By Heather Burgess, Simpactful Senior Partner
The pressure for topline growth, continued pricing dynamics, competitive challenger brands, high fiscal expectations from shareholders, and retail stakeholders is real. It is driving most Consumer Products Companies to spend time with their leadership teams to take a critical look at business strategies and Where to Play and How to Win choices. The Simpactful Partners are seeing a concentrated focus by Senior Executives on defining opportunities to step-change business performance vs delivering smaller, incremental gains across companies of all sizes.
With this, commercial leaders are beginning to consider the need to “restage” some aspects of their business. However, this quickly gives rise to anxiety and apprehension – and it’s no wonder. In 2022, BASES published its Brand Renovator Report. BASES refers to a brand change that’s initiated by negative sales as reactive renovation. Brand renovations can be accomplished with a combination of tools:
- Revamping commercial and channel choices
- Evolving brand strategic equities and brand identities
- Overhauling brand business models
- Adopting new assortment and price pack architecture approaches
- Revamping innovation strategies and plans
- Supply chain agility breakthroughs
The fear of failure is warranted. While restages are often necessary to course-correct, BASES reports that 90% of considered restage executions fail to reverse a negative sales trend on their own (that is, without an accompanying increase in marketing support). These projects are significant in scale, and it is critical that leadership teams not only develop sound strategies, but that the plans are executed with excellence from operations through in-market execution.
Our team of expert multi-functional practitioners has helped with major projects across the full spectrum of restage combinations from both the Brand and Retail sides, and we have picked up some helpful tips:
- Don’t Wait Until it is Too Late. Restages take time. Leaders must stay on top of financial performance, retailer and consumer sentiment, and continually weigh the risks and rewards of chartering a restage. Loss of shareholder, consumer or retailer trust can be catastrophic. In the words of Bob Cinq-Mars, who spent his career climbing the merchandising ladder within Walgreens, “Once distribution cuts have been announced and a buyer has made the decision to partner with other brands, it can take years to rebuild trust and a willingness to partner again.”
- Save Time and Money with the Right Team. To avoid becoming part of the “other” 90% which can have catastrophic consequences or go through painful rework cycles on crisis timing, it is helpful to have access to a team of resources with the practical experience in successfully restaging various aspects of the business. Many restage plans have looked pretty on paper, but in-market execution is everything. It can be quite challenging for stretched teams to take on the added work of planning and executing a brand, channel, or business model renovation, all while managing the day-to-day business. It is common for inexperienced practitioners to miss critical steps or assessments required to deliver in-market success and quality creative partners are essential in many instances. Simpactful offers experienced practitioners and agency partners who have tackled, led, and received this work from all angles. In the service of clients, we have not only designed restaged, but have developed the retailer pitch decks to sell them in. Because of this, we have the experience to work faster, help connect dots, anticipate needs, and think through to execution.
Simpactful not only offers experience and expertise, but capacity to manage the integrated project or pieces. Simpactful teams have shaved 12-15 months off restage timings in numerous instances. Effective leaders critically assess how quickly projects need to move, and whether they have the right experienced resources and sufficient capacity to take on a successful restage. If not, they invest in short-term support to avoid making long-term mistakes.
- Focus on the Business Model and What Must Be True. Starting a restage analysis with a 5C assessment, trend and future forces deep dive, a business model canvas, and thorough financial modeling can uncover opportunities for risk and vulnerabilities to shape the scope of any restage. Earlier in my career, I was working on a brand that was clearly in crisis. However, it was not until I applied these principles, and uncovered a concrete $30MM profit forecast risk, that I could get support to restage the business. I took away the importance of assessing the full risk of both the “act” and “do nothing” options from multiple angles to understand the risks and rewards.
- Go Deep on Retailer Needs Before Locking Scope. Simpactful’s team of Retail are regularly pulled into projects to provide their personal perspective as well as to leverage their networks to ensure Retailer requirements are included in the business model – and ultimately a restage scope. For example, our team recently met with current and former buyers within a client’s top retailers and channels to evaluate what would be required to deliver a price increase. We uncovered insights that shaped the product strategy, the channel mix requirements, and supply chain needs.
- Employ Brand Building Best Practices. When you are updating a brand’s equity, iconic assets, packaging, in-store or marketing, it’s important to get it right. This means starting with a clear consumer strategy, designing for consumer decisions that are often made in milliseconds, and combining expert judgment with the right consumer learning tools. Simpactful offers practitioners who have codified best brand-building, innovation and in-store transformation practices, trained thousands of employees at some of the world’s largest Consumer Products Companies and managed all aspects of the business. Together, we have successfully restaged dozens of brands in Beauty, Home Care, Fem Care, OTC, House Wares, Laundry, Baby Care, Food and Beverage, and more across various channel models. As a part of this work, we have developed and implemented learning plans to reduce risk and drive success.
- Don’t Delay Planning for the Operational Details. Once you have a clear vision, it can be tempting to rush to get the new product onto shelf or into new doors. However, the devil is in the details. Simpactful’s team of practitioners has managed through executional details like inventory run-down plans, start of production, financial assessments, retailer engagement, store and online transitions, hard vs soft conversion details, and financial modeling can be the difference between a restage that delivers the required brand and financial improvements or failure.
Do you need help with a brand, business model, channel, product and/or operational restage? Simpactful can help! We are happy to roll up our sleeves with you to do the work and to train your teams. Contact our team today at contact@simpactful.com or 925-234-6384.
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