It may not be new, but it’s still one of the biggest factors holding back FMCG suppliers from achieving business potential – a lack of internal alignment amongst Marketing, Sales, Category and Field Teams. How to get these silo functions ‘singing from the same hymn book’ is a conundrum and a never-ending challenge for many FMCGs, and the focus of this article, by Peter Huskins, for Retail World Magazine.
Comments that we frequently hear when talking to industry contacts:
‘The Marketing team is a roadblock. They don’t get in store. They don’t understand what the Retailer wants, trading terms and the implications or how a store operates”
‘We have developed the product now it’s over to you guys to sell it!’
‘The Sales team only care about achieving short-term sales targets. They don’t get the bigger brand and product positioning story, or the personality of our brand.’
‘This is the first joint planning meeting we have had with Marketing in over 2 years’
And Category and Field teams don’t feel like they are understood by either as they are usually the ones at the bottom of the pile. The old saying that cr*p flows down hill could never ring louder in many companies (go on, have a look in the mirror and deny it!). The ability or inability to execute at store level can be severely hampered by poor planning, communication and inexperienced expectation.
But the biggest issue whilst all of this internal squabbling is going on is:
“who is looking after the Shopper?”
The Shopper is the person who actually makes the BUYING decision at shelf and is the last person we have an opportunity to “talk to” before an item is put into a basket – hopefully our item!
The Shopper may not necessarily be the Consumer – think pet food, kids cereal, fem hygiene, men’s deodorant, hot and cold beverages, vitamins and supplements….and the list goes on.
So how is this really important person usually recognized in our internal structures, processes, procedures and most importantly accountabilities?
Marketing is usually focused on Consumer, Sales on the Customer/ Retailer. The traditional Trade Marketing role is intended to own the Shopper, but is usually the buck-stops-here point of contact for all sorts of other loosely aligned reporting and tactical initiatives that leaves little time to think strategically about our Shopper response
There might be an embryonic ‘Shopper Insights’ department headed up by a person who has had to shift from Consumer insights, Brand Marketing or even Sales to Shopper insights with no additional training by the company. But there is nobody to actually direct Shopper strategy or implement Shopper-focused initiatives, apart from what is contained in BLADS or Trade presenters, and they usually focus on sell ins or on stand placement.
So what to do?
1. Consider Structure Optimisation
It could be that your traditional teams and their reporting structures are no longer effective for your changing needs, or those of your Retail Customer or of your Shoppers.
For example, some leading FMCGs have created a department that is ‘Shopper’. It is on the same structural and reporting level as Marketing and Sales, reporting in to the GM or MD.
Another example is to implement Category teams populated by the relevant Marketing, Shopper and Sales team members.
These examples achieve three things:
a) Ensure that Shoppers as well as Consumers are considered in the strategic decision-making process
b) Create a bridge between Marketing and Sales (including Field teams), thereby improving alignment
c) Ensures a clear focus on the in-store element of the path to purchase.
These are a couple of examples of how to restructure to refocus – not for the sake of it but to change your business approach to include the Shopper in all strategic decisions.
The most important factor is the true function each team is currently performing, whether it is the optimum function for the business, and what, at a higher level, actually needs to be achieved and therefore how the business should be structured to support that objective.
A few things to consider when looking at optimizing your Structure:
- How/ where is your current business structured to include the Shopper? Who currently owns it? Has it settled into a dept where it is treated irrelevantly, and will therefore never get the clean air that the Shopper deserves?
- Look to the future, how do you want to treat the Shopper moving forward? You could argue that a purely PL manufacturer should be more focused on Consumer trends for example and therefore does not require a separate Shopper function. But rather than ignore it, the question I would ask is “how much do I really need to understand about Shopper behaviour to have the best chance of shelf sales acceleration?” even if I do not own the Brand (but remembering that I live and die by the sales volume!)
- Assess the overall internal alignment of the different silos – who does what by when etc., as process and role creep occurs in any business, the larger it is the more prevalent it is.
- Compare Roles across the business to identify insight gaps. What do I spend my money on? Where and how is it used? What questions are my Retail Customers asking me that I cannot answer? What are they asking that they cannot answer?
2. Skills Assessment
Have you changed people’s roles, titles and expectations without giving full consideration to their skill sets?
This can become a major source of stress to both company and team members.
For example, the bevy of new ‘Shopper Insights’ roles that have miraculously appeared without adequate training provided to support the new roles. And the growth of Trade Marketing into increasingly complex analysis and forecasting, again without adequate upskilling or needs analysis.
And one of the biggest issues: Marketing people are expected to know all about Shopper when it currently is not even on the radar of most traditional marketing schools and training grounds, leaving a big knowledge gap that can be behind the ‘roadblocks’ the Sales department complain about.
