Cooperation’s Effect on Incrementality Measurement: A perspective on CPG Industry

The CPG industry or Consumer Packaged Goods industry operates and provides for customers across multiple geographies. Every business needs assistance from the right people/entities to sail through the supply and demand seas. Now, this brings into the picture the fact that cooperation between entities plays an essential part in the smooth functioning of processes and enhances revenue streams by bringing in more opportunities. If you are someone from a marketplace looking for more manufacturers to join the fold and boost your inventory, then bear in mind that establishing the right relationship with the manufacturer is the key.

Incrementality measurement forms a crucial aspect of the campaign an organization runs. To put it simply, the last touchpoint determining a conversion helps in the calculation of the success/failure rate of a campaign. While digital marketing has its fair share of challenges, CPG industries have already dipped their toes into this realm. CPG in its own right has a scale to balance, now this scale comprises of a manufacturer and a seller. Balance them the right way and you’ll have a steady flow of returns.

But what about the factors that drive a balance between the manufacturer and the seller? How does it affect cooperation? And how does it eventually impact the incrementality measurement side of things? Fret not for you will know it all by the end.    

Trust and Cooperation are important, actually!

As stereotypical as it sounds, trust is what drives sales at the end of the day. If you focus on retaining your customers rather than leaving them be while searching for new ones, chances are you’ll attract neither. If you’re a potent member of the CPG industry then you already know the wonders that trust sprouts with the passage of time. In fact, trust and cooperation are crucial aspects of driving incrementality measurement.

Here’s how:  

Zero restriction on data flow

At the end of the day, data is what determines and drives things ahead in this digital world. If there’s a restriction to the flow, it’ll often result in situations that drive results toward the negative side of the spectrum. Cooperation between the manufacturer and the seller (a marketer/marketplace here) allows a smoother flow of data. With a rich stream of data, the right insights for the right audiences can be extracted, resulting in better last clicks and subsequent conversions.

Enhanced transparency between parties  

Now that the importance of streamlined dataflow has been established, another associated benefit that stems from cooperation is transparency. For the most part, sellers often hide the right margins and pieces of data from the manufacturers, and vice versa. This more often than not gives rise to malpractices that plague the relationship between the manufacturer and the seller. Cooperation between these two parties gives rise to better transparency and an emphasis on the data being shared. Not to mention with transparency established in the right manner, you increase the chances of onboarding more manufacturers to fill your inventory.

Setting the right competitive prices 

Another perk that comes with cooperation is the ability to set the right prices for your products. The right flow of data and the subsequent generation of insights enables the seller side to establish the right prices for their product lineup. This enables the seller to take into account the right guidelines set by the manufacturer as well as set up the campaign in a way that supports the manufacturer’s product lineup. And it also establishes the seller’s brand image in the market and drives more customers. It is a win-win situation for the seller as well as the manufacturer.    

How not to be a good example of incrementality measurement, a CPG example

Way back in the early 2000s Walmart initiated a practice that eventually led to a downfall in its relationship with CPG manufacturers. Turns out that Walmart, in its bid to gain more profit from its sales pulled manufacturers down. The flow of data that was supposed to establish a cordial relationship was compromised from Walmart’s side. This led to manufacturers backing out of deals with Walmart and leaving the inventory devoid of products to sell. To add fuel to the fire, Walmart’s aggressive pricing methods also forced manufacturers to terminate their relationship with the retail giant.

This move led to bad incrementality measurement scores, coupled with poor sales records and backlash from manufacturers and customers alike. Cooperation or the lack thereof became the key reason for this entire ordeal. Walmart became a bad example for the CPG industry in general. They did eventually improve upon the mistakes they made though.

To sum it up    

Every marketing strategy involves playing the right moves at the right time and place. The CPG industry benefits from incrementality measurement as it helps the marketer understand the demographic and the way to woo it. However, data collection is experiencing a paradigm shift, the idea of a cookieless world is being brought to reality.

If you’re someone looking for a way to board the cookieless world and the future possibilities it holds then Cubera is the name to choose. With a state-of-the-art algorithm lineup that assists publishers and advertisers achieve their marketing goals, it is high time to step out of the box and witness the AdTech revolution firsthand.