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If you are the person responsible for the department of trade marketing / distribution, You've come to the right article stop. Here are the necessary guidelines for how to invest.
Take into account the percentage of investment we can devote to trade marketing is important but, And analyze the results? Is it really important technology in this area? Have we achieved the expected results? What can we improve?
Find the answers to your questions here and start seeing benefits.
What percentage of my profits should invest in trade marketing?
there is still a formula to answer all the questions posed companies, including those that directly affect trade marketing.
Adequate investment to be made in the field of trade marketing, It is relative and varies depending on the particularities of the company. Knowing the business environment data on what percentage of the budget is set aside for this area in other companies, It can help you get an idea about how much should we invest in trade marketing.
In accordance with the trade club, most of companies invest approximately 15% of its total profits in business expenses. This percentage will cover costs to invest in trade marketing, sales, merchandising, marketing and supplies.
Within this breakdown, investment will be distributed according to the priority of each element, starting with the operational investments.
After this capital distribution, It is estimated that the average investment for marketing trade round 1%.
Measuring ROI on trade marketing
Once the investment is made and applied appropriate action, It is necessary to measure the economic results generated by different commercial activities. He Return on Investment (KING), It is responsible for measuring these results and, information collected will be more accurate if collected using Technological tools.
Analyze the costs and benefits generated by the PDV will give us an idea of whether the strategy implemented is working, These details will help your company to justify the budget that intended for trade marketing.
Examine captured data presents a wealth of information, matters like trade marketing operations have offered better results, that customer profile has been more receptive to action, points to improve strategy, what percentage of the budget spent on worthwhile trade marketing and other areas where commercial activities, are some of the answers that we get after analyzing a business strategy.
For calculating ROI one trade marketing we will consider:
- a: increase in revenues due to trade marketing operations.
- b: contribution margin of the company (promotions, discounts, samples, etc).
- c: Total investment in full to trade marketing.
These data serve to complete the formula and see if the investment made positive results obtained:
ROI = (a*b)-c/c x100
If activities have been performed in different PDV, formula is applied on each one individually, in order to compare data and thus, analyze the progress of operations on each physical store the rest.
The area where the property is located, distribution of products around the store, the work of the staff and even the type of customer, It is particularly each outlet, the results will be different in each of them and have the opportunity to compare these results, will provide more answers.
A comparative table is a good way to organize this data and see clear the results.
Digitization in trade marketing
As we have already mentioned, the best way to collect data to calculate an accurate ROI, It is using digital tools designed to optimize trade marketing strategies.
Technological development applied in this area, Get verifying compliance with planned activities more proactively by capturing variables, but also, the results of applying technology in trade marketing are also seen reflected in a better shopping experience for the user.
The availability of real time information offered by digital solutions, It allows you to audit and inspect the inputs that affect the department; commercial network, VAT, vehicle fleets, quality control and indoor-outdoor advertising, among others.
Having all this data enables the person responsible for planning future campaigns and operations based on real information of the company itself, in addition to increase the capacity for action if it detects any kind of error or negligence.
Want to know more about how technology will help your marketing strategy trade? please contact us and we will advise.