Further, where does this ‘new budget’ come from for all of this ‘new’ Shopper work? Usually from existing Marketing budgets – and how is that usually received, I’ll give you three guesses. New initiatives need to be funded from across the business, as with any new strategic venture, and some areas may make a larger contribution than others but that should be based on something more than a subjective view of where the $$$ are taken from.
When reviewing internal alignment, it helps to conduct a thorough, supportive (non- threatening) skills assessment of the relevant staff.
Things to consider when undertaking skills assessments:
- What are the current outputs and deliverables by silo?
- What are the duplications and unnecessary outputs?
- Where to reallocate responsibilities if necessary?
- How do I identify best practice for my business? This will depend also on how ‘best practice’ I want to be.
One MD I worked with had the view that each year you ‘removed’ half of the internal comms that rattled around the office, purely to focus on what we needed vs what we wanted (and it does save costs)
3. Training
Roadblocks to internal alignment and getting things done amongst multiple silo functions are often about people feeling threatened. Because they’re supposed to know something they don’t (because nobody has told them or trained them in it!), so they stick to what they know in order to feel comfortable and appear competent.
This ultimately holds the company back.
Tailored approaches are needed for each team, and the personalities within the team, to harness the potential for alignment.
Things to consider when conducting team training:
- Clearly assess current Company and individual skill capabilities and competencies – where are my gaps?
- Use a template or roadmap for training that ensures a consistent flow and sequence of subject matter
- Match the required skills to the Role, Job Description and review process.
- Train the knowledge and skill gaps, rather than everything
4. Culture
Culture, for the purpose of this article, can be defined as ‘how the members of a company experience it’.
Often, in FMCGs with alignment issues, that experience can be fraught with turf wars, impenetrable alliances and the careful navigation of internal politics before any single initiative gets off the ground. If the coffee machine had ears!
That internal friction and disgareement, in turn, results in all those good ideas and strategies sitting on a shelf or being dumped in the ‘too hard’ basket.
Some things to consider to improve your alignment through culture:
1. Co-locate functions that need to work better together.
The classic example is Sales and Marketing. As exampled above, some of the better integrated companies have put Sales, Marketing and Category all on the one floor in an open space. They have to talk and understand the issues other roles must contend with!
2. Musical chairs
It’s an oldie but a goodie: ask people to step into others’ roles for a day (‘walk a mile in the other man’s shoes’) to gain better understanding. A really important one is to get the Marketing people out in field. Get them to see how their brands are brought to life (or not) in the instore environment, and how their brands are being sold by the sales team to retail customers. If Marketing staff aren’t out in field at least once a month, they risk being ivory tower theorists.
Ensure that Marketing co-present that all-important new line to the Retail Customer, not just to get feedback on their creation, but also to start to understand what, when and if their earth-shattering new line will actually get the acceptance and subsequent shelf space that was expected.
If not, what went wrong?
If accepted, how can I use those learnings to make sure the next new line I submit is just as successful?
3. Similarly, ask Sales people to deliver their thoughts on the long term brand building strategy (3–5 years). And so on. The point here is that the company has to invest in enough ‘downtime’ to allow staff to do this i.e. it needs to be seen as valuable time spent.
4. Assign an Account sales problem to another area of the business for a ‘blue sky’ solution. This forces research and understanding of the other functions’ issues and solution frameworks, and the only place to get the answers is from the people who currently do the role. Again they have to talk and understand the issues other roles must contend with.
You may well be surprised with the result!
5. Develop cross functional teams to develop and filter ideas and initiatives. Many companies use this approach for their NPD pipeline, so why would it not work in other areas? You would need to watch that you don’t strangle progress through beurocracy but the principle is worth either discussion or a trial as the end result is clearly worth the investment
- 5. Category Vision
An interesting question to ask a round table of 10 of your most senior executives drawn from across your business:
“What is our Category Vision and what are the key elements I would expect to see when I am shopping in store?”
Most companies would generate certainly over 6, and up to 10 different answers to that simple question.
Why? In most instances there is not a single aligned Company approach that has been developed across the different silos, so that each is subtly and without intent, working against the other.
It is critical that your Company speaks with the one voice with your approach to in store marketing – the impacts are clearly evident to your Retail Customer and may just be the reason why your competitor is considered the thought leader and overall category driver – regardless of market share, npd, promotional spend or rolled up margin.
The fact is that better internal alignment enables a more strategic approach to developing your categories and therefore your business, less time navigating politics, better skilled staff with higher morale, all leading to increased sales due to a stronger end-to-end offer.
Most important is the single business focus that is initiated – one Company one voice.
So, time to empty the silos and critically review your structure with a clear line of sight to the future!
