TCC, a worldwide leader in retail marketing promotions, is helping leading grocery supermarkets drive shopper footfall and spend through voucher collection offers and reap lasting customer loyalty as a result.
Here in the UK, 2012 has seen the top four grocers launch significant price promotions, but with shoppers trying to control their budgets, a recent ICS study showed most consumers are sceptical about price wars, and found customer retention will be critical in the future growth and sustainability of retail businesses. Meanwhile in today’s cash-strapped climate, TCC’s marketing promotions are proving to be the tool of choice to foster attachment and win repeat business, giving consumers a compelling reason to shop with one retailer rather than another.
TCC’s schemes such as voucher collection for rewards are addictive and deliver real customer value. Their UK clients include Tesco, which is harnessing the power of voucher promotions in the UK and Ireland and has teamed up with TCC to launch campaigns that reward shoppers with big savings on branded cookware and glassware, and now quality Swiss luggage. In Europe their client Eroski, the Spanish retailer, deployed a customer marketing campaign based on collecting dinnerware to grow market share and increase fresh food sales. Italian supermarket chain Conad is celebrating after the success of a recent short term promotion featuring the colourful children’s collectable characters the ‘Goodness Gang’, which increased average spend on fruit and vegetables by 14% and average item value by 11.7%, and in the US Supervalu drove sales at its Albertsons and Jewel-Osco stores with reward-based campaigns, the latest one offering cookware.
TCC has also used marketing promotions to create in-store theatre and drive engagement by tailoring promotions around special events, as they did for Rewe in Germany with its FIFA World Cup 2010 campaign featuring trading cards of the German team, which gave away over 110m cards and sold over 1m albums in the first four weeks.
And it’s not stopping there. TCC’s latest European promotions run across a wide range of categories including kitchenware, sport, luggage, textiles and jewellery. The Grocery Trader spoke to David Ringer, General Manager of TCC for the UK and Ireland at their Heathrow offices.
The Grocery Trader – David, as General Manager what do you do day to day?
I am the General Manager of TCC for UK and Ireland. We have businesses with office infrastructures in over 20 countries. My job entails the introduction, delivery and smooth operational running of effective short-term retail marketing programmes to UK and Irish retailers. It’s a worthwhile job, diverse and rewarding.
GT – What did you do before this?
Before joining TCC I was MD of a subsidiary of Waddington’s, and my previous career was in FMCG marketing.
GT – Who are your key people on the retail side?
We have over 100 people here in the UK. We have built up great teams covering programme management, design, innovation, new reward development, new solutions development, programme measurement for clients, logistics and supply chain. On the retail side we have very many strong people. The others in the management team are Charles Croft, head of sports and entertainment campaigns, Mark Featherstone and Mike Davis, both main board directors.
GT – How do you sum up what TCC does?
We offer retail marketing programmes that attract more shoppers, increase their spend and keep them coming back for more. We design programmes that increase total store sales by improving frequency, average transaction levels and other crucial KPI’s.
GT – Do you handle the entire promotion?
Yes, we do. Our services include campaign design, reward sourcing, creative services, including design and production, programme management, measurement and analysis. Often a client wants a campaign, but doesn’t have the resources. With us involved, clients’ teams don’t need to expend time and effort, as we have everything here to run the campaign for them. We handle the whole rewards supply chain and make sure containers get to the customer’s DC in time, and work with store managers and regional managers to train store staff.
GT – Is what you do the same as sales promotion?
Our programmes increase sales profitably, so I guess the aims are the same. The key difference is that our programmes are measurable against specific sales objectives, provide an ROI and are fully financially robust. In a lot of general sales promotion activity this is not the case. It’s rare to find such in depth measurement in any other agency operation – most agencies don’t ask for and get our level of data.
GT – What kind of results do you achieve?
We can help achieve significant changes in consumers’ perceptions of, and loyalty to, the retailer. Our coupon collection projects also deliver improvements against measurable targets in terms of average basket size and purchase frequency, which can be objectively measured as part of the client’s internal process.
GT – Do you work alongside advertising agencies? Who takes the lead?
