TPM Trade promotion management : Technical aspect .

Standard role : SAP_CRM_UIU_TPM_PROFESSIONAL 
Components  : TPMOE 

1.     TPM Summary

o    Trade Promotion Management is the process of planning, budgeting, presenting and executing incentive programs that are established between a manufacturer and a retailer to enhance the sales of specific products.

§  Planning: In order to meet account objectives, it is imperative to have a solid promotion plan. This plan should be based on past history, customer history, brand/product history, corporate objectives, and good judgment. Currently, many companies have extremely informal or non-existent processes.

§  Executing: A primary stumbling block in the execution of the account plan is accurate and timely payment to retailers for promotion performance. Effective processes and tools are imperative to avoid costly deduction expenses and overspending due to poor accounting.

§  Analyzing: Studies show that between 50-90% of promotions are not profitable. Many companies are not performing any post promotion analysis to determine which promotions are profitable. Without this analysis, the same unprofitable promotions are run over and over again.

The Goal: Significant increases in effectiveness coupled with reductions in trade promotion spending. 

1.     Types of Trade Promotions

o    Trade Promotion Management (TPM) is the configuration and management of three types of promotions.

o    Corporate Promotions

§  Company-wide promotions of a product or a brand in which accounts can participate.

§  They are run for a specific time period and contain the objective of the promotion, suggested tactics, and other information.

§  For example, a beverage company decides to promote a new product with the recommended tactics of a temporary price reduction (TPR) and in-store displays.

o    Discretionary Promotions

§  After a discretionary promotion has been created, it is saved as a template.

§  The promotion templates that can serve as the basis of an account promotion .

§  Other key account managers can use templates of existing promotions when establishing promotions at their accounts.

o    Account Promotions

§  Based on a corporate promotion or a discretionary promotion.

§  A plan is a group of account promotions that depicts the aggregate results of account promotions, such as spending and volume. 

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Making Settings in SAP SCM for Integration with SAP CRM

Use
You must make the following settings in SAP SCM before you can proceed with Demand Planning.
Caution: In principle, you can configure these settings to suit your requirements. However, you must ensure that the settings in SAP SCM reflect the settings in SAP CRM, else the planning data in SAP CRM cannot be transferred to SAP SCM. Pay particular attention that the attributes for business partners and business partner groups in the BI system used for SAP CRM have the same name as in the BI system used for SAP SCM.


Activities

1. Create a time buckets profile.

In the SAP Easy Access menu, choose Advanced Planning and Optimization -> Demand Planning -> Environment -> Current Settings -> Maintain Time Buckets Profile for Demand Plng and Supply Network Plng.

2. Maintain the storage buckets profile.

In the SAP Easy Access menu, choose Advanced Planning and Optimization -> Demand Planning -> Environment -> Current Settings -> Periodicities for Planning Area.

3. Create and configure a master planning object structure.

Include the required attributes in a master planning object structure and create a characteristics combination for all possible combinations of product, business partner, business partner group, and SAP APO location. In the SAP Easy Access menu, choose Advanced Planning and Optimization -> Demand Planning -> Environment -> Administration of Demand Planning and Supply Network Planning.

For more information, see SAP Library under SAP Supply Chain Management (SAP SCM) -> SAP Advanced Planning and Optimization (SAP APO) -> Demand Planning -> Demand Planning Process -> Planning Area Administration -> Planning Object Structures -> Master Planning Object Structure.

a) Create a planning area.

For more information, see SAP Library under SAP Supply Chain Management (SAP SCM) -> SAP Advanced Planning and Optimization (SAP APO) -> Demand Planning -> Demand Planning Process -> Planning Area Administration -> Planning Area.

b) Activate the master planning object structure.

To do this, choose Activate in the context menu for the master planning object structure.

In the planning object structure, set the indicator Relevant for DP-BOM to True if you intend to use display pallets. BOM is used to model display pallets.

c) Create time series objects for the planning area.

To do this, choose Create Time Series Object in the context menu for the planning area.

d) Create characteristics combinations for the planning object structure.

To do this, choose Char. Combinations -> Create in the context menu for the planning object structure.

4. Define a planning book

For more information, see SAP Library under SAP Supply Chain Management (SAP SCM) -> SAP Advanced Planning and Optimization (SAP APO) -> Demand Planning -> Demand Planning Process -> Planning Book Design.

