NEW YORK -- Food brokers are enjoying an increased role in brand marketing decisions and are expecting that role to continue to grow.
"With fact-based information, we've been able to show manufacturers that coupon activity is not necessarily a good idea within certain categories and that those funds ought to be redirected locally into other sales, marketing and merchandising programs," said Mike O'Connell, executive vice president of marketing for M&H Sales & Marketing, Tarrytown, N.Y. "That means we've been able to access a huge pocket of money that was geared toward coupons."
O'Connell was on a panel of brokers who spoke March 24 at a meeting of the New York Market Radio Broadcasters Association here. The panel told the radio station salespeople to count on dealing with brokers more often, and that brokers have already created marketing changes.
O'Connell said brokers track the coupon information and tell brand marketers who don't see "spikes in sales" after coupons are distributed to explore other avenues. "We've been able to show some manufacturers who traditionally run four or five coupons a year that they can run two or three coupons instead and put the rest of the money spent on coupons into alternative efforts such as radio and charity events. Coupons will never go away," he said. "But more manufacturers are realizing there are other options." He said the Efficient Consumer Response strategy being implemented in the industry will place more emphasis on consumer-oriented and local market promotions.
"It used to be the marketing people of national manufacturers sat in ivory towers and developed national marketing programs, one-size-fits-all programs," he said. "They dealt them out to their brokers across the country like cards and said 'here they are, go sell them.' Sometimes they worked. Sometimes they didn't. That's changing dramatically and rapidly."
Another speaker, Jim Lavin, director of marketing for Ferolie Corp., Englewood Cliffs, N.J., also said brokers' roles continue to expand. "Food brokers are becoming a value-added aspect of the marketing chain," he said. "A manufacturer doesn't have the time or budget to find out about ECR. We have no choice but to be well aware of it and any other new industry trends because we're involved with them every day."
He said new technology has put valuable demographic information at brokers' fingertips and allows them to have the right information needed to interact with manufacturers and retailers. His company has six analysts measuring sales data, he added. "Eighteen months ago none of this information was available. Eighteen months ago we had no analysts," he said. "There's no blue smoke and mirrors like there once was."
O'Connell said brand managers are finding this information increasingly helpful. He said that's creating a trend of moving decision-making to the local level.
"Historically, food brokers had very little to say about how consumer promotion money was spent," O'Connell said. "That's changing. Manufacturers are saying to us 'you know the New York market. You know the consumers. You know what works and what doesn't work. Tell us how to spend our consumer promotions money."'