RDs Should Fight For Those Promotional Dollars, CPGs Will Thank You

RDs Should Fight For Those Promotional Dollars, CPGs Will Thank You

September 28, 2016
Phil Lempert
Business Skills

By Phil Lempert, RDBA CEO

As the role of the Retail Dietitian continues to evolve, more retailers are developing RD programs that need to be funded through CPG companies and trade groups in order for them to become reality. It’s important to remember you are looking for partners, not just dollars. The vendors you work with have only so much budget and at times your programs may be battling more traditional programs offered from your buyers, merchandisers and marketers who may have long term existing relationships with these suppliers. Vendor partners are looking to build a relationship with you in order to capitalize on the promotional clout that you have with your shoppers. You both win when you create a successful program. How can you get your fair share of these dollars to promote your programs?

Here are some facts and ideas that may help. According to Nielsen more than $500 billion is spent on trade promotion each year globally (which is the largest area of spend after cost of goods sold); and their new three-year study found that brands invest 20% of their revenue in such programs; and these promotional programs are not working. 72% of the U.S. trade promotions in 2014 did not break even – a stunning fact that can be used to shift dollars to your health & wellness programs.

Nielsen’s Trade Promotion Benchmark Database lists 71 categories from the most efficient to the least efficient, and diabetic promotional events rank as the 19th most efficient with an approximate success of just under 50%.

Ineffective promotions hurt the entire store and the brands that support them. With vendors searching for more efficient marketing and relationship building programs with consumers, there is no better time to promote your targeted health & wellness promotional efforts. 

You need to differentiate your promotional program. Your goal is to tap into new dollars rather than just shifting existing promotional dollars allocated to your store or chain. We know from IFIC’s 2014 Food & Health Survey that “healthfulness” now ranks as the third most significant impact on shoppers decision to buy foods and beverages (following taste and price respectively) which has jumped 15% since 2010. The IFIC study also reports that the healthfulness impact increased across all age, ethnic, education and socioeconomic groups and when asked what sources they would trust the most to provide accurate information about issues related to food and health, the majority identified health professionals (such as RDs) as the top trusted source for nutrition, physical activity and weight loss. This is your opportunity to offer a vendor a more loyal shopper and effective program.

Remember to promote your important and highly valued relationship with consumers to help separate your program from other traditional programs. Of course your list should include in-store tours and culinary demonstrations, signage, coupons, educational materials, eNewsletter ads, special RD chosen product displays; but also think outside the norm to include vendor sponsorship opportunities outside the store with community outreach in events, schools, sports events, businesses and churches. Develop programs that are targeted to moms, specific ethnic groups and seniors – the more specific your program target is, the more likely your vendor partner can secure new dollars to support these consumer segments.