Successful supermarket promotions: a mini guide for brands

The use of promotions is an essential technique for brands wishing to boost their sales in supermarkets. Inflation and declining consumer purchasing power make the impact even greater...

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The promotion war is on!

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But beware: successful promotions require a well thought-out strategy. That's why Sidely has put together this mini-guide covering the basics you need to master before getting started.

The advertising and promotional plan 

Before starting your promotional operations in supermarkets, it's important to define your promotional action plan.

But first, what is an A&P plan?

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In 2 words, this marketing tool allows you to summarize your marketing plan for one year, and integrate all the advertising and promotional actions you're going to implement.

Promotions are based on a number of factors:

• The objective of the campaign: to increase sales, build customer loyalty, etc;   
• Typology of the target customer: to best adapt your promotion, it is necessary to understand your target audience and its expectations;
• Selected product: determine which product to highlight in this promotional campaign, and why;
• Periodicity of actions: you need to establish a calendar for your campaigns (start and end dates) and decide when to implement them (e.g. product launch date, holiday season, back-to-school period, etc.);
• Budget: It is important to determine the amount of money you can allocate to your promotional campaign, in order to maximize your return on investment;
• Means of communication: the channels and means to be deployed are as numerous as they are varied: sales promotion, TV advertising, sponsorship, press, radio, mailing or social networks, etc. 

In addition, it's imperative to monitor and measure results, to ensure the effectiveness of your campaign. In fact, you'll probably need to adjust your strategy according to feedback and market trends.

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The different types of supermarket promotions

As a reminder, your objective when implementing a promotion is to increase sales volume. To achieve this, you will lower your prices in exchange for an increase in the volume of product on sale. This negotiation can be carried out at two points, creating two types of promotion: negotiated and pirated. 

1. Negotiated promotions: these are called negotiated promotions because they are negotiated directly at the central or regional level. 
2. Pirate promotions: these are generally the result of a good agreement between the brand and a sales outlet, or of non-catalog sales actions. Sales staff then sell the promotion directly to the stores. 

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The different promotional mechanisms

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Sampling / Free Trial

Let's start with a word of caution: since Article 16 of Law No. 2018-938 of October 30, 2018, the term "Free" in food promotion has been outlawed. Brands have since got into the habit of preferring it to the term "offered".

That said, there are two kinds of sampling or testing of this type:

1. Distribution or free tasting: the customer can taste or test a product, often at a stand with a brand presenter, who can give information about the product. 
2. Temporarily test a product or service : for example, if you sell software, you can offer a temporary license, so that your target audience can see what it's like and make a decision before buying the paid version.

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Use case : you want to attract possible number of customers. They can then test the product without taking any risks.

Ideal for launching a new product.

Price reduction

It's an undeniable lever for selling more! A method that seems simple, but in fact involves many techniques: 

• Direct discount : you offer a price reduction that can be applied immediately at the checkout. Also known as BRI, for Bon de Réduction Immédiate ;
• Coupon: out-of-store coupons are supplied in advance in magazines, by e-mail, post or on the Internet. They encourage your prospects to visit the store to buy your product. You can also provide in-store coupons;
• Deferred reimbursement: following their purchase, customers have the option of being reimbursed for part of the sale price. They can also be reimbursed in the form of a gift card, which encourages them to buy again. The accepted term is ODR, for Offre De Remboursement ;
• Quantity discounts: for the same price, your customer obtains a larger quantity of the product. You can also make batch sales.

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Use cases : The primary aim is to encourage impulse buyingwhich will contribute to increasing your sales.

You can also use this technique if you need to increase your sales of a particular product, so that you can destockingor in the event of a sales deficit.

The introduction of a introductory offer for a new product is also a good way to attract your target customers.

Finally, with the right POS material, such as shelf stoppers, you'll stand out from your competitors.

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Risks and constraints associated with price reductions

When it comes to offering reductions, certain risks need to be known and controlled: 

• Avoid having a product on promotion too often. This would encourage your customers to wait for the next promotion before buying. In this case, it's your profit margin that takes a hit, and sometimes even your sales;
• The EGalim law regulates promotions: your distributor is obliged to apply a minimum mark-up of 10% on food products, and therefore cannot offer your products at cost price;
• Similarly, discounts may not exceed 34% of the sale price on food products, with the exception of perishable foodstuffs threatened by rapid deterioration (products with a short shelf life);
• Finally, selling at a loss is strictly prohibited.
  
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Rewards: loyalty points in exchange for another product

Simply put, you're going to give your customers a gift! 

Gift items can take many different forms: they can be samples of one of your other products or that of one of your partners, or goodies (flocked with your brand).

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There are different ways to collect the gift. 

• Direct bonus : your customer can, for example, find it directly in the product packaging, like a magnet in a packet of cookies. I'm sure you or your children have fond memories of Marine Malice, or Spy Fox, whose demo was offered with the purchase of a pack of cereals.
• Animation : in the case of sales animation, your brand's animator can offer the gift at the time of purchase; 
• Post-purchase bonus : your customer goes to the department store reception desk once they've finished shopping, to claim their "prize";
• Deferred bonus: here, you use a loyalty points system. Your customer collects points or proof of purchase. He then sends them to you to obtain his gift. This system is a good way of encouraging repeat purchases;
• Direct self-pay bonus: the consumer has to contribute financially - but for a very limited amount - to obtain the gift. For example, the customer buys a PC and for 1 euro more he gets the computer cover;
• Deferred self-pay: a technique similar to direct self-pay, except that in this case your customer buys the product, and then has to send you proof of purchase with the financial contribution to obtain the gift.

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Use cases : if you're looking to customer loyaltythis is the most suitable promotional method, as it encourages your customers to make repeat repeat purchases.

