Q&A with Todd Hanus, Customer Vice President for Sales Operations and Strategy, Kraft Foods, Inc.
Kraft Foods Inc. has initiated a store-level sales and service initiative called Wall-to-Wall, or W2W, that raises the level of service Kraft provides retailers at the store level and increases profitability for both Kraft and the retailer. Kraft’s Todd Hanus, Customer Vice President for Sales Operations and Strategy, discusses this initiative.
Q: What is Wall-to-Wall?
A: Wall-to-Wall is the program Kraft sales representatives now use to work with retail partners. The initial phase of the program involved consolidating our two different in-store sales forces into one with a single focus. Phase 1 was completed in April and now we’re moving into the second stage to enhance the benefits of the initiative in the 16,000 grocery stores selling Kraft product.
Prior to W2W, Kraft had two separate sales rep focuses: one for the Nabisco biscuit brand, which involved Direct Store Delivery or DSD, and the other for warehouse delivered product. Under the old arrangement, a Nabisco sales rep would be in a store two to four times a week and developed good relationships with the store managers because of the frequency of his visits. At the same time, warehouse sales reps were in the store, too, one to three times a month to service their categories. What we did was collapse the two rep programs into one so that one Kraft sales rep is in the store handling all product categories and delivering a high level of service to our Kraft grocery customers.
Q: How does W2W work?
A: Wall-to-Wall takes advantage of Kraft's scale to bring the benefits of the hands-on merchandising of the direct-store distribution model used by Nabisco, while maintaining the lower cost of the warehouse distribution method used in the rest of the portfolio. With W2W, Kraft sales reps can make sure shelves are stocked with Kraft products and work with store managers to promote specific items and put them in special displays to attract customers.
Kraft’s previous system involved paper forms whereas the new system is computerized. Sales reps use tablet computers to keep track of product, promotions, merchandising, out-of-stocks and more and can advise store managers with updated data that can be used to best effect, which ultimately delivers straight to the bottom line.
Q: How is W2W evolving?
A: We’re currently in Stage 2 of the W2W initiative. In this phase, which will be completed in mid-2009, Kraft optimizes the new structure by providing reps with easy tools to guide them through the store so they can provide sales opportunities to the retailers.
Now in five of 14 regions of the country, optimization will continue for the next year or two. We’re working to develop collaborative plans with our retail partners and maximize sales and profit results for both. Kraft reps are spending a lot of time in store, understanding the power of the portfolio, and providing wall-to-wall services across all 60 Kraft categories to enhance the retailer’s business. These reps, about 2,800 in all, are becoming trusted advisors to the local store management team and we want to build on that success.
With Phase 2, we provide sales reps with the tools they need to guide them. As I said, the system is now computerized and includes all the information the rep needs to effect the best possible result for the retailer, from sell sheets and planograms to new product information, upcoming circulars, voids, out-of-stocks, meal solutions and more. The computerized tools deliver a set of activities by category that the rep needs to complete so both Kraft management and each individual rep knows what the rep needs to do in-store. A computerized application guides them through each action. It guides them through the DSDP (Display, Shelving Distribution and Pricing), giving them priorities, a tool that combines all of the information – even with a button that says pending.
Q: How does W2W impact grocers?
A: Through W2W, Kraft has a knowledgeable sales rep in the store on an ongoing basis who knows all of the company’s products and programs, as well as the retailer’s store, sales and merchandising objectives and the marketing plan. The manager has a go-to person he is familiar with and both are able to move on merchandise and sales opportunities quickly to optimize the sales benefits. W2W provides constant attention to the Kraft portfolio to drive revenue and profits at the store level.
Q: What has Kraft learned from the W2W model that it will apply to other areas of its business?
A: There are a number of key learnings: one is around training. Well-trained people are an asset to Kraft and to our partners. The W2W program involves a continuing training environment. We’re planning a Core Mastery program for the sales reps so that they can be at the top of their game. This Core Mastery program will require certification on a yearly basis. Everyone in the field will have continuous, ongoing training. We will continue to train, monitor and manage. The training and tools have made the reps comfortable.
Also through W2W, we’ve found the program provides our sales reps with more selling opportunities. Going W2W has definitely energized the vast majority of our sales reps. They feel more a part of the total Kraft team and they want to drive the total Kraft program.
Q: How are new product introductions being affected by W2W?
A: The key is that with the reps in store every week that new products will be on shelf quicker. The sales reps ensure that every sku is on shelf when it needs to be there. The huge benefit in that is that new items have a definite impact on revenue by getting them on shelf quicker.
Q: Have there been any unexpected benefits of the program?
A: During the optimization process that we’re working on right now, we have found that investing additional hours with key customers willing to partner with us is driving significant revenue performance beyond what we expected. As customers embrace the concept we deploy more hours via the rep and the results have been very solid. The optimized program is exceeding expectations.