The Executive Report - capregroup.com€¦ · The Executive Report. Proprietary & Confidential 2 The Time is Now ... Merchant automation will continue with human intervention to override

Sales Capabilities of the Future

The Executive Report

Proprietary & Confidential

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The Time is Now

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• COVID-19 has accelerated many of the retail trends and future challenges we will face

• Knowing this type of change is the new normal, planning for the future is even more important

• Sales capabilities will need to adapt to changes across multiple disciplines (e.g. media, supply chain, eCommerce)

Online retail sales increased 40% first 2 weeks of April

50% of online grocery & health product shoppers are doing

it for 1st time during pandemic


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We Interviewed an Impressive Group to Learn How They’re Thinking About Future Capabilities


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Our Study Focuses on FUTURE Sales Organizational Capabilities

Today’s organization size, structure and budget changes

Future drivers of change in the marketplace

Top priorities for next 3-5 years

Changes to capability areas and budgets in the future

Discussion Topics


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Market Forces That Will Shape Future Sales Capabilities Shopping

Evolution

Insights and Data

Automation

Digital & Omnichannel

Margin Pressures

Dynamic Organization

▪ Consolidation of retailers/distributors and new partnerships will continue, narrowing retail choices

▪ Economic downturn leads to increased demand for affordability and private label

▪ Real-time predictive analytics & AI will continue to grow led by retail

▪ Merchant automation will continue with human intervention to override only

▪ Virtual selling skills will be necessary in new world of limited travel, automated merchants and working from home

▪ Diverse talent with general management mindset will be required for joint value creation

▪ COVID-accelerated growth of eCommerce that is here to stay

▪ Investment in national media shifting to customer digital media

▪ Price management is critical with algorithm-based pricing and price transparency

▪ Revenue Growth Management will be critical to ensure profitability across customers in the evolving marketplace


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Priority Sales Capabilities

Sales as a General Manager

Win with the Winners

Insights to Thrive

Dynamic Delivery

Digital Transformation


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• Total Business at the Customer Level

• Sales as a Value Creator

• Sales Team Composition

• Talent Needed to Win

Capability Success Drivers


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▪ Retailers are integrating merchant organization to negotiate trade, eComm and digital media

▪ Sales managers shift to operate as general managers across all aspects of the customer’s business

▪ Increased agility of resource allocation across customer to drive profitable sales

Total Business at the Customer Level

Sales as a Value Creator

▪ Buyer automation will necessitate a shift from relationship selling to insights-led joint value creation

▪ Joint planning (JBP) shifts to multi-year category growth strategies

▪ Functional siloes overcome to capture wins

“The days of the salesperson being a relationship-based person are behind

us.”

“We have 3-year joint strategic priorities that feed our annual

business plan”


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▪ Sales teams will become truly omni multi-functional with talent across Digital Media, Supply Chain, RGM, Finance, and Marketing

▪ Cross-functional incentive structures need to create common team-wide objectives based on P&L management including net margin vs net sales

▪ Talent development needs to evolve to expand experience needed for sales GM roles (e.g. rotation through marketing)

Sales Team Composition

“Digital media and promotions are shifting from national to customer-

centric programs”

“Sales will have no separation of in-store and online”

Talent Needed to Win

▪ General Managers needed to lead customer P&Ls and cross-functional teams

▪ Build baseline skills of leaders and sales teams through strong training

▪ Harness technology to eliminate waste and create value


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Journey Forward: Where Are They Now and How Will Leaders Get Started?

Move to a P&L Mindset

➢ Define organization’s 3-year vision; what’s needed for competitive advantage

➢ Develop a capability plan to accomplish 3-year Sales vision

• Streamline work and design customer team structure

• Build a team incentive structure/ talent development & acquisition plan

• Define technology strategy to support one P&L environment

➢ Evolve multi-year, customer-back planning system to support delivery against total P&L objectives (including negotiation)

Not Yet Started

Where We Need to Be

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• Changing Retail and Supplier Landscape

• Dynamic Resource Allocation



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▪ Rapidly evolving retail and competitive landscape will create winners and losers

▪ More powerful partnerships set to produce consumer wins

Changing Retail and Supplier Landscape

“Our shoppers truly remember the experience and that our products

enabled that experience.”

▪ Robust customer segmentation required to identify priority customers/channels and allocate investments

▪ Agile Go-to-Market Strategy a requirement to unlock targeted growth

Dynamic Resource Allocation


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Create Customer Segmentation

➢ Build an actionable customer segmentation (e.g., profit & growth)

• Invest in tools/systems to boost visibility across customer P&L’s

• Leadership advocacy to drive implementation of segmentation

➢ Bridge important gaps in marketing and sales collaboration

• Joint go-to-market strategy development for innovation

• Integration of customer & shopper insights in brand planning

➢ Create channel strategy and toolkits to jumpstart impact with fragmented customers1 52.8

Not Yet Started

Where We Need to Be


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• Automation will Transform Insights

• “FIVE” Ps of Marketing: Personalization



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▪ Automation will accelerate, becoming a base capability

▪ Winning in AI will require clear objectives with new roles/ talent

▪ Creation of customer insights will be key to joint value creation and category leadership

“Investing in advanced analytical tools across the organization will result in

higher value work.”

