. The supplier had done their part building relationships and being a good partner. It was product development and the global procurement teams that opened the door, but the success of the item was not enough to keep it on the shelf. The supplier was not prepared, did not know the market, and had no clear strategy. Unfortunately, someone else was given the opportunity to fill that need. That supplier was not ready to “Seize the Moment.” It may not seem fair, but that is the nature of the business we are in. Walmart has made its expectations very clear.

If you haven’t thought about looking outside your home market, you should. Whether you decide to go international or not, considering it will make you a better supplier by challenging your perspective and sharpening your focus.

  • Be Prepared
  • Build Relationships
  • Be a Good Partner
  • Have a Clear Strategy
  • Seize the Moment
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