5. Maintain the promotion key figures.

In the SAP Easy Access menu, choose Advanced Planning and Optimization -> Demand Planning -> Planning -> Promotion -> Settings -> Maintain Promotion Key Figures .

6. Create a forecast profile.

For more information, see SAP Library under SAP Supply Chain Management (SAP SCM) -> SAP Advanced Planning and Optimization (SAP APO) -> Demand Planning -> Demand Planning Process -> Creation of the Demand Forecast -> Interactive Demand Planning.

7. Assign the planning book to the user.

In the SAP Easy Access menu, choose Advanced Planning and Optimization -> Demand Planning -> Environment -> Current Settings -> Assign User to Planning Book .

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Define Settings for Funds Integration

Use
In this IMG activity, you can make settings to integrate funds management functionality into your trade promotions. You can set the fund association level, select a fund determination profile, map the expense type to the accrual profile, make setting for availability check, determine in which states the budget for promotions is reserved, and map the expense type to the trade spend.
Requirements
You have completed the IMG activities for Funds Management.

Activities

1. Under TFM Integration View, choose the promotion type with which you would like to integrate funds.

2. Under Fund Association, choose the level at which to associate the fund to the trade promotion.

3. Select a fund determination profile.

The fund determination profile determines the funds that are available for association with the trade promotion.

4. Select a date range.

The available selections here correspond to date ranges set up for the trade promotion. The selection made here becomes a required entry when creating a trade promotion. For example, if you select Plan here, then an entry for the plan date range is required when creating a trade promotion.

When associating a funds plan to the trade promotion, users can only select funds plans available during the date range you select here. The trade promotion dates should be contained within the fund plan fiscal period.

5. Under Expense Type to Accrual Profile, select the expense type for a particular promotion type.

If Accrual Profile is left blank, then there will be no accrual for this expense type and its related trade spend. It is recommended to leave this field blank for off-invoice type trade spends, as they only create pricing records and not rebate agreements. Therefore, accruals are not relevant.

6. Select the accrual date range and accrual profile to map to the expense type.

The accrual profile is used when generating fund usages.

Note: Although you calculate and post accruals in SAP CRM, you must maintain an account key and an accruals / provisions key for all of the condition types that are part of your SAP ERP pricing procedure. Since the accrual rate in the condition records that are transferred to ERP is zero, the SAP ERP accrual calculation results will also be zero. To set the rebate agreement status to settled, you also need to carry out a zero final settlement in SAP ERP.

7. Under System Status to AVC Profile and User Status to AVC Profile, make any appropriate settings for the availability check (AVC).

The system status to AVC profile determines the fund usage value category for a particular system status. This is the criteria used to determine under what category (reserved or pre-reserved) the fund usages are generated as the status of the promotion changes.

You can select a fund usage value category. Note that you can only make one entry for each of the fund usage value categories Pre-Reserved and Reserved for both the system status and the user status. You could, for example, have a system status with the fund usage value category Pre-Reserved and a user status with the fund usage value category Reserved, but not both a system and user status with the fund usage value category Reserved.

You can also set a priority for each status. If there is a conflict between two statuses, the status with the lowest number assigned as the priority is used for the trade promotion. To avoid inconsistencies, ensure that you have assigned a different priority for each system and user status. If, for example, you have maintained four system statuses and four user statuses, you could assign the numbers 1 to 8 as the priorities.

8. Under Trade Spend to Expense Type, choose the expense type to be mapped to the trade spend.

The combination of the spend type, spend category, and spend method determine the trade spend. The trade spend and expense type are mapped in a one-to-one relationship in order to properly generate fund usages for the trade promotion.

9. Under Expense Type to Key Figure, select a key figure to map to the expense type.

This ensures that the planning costs entered in the planning grid are leveraged in fund usages to reserve budget.

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 There are some settings required for claims management integration as well . 

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Data from SAP documentation 

Trade Promotion Management 

Technical Data

Technical Name of Business Function	CRM_TPM_1
Type of Business Function	Enterprise Business Function
Available As Of	SAP Enhancement Package 1 for SAP CRM 7.0
Technical Usage	CRM Core
Application Component	Trade Promotion Management (CRM-MKT-MPL-TPM)
Directly Dependent Business Function Requiring Activation in Addition	Not relevant

You can use this business function to acquire increased business functions in the area of trade promotion management.

