Gathering, managing competitive intelligence: Q&A with Competitive Promotion Report SVP Scott Hanslip

We have all heard the expression “knowledge is power.” Conversely, it also is true that what you don’t know can hurt you. The good news is that it’s not hard to find out what your rivals are up to and outpace them if you can connect with the right sources and utilize proven solutions. Fact-based competitive intelligence can drive a brand’s strategy and allow marketers to make real-time adjustments that provide a competitive advantage in the marketplace. Before NACDS Annual Meeting, Drug Store News sat down with Scott Hanslip, SVP at Competitive Promotion Report, to get a better understanding of how health, beauty and wellness manufacturers can tap into unique and proprietary competitive intelligence to help drive the business.

Drug Store News: How do companies today track competitive intelligence?

Scott Hanslip: Tracking and gathering competitive intelligence remains in the stone age as companies react to competitive threats, new products, package and ingredient changes, and, of course, published list price increases and decreases. Marketers and sales organizations continue to chase down products already in the market and then — hopefully — respond to them during category reviews if given the opportunity to meet with the customer.

Manufacturers run to retail, gather new products and share [them with] their internal teams before reacting. None of these steps are really needed given the benchmarking and tracking services available to manufacturers today. With [more than] 60 different health, beauty and wellness categories to track and monitor, CPR offers their clients more than 10 years of list price history, and provides actionable strategic pricing insights and trends that can support the need or rationale for item list price changes and/or help establish list pricing for new items. The trends often are predictive both in terms of timing and rate of change.

An analysis of the CPR database shows there were approximately 7,200 list price changes during the past 12 months. This represented 5,800 list price increases and 1,400 list price decreases. List price increases averaged 4.6% while the decreases averaged 15.9%.

DSN: How does CPR gather this set of pricing information?

Hanslip: CPR has been tracking and monitoring published list pricing and list price changes and general trade allowances for the past 28 years. The database is structured to benchmark [more than] 60 different categories and [more than] 60,000 UPCs. The general data feed comes from an extensive network of wholesalers and retailers in food, drug and mass, excluding Walmart, club and dollar stores for obvious reasons. It is a total U.S. database and includes both national brands and private label.

HBW manufacturers should be aware that many of the leading brands already are using CPR’s services to benchmark price and track their competitors’ list price changes. CPR also provides many clients with retail price, retail-price changes and also can use our list price with our retail price to provide them with retail margin information across food, drug, mass and independent channels. Separately, using POS data — Nielsen or IRI — with CPR trade pricing and promotions data allows CPR to provide our clients with customer-level margin and optimization insights, such as trade spending analysis, brand profitability comparison analysis, portfolio optimization and much more. These insights provide our clients with a unique financial perspective of the business, and allow them to engage with the retailer on a different level.

DSN: With the healthcare industry moving closer to a margin/productivity metric in terms of performance, what role could CPR play in this transition? What’s the bottom line?

Hanslip: The greatest challenge for manufacturers today is seeing beyond their own portfolio. Today you can no longer afford to just know what margin dollars you are producing for the customer. Manufacturers had better quickly understand the entire competitive landscape before making a recommendation on assortment decisions just based on unit turns or top-line dollars. It’s about making ‘real profit dollars’ for your customer. Balancing the role of private label and core national brands also is critical to ensure pricing is not eroding margins and/or price gaps are too wide or too narrow, negatively impacting customer ROI.