“Automation will shift the operating model, from running the business to

growing it.”

Automation will Transform Insights

▪ Personalization, fueled by human insights, will expand to meet unique shopper needs (product / service / experience)

▪ Nimble insight and strategy development skills required to capitalize on available data

“FIVE” Ps of Marketing: Personalization


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➢ Accelerate investment in AI

• Develop strategy for new talent (e.g. data scientists)

• Implement dynamic pilot approach to build impact of application

➢ Build an easy access interface to insights arsenal

• Invest in systems to enable centralized access to real-time insights

• Define roles and responsibilities

➢ Develop competencies among teams:

• Targeting and marketing strategy

• Advanced analytics (e.g., Shopper targeting and personalization)

• Insights development and storytelling1 52.5

Not Yet Started

Where We Need to Be


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• Digital: Integrated and Profitable

• Real-Time Insights-led Solutions



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▪ Responsibility for customer eCommerce strategy will be rapidly integrated into selling teams

▪ Focus will shift to driving profitable eCommerce growth

▪ Continued importance of helping the shopper on their shopping journey based on device/mobile-based insights

“We are placing our bets and working collaboratively to get there profitably.”

Digital: Integrated and Profitable

“Transport costs, price investments, and tariffs put pressure on

eCommerce margins.”

▪ Insights will help retailers target shoppers as an audience to win baskets across platforms

▪ Technology/Systems will enable eCommerce growth

Real-Time Insights-Led Solutions

“We need to look for quick stories: here’s the category and here’s what

you should do.”


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➢ Expand sales teams’ eCommerce acumen• Build competencies in analytics, insights, media, supply chain, pricing

➢ Integrate eCommerce into Sales (create omni-commerce teams)

• Redesign teams to get the right people with the right skills on the right teams

• Streamline decision-making and empower teams to act on opportunities

• Build a test & learn capability to enable fast response to consumer trends

➢ Build and integrate an eShopper insights arsenal• Invest in research to understand digital shopper behaviors

• Leverage AI to ensure strong pricing coherency


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Not Yet Started

Where We Need to Be


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• Agile Fulfillment Strategy

• Next Generation Technology Required Yesterday



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▪ Supply chain acumen embedded into sales teams

▪ Reducing costs out of the back end, regardless of channel, will be table stakes in achieving speed to market

▪ Scale will be a cost and reliability differentiator for large brands

“We have shifted the conversation from service, replenishment, and

allocation to savings and strategic partnerships.”

Agile Fulfillment Strategy

“Fast action is critical, and we as leaders must enable people and

processes to change fast!”

▪ Fully integrated manufacturer & customer systems (supply, demand, financial) will drive quick decision making and accuracy

▪ AI will anticipate demand and improve accuracy

Next Generation Technology Required Yesterday

“We have better technology to support new consumer routes to market.”


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➢ Build baseline supply chain acumen

• Enhance supply chain competency within sales teams

➢ Invest in processes that integrate supply chain into Sales

• More efficient processes that streamline decision-making

• Develop real-time reporting and score carding for broader customer team accountability and problem solving

➢ Invest for agility

• New levels of systems integration with customer

• AI and machine learning to improve forecast accuracy

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Not Yet Started

Where We Need to Be


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Existing headcountwill need to expand to GM role

Increase in headcount—to expand into digital & keep pace with customer sophistication

Increase in budget; build or buy to competewith retailers' consumer knowledge

Shift to customer digital & media investment vs. traditional shopper marketing programs

Added headcount to integrate into sales teams

Technology could automate more of this function so that team focuses on decisions

Added budget for technology (right equipment for digital, new tech such as AI)

Increase in headcount and budget especially as complexity increases

Increase in training budget to support expanded sales competencies

Budget and Headcount Predictions in 3-5 Years

Category Management

InsightsShopper

MarketingeCommerce RGM IT Supply Chain L&DSales


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To Conclude, We Asked What Leaders Found Most Exciting

“Investing in learning and development and

insights fuels good strategy.”

“Retail is going to change. Traditional

models will turn upside down.”

The evolution of retail and how to create value

Thinking about the

future

Investing in the organization

and the people

“Saying it aloud helps with thinking about what we need to do

differently.”


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And Most Challenging…

“Financial systems need to be integrated

with supply chain systems.”

“We need leadership champions to drive the change management

required to win.”

Constraints driven by the complexity/age of systems and their lack

of end-to-end integration

Where to play & how to win investment

choices

New paradigm & mindset shifts needed

to embrace change and agile marketplace

“With changing channels, where do we put our investments?”


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How to Build a Best In Class Capability

• Define an aspirational vision for the capability

• Identify strengths and gaps in the current state relative to the vision

• Determine organizational transformations required to achieve the vision based on the identified strengths and gaps

• Develop a multi-year capability plan (work, people, insights, tools) rooted in the transformations required to achieve the vision

To discuss your Future Capabilities and compare to other leader’s views, please visit www.CapreGroup.com or contact us at

[email protected]

http://www.capregroup.com/

mailto:[email protected]

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The Executive Report - capregroup.com€¦ · The Executive Report. Proprietary & Confidential 2 The Time is Now ... Merchant automation will continue with human intervention to override