NEW YORK -- Ocean Spray Cranberries completed another step in its "evolution" toward customer marketing this summer with a shift of its field organization from four geographic divisions to five.
In the process, the Lakeville, Mass.-based grower cooperative has transferred greater account-management responsibility to the people who work closely with individual accounts, said Rick McDermott, director of trade marketing for Ocean Spray.
"We now have five of what we call division merchandising managers in division offices all throughout the country. Their job is to tailor the tactical side of the plan to the accounts within their area of geography," he said.
"In addition we still have what we call a trade development side. Their jobs have been to champion and push forward the customer marketing process. But we have turned over responsibility for planning to the field -- to our brokers and field sales."
McDermott made his remarks at a conference here on "Account-Specific Promotions," which was organized by the Strategic Marketing Institute, New York. He described how the grower cooperative, which will do just over $1.2 billion in sales for its current fiscal year ending this month, has moved incrementally toward field-based account management and planning over five years.
Ocean Spray established its trade marketing function in 1989, he said. It moved to "consultant-based" customer marketing in 1992 and established its trade development department in 1993, bringing the process in-house.
Under its current structure, Ocean Spray's field organization is backed by three category managers at corporate, he said. Their job is to work with the marketing department, to identify the trade promotion strategies, to integrate the trade promotion strategies into the marketing plans, to negotiate the trade budget with the brand, to allocate the trade budget with the divisions and the field level, to write a national promotion plan and to manage the dollars as the year goes on.
"We just completed in January a system which combines IRI [Information Resources Inc.] data with our own internal data," McDermott said. "So we can now within the same database compare consumption information and syndicated service information, with our own shipment data, our own promotion cost data and a whole variety of internal information."
As Ocean Spray moved to more joint planning with accounts it tried to plan by cycles, beginning quarterly at first, then moving to six-month planning horizon. Except for a very few customers, McDermott said he doubts that it will move to longer planning time-frames.
"We are dependent on information about the crop," he explained.
Shelf-stable juice is a hot category which is still largely owned by the grocery class of trade, and it is both growing and profitable. Ocean Spray has tried to present its products in that context as a solution to retailer problems, he said. He added: "We have been very successful to the point where we have now turned over the responsibility for six-month planning to the field -- to the brokers and to field sales. We are trying to build regional sales manager and broker ownership over the entire planning process."
McDermott, said it was important for brand marketers to regard the changeover to account-specific marketing as an evolutionary process.
"I don't believe you can go from running FSIs [freestanding advertising inserts] and in-store type things, directly into account-specific marketing, because there is too much involved. There is too much training involved, too much data involved, and there is too much development of the accounts involved," he said.
"What we hope to do over each six-month successive program is to integrate more data, more sophistication of data into the process. We try to integrate more promotion techniques into the process. We try to challenge them to do a better job with promotions and with planning each time." McDermott said that Ocean Spray is satisfied that its shift toward account-specific programs has made its trade promotion both more effective and more efficient based on recent growth of its brand consumption and share.
"In cranberry drinks, our business -- which was big to begin with and well-supported to begin with -- is up over 20% year to date since September [10 months]," he said. "It is about the same on our grapefruit business."
At the same time, McDermott said, the company is spending a lower cost per incremental case, which is how is has chosen to define efficiency in the trade plan.
