Bain: We view in-store execution as a key growth lever for consumer product companies. In this video, we sat down with executives from global consumer product companies to discuss their experience in sales execution in emerging markets.
What led you to focus on sales execution?
Nico Nusmeier, regional president for Central and Eastern Europe at Heineken: The sales execution program at Heineken, which is called “The Extra Mile” and which we designed here in Central and Eastern Europe, has been set up precisely to focus on sales execution. We wanted to make sure that what our sales reps do at the point of sale is well linked to our company’s strategy.
Kostas Vlachos, managing director at Kraft Foods Turkey: We started the program about a year ago--after the acquisition of Cadbury--when we were faced with the challenge of matching the category. Having three impulse categories at the same time makes it more and more important to look at what you’re doing actually in the store and how much effort and attention you are putting into the presence of those stores, as well as into the visibility of the product.
Alex von Behr, senior vice president for customer development at Unilever in Asia, Africa and Central Europe: While we’re a very strong company in terms of consumer-focused innovation, a passion around sales execution in the outlets was lacking, and in many ways the outlets were seen as the end of the value chain, with less significance. The way to address this problem was with a structured approach: defining what the outlets need for the category to grow--from a shopper’s perspective; thinking about how to execute that in terms of providing incentives for the sales force; and, very important, measuring it, because what gets measured gets done, as we know. So by putting these ideas together in a simple, understandable way, we’re able to really bring focus to this part of the business in this part of the world, where we’re dealing with literally millions of outlets.
Heineken’s Nusmeier: Seeing the difference between what you think of on paper in terms of your marketing and your general strategy, and then going into the field and discovering that your sales guys are executing something else led us to think, How can we change that? You really want to measure what they’re doing because what you cannot measure, you cannot control. What you cannot control, you cannot target. And what you cannot target cannot be a real part of your strategy.
Bain: Describe the program’s cornerstone concept.
Kraft’s Vlachos: The most powerful concept is a change in mentality. You enter the store, and you’re not thinking anymore about today’s sales. Instead, you’re thinking about what you will do today in order to create sales tomorrow.
Unilever’s von Behr: Unilever’s Perfect Store Program is extremely powerful because it’s based on three principles that work. The first is to really understand what it is that shoppers want. Be clear and simple about that. Second, it’s based upon simple steps to execution. Most of our business in emerging markets—despite the growth of modern trade channels—is still in general trade. And there, the ability to execute a few things simply is key. Third, the ability to bring simple measurement, which is immediate, is absolutely vital. We know, for example, in Indonesia, the day after a salesman’s been to a store whether it’s perfect or not—whether we’ve executed those few things well. Keep it simple. Drive it with passion. Measure what you’re doing, and that’s the secret to success.
Heineken’s Nusmeier: One of the key elements is that we give our sales reps a focus, a limited set of activities—anywhere from three to five activities that people should execute in their stores. The second key element of the program is measurement of the results that we want to focus on. The combination of focus, measurement and continuous feedback of results is the key element for any successful sales execution program, in my view.
Bain: What sort of results have you seen?
Kraft’s Vlachos: We started with a gum category a few months ago, and in seven stores where we are tracking like-for-like sales, we have seen up to 10 percent volume upside.
There’s another side of this success, which has less to do with measurement. I see every day, more and more, our sales team being happier, being more motivated with what they are doing, and having simpler, but at the same time, more successful lives. So it is about sales development, but it’s also about people’s satisfaction with what they are doing.
Unilever’s von Behr: We’re on a journey with this program. In 2010, we had about a million stores out of five million—which we visited either directly or with our distributors’ sales reps—that we were working on to turn into perfect stores. And we have ambitions to take this program forward this year and next year. Our own sales people now are very clear about what they need to do within the outlet, going beyond taking the delivery and checking the inventory, and actually executing because their actions are being measured and they’re getting rewarded accordingly. Our distributors are also learning that the business is much more than delivering the stock. So everyone within this system is seeing the benefits of operating perfect stores-- in terms of the numbers, in terms of growth rates for our customers, and in terms of our distributors’ margins.
Heineken’s Nusmeier: In my perspective, sales execution is the most important element of a comprehensive marketing and sales strategy for consumer products. That is because, at the end of the day, the battle is won at the point of sale. What we like about this program is obviously the results. We see the results in terms of market share. We see the results in terms of distribution. We see the results in terms of rotation. Of course, it’s a multiyear commitment to do something like this—and I’m talking about continuous improvement. That means continuous improvement over a number of years, and actually, in principle, sales execution never ends so this is a system which can be used for eternity.
