Tyson Foods was facing rising trade promotion costs and inconsistent retailer results from its trade events. It lacked predictive modeling, real-time spending data, and post-event analysis. Tyson implemented DemandTec's Trade Planning & Optimization software to align new business processes with retailers. This provided consistent successes through shared clarity, improved sales plans, and event analysis. Tyson saw dramatically raised case volumes, trade ROI, margins, and retailer profit as a result.

1. A DemAnDTeC CusTomer suCCess sTory
Tyson Foods Optimizes Trade
Effectiveness with DemandTec
CusTomer oVerVIeW Challenge
Tyson Foods, the world’s largest processor and marketer of chicken, beef and pork, knew it
Challenge
needed to drive better trade marketing effectiveness as a category leader. Promotion planning
Retailer gains were inconsistent on
was inconsistent, retailer demands were escalating, and trade dollar spending was rising.
trade events. With little post-event
analysis or predictive modeling, Tyson reassessed its entire approach – process, systems and people. It was a first major
Tyson drew fewer bites on future step to improve trade promotions through superior planning, execution and analysis. Tyson
promotions. reasoned that if retailers could readily see how trade events benefited them, and could be part
of a collaborative process that made events “more theirs,” they’d buy in more regularly.
Solution
The company’s self-scrutiny turned up some key gaps in trade promotions. Michael Shinstine,
Powerful Software-as-a-Service
Tyson’s Senior Director of Sales Planning, highlighted these gaps at the Consumer Goods
application aligned new business
Technology 4th Annual Sales & Marketing Summit:
processes with retailers. Consistent
successes sprang from a newly
n Rising costs. Trade spend and execution costs were rising, as were retailer demands,
and costs of goods and fuel, which pressured performance. Offering little relief, Tyson was
shared clarity, better sales plans and
inconsistent in its approach to events, and did not involve its customers in planning.
event analysis
n Insufficient data. Real-time spending updates were impossible with spreadsheet data.
Key Benefit
Syndicated data was hardly used. The absence of post-promotion analysis meant few
Tyson soars with DemandTec’s Trade
valuable insights followed events.
Planning & Optimization service and
dramatically raises case volumes,
n No view of the future. Because Tyson couldn’t predictively model future promotions, it
was more reactive than proactive.
trade ROI, margins and retailer profit.
n Rigid technology. Tyson’s inflexible systems limited promotion planning to its own fiscal
year, rather than more appropriate customer timelines.
n No empowerment. Tyson teams often lacked the authority, selling experience and sales
planning abilities to ensure powerful programs.
solution
ComPAny snAPsHoT Tyson undertook a one-year plan to dramatically improve its approach. A broad self-
n Revenue assessment began in September 2005. By December, the company was accurately sizing how
US$26B much more effective trade spend would deliver, through its tighter grasp of total ROI across the
business, and performance by account, by event and by promoted group and SKU.
n Market Sector
Food production and distribution Tyson uncovered several key findings, said Mr. Shinstine:
n Geography
n Significant opportunity existed. Since it varied by customer and product, a tailored
approach was necessary.
Global
n Most promotions were positive for customers but negative for Tyson. This would soon
improve with knowledge of which products to promote together rather than separately,
and with Tyson’s new capabilities for pre- and post-analysis and predictive planning – all
enabled by the Trade Planning & Optimization software service.
www.demandtec.com

2. CusTomer suCCess sTory
Another plus was vendor-retailer collaboration based on a shared understanding of consumer
demand. Putting the consumer at the center of the trade planning equation helped Tyson
focus on what mattered most – driving the right consumer behaviors to maximize total category
objectives, not just total Tyson portfolio metrics.
Tyson soon attained a leadership position in trade promotions, with tailored strategies and
events that grew retailer categories and Tyson brands. To achieve this, Mr. Shinstine said he
sought a best-in-class technology partner that was:
n Easy to use. The interface needed to follow current work flow. Sales planners had to be
“Tyson benefited immediately
able to use the system intuitively. The system needed to build events the way Tyson plans.
It had to develop a predictive category plan vs. a brand plan, and quickly build proposals. from more powerful, predictive
n Based on superior insights into consumer demand, with higher forecast accuracy. and analytical trade events.
Optimal planning yielded
n Scalable, and able to model all categories.
38.7% greater contribution
n Lower risk. Software-as-a-Service delivery minimized Tyson’s IT burden.
and 13.7% higher trade ROI.
n Enhances collaboration opportunities with retailers.
Trade spend became 5.2%
DemandTec’s Trade Planning & Optimization software service met these criteria. This, along
more efficient, and case
with reconfigured business processes and better-trained teams, had Tyson ready to fly.
volume rose by 3.4%.”
Benefit
By upgrading its trade promotion planning process, Tyson achieved significant brand and Michael Shinstine
Senior Director of Sales Planning
category improvements and developed a more meaningful way to engage with key customers.
Tyson Foods Inc.
In a case study presented by Mr. Shinstine at the Consumer Goods Summit, Tyson found that
promoting its Boxed Wing product at one retailer yielded unfavorable results for the brand. The
DemandTec software guided Tyson to shift ad dollars from the boxed product to the bagged
line, and buy a two-week display instead. Performance improved in many ways (see table):
PREDICTIVE ANALYTICS LIFT PLAN PERFORMANCE
Metric % improvement vs. initial plan
Case volume 0.6% Flat volume
Trade spend 0.3% Flat spending
Increased contribution margin 16.1% Significant profit gain
Manufacturer trade ROI 16.4% Better ROI
Retailer profit 1.9% Retail profit increase
Source: Tyson Foods, 2007
Proactive leadership like this earned Tyson the prestigious 2007 Category Captain Award
from Progressive Grocer. Mr. Shinstine said upon receiving it, “This software has allowed us
a much more consumer-centric approach to promotions, creating wins for Tyson, retailers and
consumers.” Optimized trade promotions have produced differentiating gains and a stronger
platform of trust and credibility with retailers.
Learn more
For more information, call 1-888-221-6128 or visit www.demandtec.com.
DemandTec, Inc
1 Circle Star Way, Suite 200 n San Carlos, CA 94070
tel 650.226.4600 n fax 650.556.1190
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Trade Effectiveness, DemandTec TradePoint Network and the DemandTec Platform are trademarks of DemandTec, Inc. All other trademarks mentioned in this document are the
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property of their respective owners.
09/08