One Blog |April 25, 2018 | POS Analytics

Beverage Alcohol Distributors Need To Adopt POS Marketing Analytics – Now

Mark Fullerton

An Executive Perspective On Analytics and Data Interpretation

Every year, Anheuser-Busch InBev (ABI) gathers their national wholesalers sales and marketing communication personnel for an annual meeting to present the year’s strategic plan.

At this year’s 2018 SAMCOM (Sales and Marketing Communications Meeting), ABI’s CEO Michel Doukeris made it clear to distributors that he would make analytics and data interpretation more important to the effort of selling more beer this year.

Also, according to Beer Business Daily, “This [analytics and data interpretation] could well be the biggest issue our industry faces. Jim Beam has like 10 SKUs. How many does Budweiser have?”

We’re certain that Mr. Doukeris was not speaking solely of analytics and data interpretation for point-of-sale (POS) marketing, which is OnTrak’s area of expertise. But if you've been following our blog over the years, there is no better way to turn shoppers into buyers and increase sales than POS marketing.

Considering his remarks did mention the importance of analytics in the efforts required to sell more beer, we are certain that tracking, measuring and managing the impact of your POS investments should be a critical component in the goal of “selling more beer.”

In most businesses, especially consumer goods companies, analytics have become this year’s hot-topic. Indeed, you’re easily able to find “analytics” and “best-practice” spoken or written in the same sentence these days.

From our experience with beverage alcohol distributors we are excited about the prospect of this “Sea Change.”

It’s Time For A Change

Yet, some beverage-alcohol distributors still seem to be moving – inexplicably – at a glacial pace in embracing software tools that can offer unprecedented insights into their key sales and marketing drivers, including POS.

In fact, based on our analysis of one-hundred wholesale distributors, of all sizes, it appears that the vast majority of them have taken the first step of automating the ordering of POS with OnTrak’s POS tracking technology.

But POS ordering is not analytics. 

POS Marketing AnalyticsAny POS Marketing solution that does not incorporate data capture and tools that build and enable an analytical approach will not foster an “analytics culture” in your company.

With the same POS Tracking software our customers use to order POS, they are also able to analyze all the POS marketing data that is collected as a byproduct of the POS ordering.

The next step is to correlate the costs of these POS marketing initiatives with the sales of beer - or wine and spirits.

Calculating a campaign’s return-on-investment (ROI) is critical to determining which campaigns work best to increase sales, and which ones don't.

Bottom line, that’s the real value of a POS Marketing technology solution.

Based on the comments of ABI’s CEO, if you’re a beverage alcohol distributor, ABI or not, it may be time to make a change and begin to look at POS Marketing from a totally new perspective – POS Analytics.

POS Performance: Feeling vs. Knowing

The ability to correlate POS initiatives to distributor revenue, or case-equivalents, has, to our knowledge, existed since 2005. Yet a very small number of beer distributors even bother to establish the routines to determine the effectiveness of their POS budgets.

Sometimes, all a distributor hopes to get out of their “home-grown” POS ordering system is the ability to tell their suppliers and customers “what they’ve done for them recently”. Usually what types of POS were ordered and produced for a supplier's brands.

This strikes us as being a defensive statement rather than indicative of offensive measures that will promote sales.

Generally, distributors admit that they count heavily on local marketing to maintain and gain market share. This attitude seems to come more from a “feeling” rather than from even limited factual analysis. We estimate that less than 5% of distributors use some form of POS analytics to help them “know” more about the types of POS campaigns that are most effective. For example:

  • What campaigns should be kept or repeated and which should be scrapped?
  • Does a small number of larger POS signs work better than a larger number of small POS signs? (Actual customer experience)
  • If our POS beats the competition’s POS to the trade by even one business day, can measurable market share gains be realized? (Our customers beat their competition by days)

How do you “know” how to answer these, and many other questions, without analytics?

A World Where Data Has Become More Important Than Software

Many, if not most, distributors are behind in the analytical capabilities discussed in this blog.

Some distributors say they don’t have enough hours in the day to begin such a massive undertaking. That’s their perspective but it may not be as difficult as they think.

Do not despair, take it one step at a time. One of the steps that should be taken first is selecting tools that will enable you to transform your company into an analytics-driven business.

So where to start?

The most successful distributors start with a “best practice” that consists of the following steps:

  • Automate the POS tracking process. Not just the front-end ordering of POS, but including the production, placement and visual verification that the campaign actually made it into the trade.
  • Create a measurement approach with the information collected through the tracking process. For example: Set up a process to measure the impact and ROI of your POS promotions and correlate POS cost to sales results.*
  • Use the data created in steps 1 and 2 to help define and support both your strategic and tactical POS marketing initiatives. We refer to this as “actionable intelligence”.

* All our POS Marketing software products include integrated reporting and analysis tools to quantify POS costs as well as the results of your POS marketing efforts – all at the click of a mouse.

Final Suggestion

Our final suggestion is to heed and perhaps expand upon Mr. Doukeris’ plans to make analytics and data interpretation critical to ABI’s efforts of selling more beer this year.

Since the tools to measure the cost and impact of your POS investment are readily available from OnTrak, perhaps a good place to start would be to correlate your POS Marketing efforts with your sales results.

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