The premium is also ideal if you want to to promote another product of your brand. Adding a sample can also help regulate your inventory problems.

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Competition Games

This promotional technique allows your customers to take part in a game to win a prize: one of your products, an object, a voucher, etc. 

You can opt for different formats, with or without obligation to buy:

• Spinning wheel to obtain a prize; 
• Scratch tickets ;
• Single draw ;
• Questionnaire followed by a draw.

Competition games in supermarkets may seem complicated to set up, since this technique involves certain constraints, such as the need to draw up rules and regulations. However, the Consumer Code has been relaxed, and it is no longer compulsory to file the rules with a bailiff. Similarly, in the case of a prize draw, it is not necessary to be under the supervision of a bailiff.

The use of a bailiff is still highly recommended if you want to set up high value prizes, to avoid any problems in the event of a dispute. 

Tip: the draw also gives you an excuse to organize another in-store event!

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Use cases : This technique can be used in a variety of situations:

• Arouse the curiosity of new customers.
• Launch a new product: to make it known and tested.

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Ensure that your supermarket promotions run smoothly

Now that you've determined your objectives, drawn up an A&P plan and chosen the actions you want to implement, all that's left to do is put them into practice!

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Here too, we'd like to suggest a few best practices to help your point-of-sale promotions run smoothly.

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To begin with, keep in mind that optimizing these various promotions generally requires good product dramatization.

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In addition, as with all your marketing and sales actions, you need to move forward in chronological stages to ensure that your promotional action plan runs smoothly.

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The commitment phase

The commitment phase, also known as OP resale, corresponds to the period during which the promotion is offered to stores. The aim here is to convince outlets to adopt the promotional operation.

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To validate this step, your sales representatives enter the key information about the promotion directly into their mobile CRM:

• Event dates
• Promotion duration
• Promotion type
• Package size (number of packages ordered)
• POS ordered
• Etc...

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This is also the time to place orders for POS and display materials. This anticipation is essential to ensure on-time delivery and optimal in-store execution.

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The set-up phase

Also known as the implementation phase, this stage corresponds to the actual deployment of the promotion in-store.

Area managers play a key role here: they have to visit the point of sale to check that negotiated agreements are being applied, and to guarantee optimum promotion. In concrete terms, they ensure :

• Compliance with merchandising plan
• Pricing compliance
• Presence and correct positioning of POP and POS displays
• BIS availability
• Etc...

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To ensure effective follow-up, it is essential to take photos of the shelf once the promotion has been installed. These visuals will enable you to monitor execution, compare with the results at the end of the operation, and adjust future actions if necessary.

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The observation phase

This final step enables us to evaluate the execution and real impact of the in-store promotion.

For effective follow-up, check the key elements:

• Quantity actually sold (actual packaging)
• Presence and set-up of POP and POS displays
• Inventory and feedback from teams in the field
• Etc...

Take photos of the shelf and compare them with those taken during the initial layout. This will help you identify any discrepancies and adjust your future operations.

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Equipping your area managers

To guarantee the success of your in-store promotions and monitor every stage of their deployment, it's essential to equip your sales force with a mobile CRM specialized in supermarkets. Such a tool enables you to track sales in real time, measure the impact of your point-of-sale actions and maintain control over execution in the field.

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A CRM with data collection capabilities makes salespeople's work easier, saving them time on the spot, centralizing essential information and preventing data loss.

Last but not least, it ensures fluid communication between head office and the field, enabling rapid transmission of updates on promotional actions and in-store events.

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Measure the performance of your promotions

Tracking the impact of your promotions is essential for evaluating their effectiveness and adjusting your marketing strategies. Here's how to measure and analyze your promotional performance to maximize your results.

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Analyze your competitors' promotions

Understanding your competitors' promotional strategies enables you to identify market trends and optimize your own actions. During field visits, your area managers can observe :

• Highlighting competitor promotions (facing, pricing, POS).
• Price elasticity and the impact of price cuts on sales.
• The most attractive offers for consumers.

Regular competitive intelligence helps you adjust your campaigns and anticipate market fluctuations.

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Track your operating results

Two indicators are worth keeping a close eye on:

• Sales efforts (number of e-mails sent, calls made, visits carried out, etc.).
• In-store execution (installation of animations, respected highlights, POS in place).

By analyzing this data, you can adjust your objectives and check the commitment of your sales teams.

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Evaluate the impact of point-of-sale events

Make sure your promotions are well implemented and generate traffic. To do this :

• Use field surveys to verify proper execution (presence of point-of-sale displays, available stock).
• Analyze in-store photos to ensure consistent campaign execution.
• Check the duration of the animation and its compliance with commercial agreements.

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Analyze sales performance

The ultimate goal is to understand the real impact of promotions on your sales:

• Compare sales before, during and after the promotion to assess its effectiveness.
• Analyze remaining stocks and breakage to adjust future orders.
• Segment your points of sale (best stores vs. new stores) to measure the effectiveness of promotions on different distribution networks.

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Track your promotional rate

The promotional rate measures the impact of promotions on your overall sales:

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Promotional rate = (Promotional sales / Total sales) x 100

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In supermarkets, this rate varies between 20% and 40%, depending on the product category. It's crucial to compare it with :

• Your margin rate, to avoid loss of profitability.
• Your promotional sales, to measure the real effect on your sales volumes.

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If your promotional rate is too high in relation to your margin rate, you may need to adjust your strategy to avoid over-reliance on promotions.

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Optimize your promotional strategies

Analyzing your results allows you to fine-tune your campaigns and improve their profitability. Use this data to :

• Identify the stores where promotions perform best.
• Adjust your offers according to buying behavior.
• Better manage your stocks and avoid out-of-stock situations.

A well-executed promotion not only boosts immediate sales, it also builds customer loyalty and strengthens your position on the shelf.