Study: Kraft Closes In On P&G
say Procter & Gamble is the manufacturer that uses trade promotion funds most effectively, a growing number favor Kraft, according to the 2001 Trade Promotion Spending and Merchandising Survey from Cannondale Associates.
"P&G retains its top spot, but Kraft is right behind with aggressive programming and top-rated planning," said Don Stuart, Cannondale partner.
Forty-three percent of retailers, a four-point drop from last year, named P&G; while 38% cited Kraft, a three-point gain. Rounding out the Top 10 were General Mills, Coca-Cola, ConAgra, Pepsico, Unilever, Nestle, Kellogg's and Kimberly-Clark, respectively. ConAgra, Pepsico and Nestle were new to this year's ranking.
Flexibility, management commitment and innovation continue to be important in terms of effectiveness, the survey said.
"Oftentimes, technology is seen as the driving force, but if the process is not right and the commitment is not there, technology cannot be an effective enabler," said Stuart.
As for retailers, 66% of manufacturers said Wal-Mart has the most effective use of trade-promotion funds. Also in the Top 10 were Publix, H.E.B., Safeway, Kroger, Wegmans, Albertson's, Meijer, Costco and Target.
"Wal-Mart is the leader and will continue to grow in importance as it continues its aggressive grocery push," Stuart said.
Nearly 300 manufacturers and retailers participated in the survey. Questionnaires were distributed in January 2001 to food, health and beauty care, and general-merchandise manufacturers, and also to grocery, drug and mass retailers. The goals of the research were to confirm best practices, explain evolutionary changes and identify key opportunities for improvement.
FDA Targets Herbal Additives
In a move that could have a big impact on companies that market foods with herbal additives, the Food and Drug Administration has warned that "novel ingredients" like gingko biloba, Siberian ginseng and echinacea have not been approved for consumption.
The FDA has already sent warning letters to Hansen Beverage Co., U.S. Mills and Fresh Samantha, which is owned by Odwalla. It also sent a letter to Smucker Quality Beverages for its R.W. Knudsen Family Simply Nutritious Visionade.
The FDA issued the letters in response to the rise of foods and beverages containing herbal ingredients. It said other manufacturers -- both large and small -- should "take note," and that additional letters may be sent.
The purpose of the warnings is to get manufacturers to produce scientific evidence that shows the ingredients are safe.
Kimberly-Clark, Quaker Oats Join Council Jim Baer, promotion services manager, advertising and promotion, Kimberly-Clark, and Robert Pettis, coupon operations supervisor, customer financial services, Quaker Oats Co., have agreed to participate with In-Store Media Systems in its Consumer Packaged Goods Advisory Council.
Len Harris, manager of coupon control for Kellogg, and Carol Haas, director of coupon management, Ralston Purina, are also participating. Formed last month, the council's first meeting will be held this month.
In-Store Media Systems, Aurora, Colo., is an e-commerce company that will provide business-to-business Internet solutions for the coupon industry through two electronic-coupon clearing systems.
PMA Co-Chair Named
Jeff Mellin, director of national accounts, U.S. Marketing & Promotions, Los Angeles, has been named co-chair of the Promotion Marketing Association's In-Store Marketing Council, effective this month.
"Our goal is to develop a council that reflects the unique interests and issues of this constituency," Mellin said.