We are happy to collaborate with ad agencies, but in most of our work with the major retailers we work with their in house teams. Where there is an agency in place, they lead the marketing and advertising but we construct and implement the promotion, including sourcing the merchandise and rewards. Sometimes we work with retained agencies who handle all design, and follow their guidelines. It’s very harmonious.
GT – How long do your campaigns last?
Our campaigns usually last 12-18 weeks. It depends on the client’s objectives: a long term project locks in the client for up to four months, and a short term project for perhaps seven weeks, depending on the frequency of store visit and average transaction value that you want to influence.
GT – You recently held an event in London for European and UK clients. What were the key messages?
The general takeout was that the challenges and solutions are the same here as elsewhere in Europe. These types of promotion are increasingly powerful and relevant in today’s retail marketplace as an alternative to, and in conjunction with, Every Day Low Pricing (EDLP), offering a point of difference over and above a value offer.
GT – In today’s multi channel environment the major retailers operate stores in a variety of formats and online. How do you fit into that strategy – do you offer the same promotion across all channels, or do you tailor it?
We run projects in supermarkets, convenience stores, hypermarkets, fuel, wholesale, health and beauty and online with the same mechanic and at the same time. The benefit is to encourage customers to cross-shop formats and ensure the above the line investment is well utilised.
GT – What do the initials ‘TCC’ stand for?
TCC stands for The Continuity Company, our original name – ‘continuity’ meaning bringing consumers back into the business time and time again over a fixed duration, giving them a reason to return and providing clients with a tie breaker in price wars. The term ‘continuity’ isn’t so well understood overseas, so we changed to TCC.
GT – When was TCC founded and who by?
Richard Beattie, a London advertising man, formerly with Wallace international, a US company specialising in retail promotions, established TCC in 1991 in his flat in Maida Vale. Since then it has partnered with many of the world’s leading retailers, successfully delivering concrete and measurable increases in revenue and market share.
GT – Who owns it now?
Richard is our CEO and owns the majority share of the company. Private ownership helps, particularly when you need to make quick commercial decisions.
GT – How many projects have you run to date?
We’ve successfully run over 5,000 programmes around the world. The experience gained allows us to structure programmes that successfully change shopper behaviour, in close consultation with clients. We currently average 25 promotions per year in the UK.
GT – Where are your global headquarters?
We have several large offices around the world – over 100 staff here, 80 in Milan, 90 in Amsterdam and over 100 in Hong Kong, all with group functions – creative here, finance in Amsterdam, forecasting in Milan and sourcing in Hong Kong.
GT – How big is TCC in terms of turnover, numbers of offices and so on?
TCC is a world-leading organisation, operating in over 50 countries worldwide and working with over 250 retailers. We’ve just competed 21 years, and this is our best year ever. We’re very sound financially, with a Dunn & Bradstreet AAA rating. But more importantly, we have a good level of performance and client retention, and if we grow these, further success will follow. We have many long-term clients, including some who go back to the beginning.
GT – In your view what sets the UK apart from the rest of the world in its adoption of retail marketing promotions?
The UK market is similar to Germany, France, Holland and Italy: our programmes have the same appeal everywhere, and the consumers in each place are all sophisticated and demanding. If you have an appealing reward with the right mechanic, it works.
GT – How are you set up to service the UK retailers – do you have national account teams and so on?
We have teams dedicated to each client: trans Europe clients have an international client director.
GT – Which trade sectors are you involved in?
We work in wholesale and cash ‘n’ carry, health and beauty, convenience, fuel and supermarkets. Most of our worldwide business is supermarkets, the biggest and most sophisticated part of the retail sector, with the highest frequency of visit and hence biggest need for activity.
GT – What are the different stages in setting up a promotion?
We take a brief, draw up a proposal and confirm the creative and the promotion. From there we agree the objectives, the timing and the format of the stores involved, and then run the whole project and install and manage the programme whilst measuring its success.
GT – How far ahead do you work?
We can turn a project round in as little as eight weeks.
GT – That timescale sounds superb. Can you source the rewards as quickly as that?
Yes, we can. We have 100m Euros worth of ‘sitting inventory’ of rewards at any time and can commence largescale activity very quickly. We tailor the design and mechanic of every programme individually, but the rewards involved have uniform appeal across the world. When buying rewards in these volumes, the cost savings can be passed onto the consumer.
GT – How long does sourcing new rewards take?
We usually allow four months.
GT – What effect has the recession had on demand for your services in the UK?
The recession has cut out frivolous and irrelevant promotions, generated an increased need for TCC’s services and solutions, and created an environment in which retailers focus on reducing price and running loyalty programmes.
GT – How long have you been working with Tesco?
We’ve been working with Tesco since August 2011. Our first project was in Tesco Extra stores – a cookware promotion first, then promotions on Royal Worcester Glass and Thomas knives. We’ve just started a new project involving Swiss quality luggage, running for 14 weeks and offering at least 70% off RRP. Shoppers collect a coupon for every £20 spend, and collect 10 coupons. It’s part of our programme with Tesco to offer high value savings to its best customers. Luggage and bags are a proven reward that is popular at this time of year. If a programme works and there’s no conflict, we will recommend it to clients in other countries.
GT – Can you talk us through your work for your other clients?
We work for the likes of Makro, Esso and Spar, with exactly the same type of mechanic. We have successfully entered the discount sector with Penny in Germany, delivering significant market share growth and a profitable sales increase, even at low gross margins, good news for other markets around the world.
GT – What’s the smallest number of stores in which you recommend carrying out a campaign?
The number of stores isn’t important, it’s more the cost of achieving the targeted increase in turnover. A pilot programme could run in two hypermarkets, but it’s our main quest to run national promotions.
GT – Your other area is special events. How does that work?
We set up promotional campaigns around news events to attract family shoppers. Special event licences are all about creating retail entertainment and attracting family shoppers, the most valuable kind of consumer, into stores with an attractive event-based licence. With a lot of grocery retailers fighting for share, you need to incentivise mums and dads to spend more per shop. Parents collect the coupons: children influence them but grandparents also collect them and the whole family gets involved. It’s wholesome, great for the brand and encourages more sales. Shopping can be a chore, but if you can make it appealing and fun with strong promotions, you will definitely bring in the shoppers.
GT – What do you classify as special events?
Special events can include a sporting event, like the FIFA World Cup Campaign in Germany, or entertainment licences such as Angry Birds and Smurfs and other film licenses. We also work with UK rugby, cricket and football licence holders.
GT – How do you handle special events?
GT – How far ahead do you work on these campaigns? Can you tell us about any such campaigns?
We tend to work 12-18 months ahead. We’re now looking at summer and autumn 2013. 2012 is definitely the big year for events: next year will see various movie-related events.
GT – We’ve talked about retailer schemes and special events. Do you also work with brands?
Yes, we do. We work with the brand suppliers to devise promotions in which shoppers buy supplier-funded products and collect a free coupon for a given spend. We sometimes involve FMCG brands to subsidise the retailer’s investment by offering bonus points over and above the general spend. This delivers more sales for the FMCG brand, and has been proven by Nielsen and GFG. Nielsen has compared the sales increase derived from collaborating with a TCC programme and all the other promotional programmes available, for example multi-saves, BOGOFs and promotional gondola ends, and proven that to partner with TCC delivers the largest sustainable sales increase in the store.
GT – Have you been running any promotions based around the 2012 Olympics? What’s your view on the sales promotion aspect?
We haven’t been involved: the licence rights were very restricted, which is a shame. That said, this summer is full of other promotional activity, including the Euro’s and major films such as Ice Age 4.
GT – What major promotions do you have coming up over the next few months?
I can’t say just yet, but we have some big news coming up, and we’re happy to talk.
GT – Finally, where do you see TCC going in the UK and Ireland?
We will continue to be a long-term partner to different retailers in different channels, innovating new methods and programmes and entering new retail sectors, where we are confident we will achieve the same results.
Tel: 0208 564 5100