Prerequisites

You have installed the following components as of the version mentioned:

Type of Component	Component	Is Needed Only for the Following Features
Software Component	BBPCRM701	Not relevant
Technical component or business content, e.g. Portal Content	BI Content 7.05	Not relevant

Features

Trade Promotion Agreements

Trade promotion agreements have been enhanced to allow you to do the following:

• Create trade promotions from within a trade promotion agreement
• View analyses from SAP NetWeaver Business Warehouse (SAP NetWeaver BW)

For more information, see Trade Promotion Agreements.

Mass Approval

The mass approval process has been enhanced to allow you to do the following:

• Mass approve trade promotions in the background
• Mass approve trade promotions using parallel processing
• View summary of changes made to trade promotions
• Customize statuses to be set for mass approval
• View the total key figure amounts to be mass approved
• Search by promotion guideline and indirect indicator status
• Download mass approval results list to a spreadsheet application

For more information, see Trade Promotion Approval and Re-Approval.

Parallel Processing

You can now use parallel processing when you mass approve, mass change, or mass copy trade promotions. The system previously processed these trade promotions sequentially, while the system now processes all these trade promotions simultaneously.

For more information, see Trade Promotion Approval and Re-Approval and Trade Promotion Management.

Spend Value Overview

The spend value overview is now available as a single place to enter spend values for multiple products and trade spends within a simple trade promotion.

For more information, see Spend Value Overview.

Sales Areas for Off-Invoice Trade Spend Checks

You can now specify, by sales area, if you allow the following to be added to trade promotions:

• A check on off-invoice trade spends with dates in the past
• Products with effective dates in the past when off-invoice trade spends with dates in the past exist

For more information, see Trade Spends and Dates.

Fund Usages

Fund usages have been enhanced to allow you to do the following:

• Balance fund usages for a trade promotion from several places within a trade promotion
• Use trade spend dates from trade promotion planning as the accrual date range for fund usages

For more information, see Fund Usages and Funds Integration.

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Trade Promotion Management 

You use trade promotion management (TPM) to do the following:

• Perform planning and budgeting of your trade promotions from the top down at the headquarter level or from the bottom up at the account level
• Execute your trade promotions
• Manage funds management and claims management processes relating to trade promotions
• Monitor the success of past and current trade promotions

Integration

You can integrate functions from the following applications with TPM:

• Funds management
  You can link funds to trade promotions and assign a budget during promotion planning. During the trade promotion evaluation and analysis process, funds are planned, committed, and accrued with the purpose of budget tracking. For more information, see Funds Integration for Trade Promotion Management.
• Claims management
  You can validate and settle claims, in addition to using them to create invoice claims, deduction claims and direct payments. For more information, seeClaims in the TPM Business Scenario.
• SAP NetWeaver Business Warehouse (SAP NetWeaver BW)
  You can use SAP NetWeaver BW to provide a complete overview of past and current promotional performance, which simplifies the planning process and allows quick reaction to changes in the market.
• SAP ERP
  You can use SAP ERP to finalize claims and to close promotional accounts upon final settlement. SAP ERP tracks all receipts relevant for rebate processing (generated from trade promotions) and automatically posts accruals. For more information, see Rebates in Trade Promotions.
• SAP Advanced Planning and Optimization (SAP APO)
  You can use demand planning with TPM to ensure adequate supply during promotional periods. For more information, see Purchasing Process in Marketing Projects.

Prerequisites

• You have completed all of the activities in Customizing for Customer Relationship Management under Trade Promotion Management.
• If you plan to use the mass copy function, you have configured the formatting mask that all copied trade promotions must use in Customizing forCustomer Relationship Management under  Marketing  Marketing Planning and Campaign Management  System Landscape  Define Formatting Mask for Marketing Projects. 

Features

The following features are available to help you manage your trade promotions.

Features for Planning Trade Promotions

• Deals
  You can generate trade promotions from deals for a predefined set of accounts for specific products. For more information, see Using Deals to Create Trade Promotions.
• Trade promotion agreements
  You can use agreements to provide guidelines for trade promotions and you can link trade promotions to agreements created for specific accounts to identify contractual obligations. For more information, see Trade Promotion Agreements.
• Volumes and trade spends planning
  Volumes and trade spends planning allows you to carry out forecasting for deals, trade promotions, or trade promotion elements. For more information, see Volumes/Trade Spends Planning.
• Trade promotion guidelines
  You can use this function to ensure that your trade promotions fall within guidelines based on established rules and thresholds. For more information, see Trade Promotion Guidelines.

Features for Creating Trade Promotions

• Trade promotion templates
  You can create trade promotion templates as a basis for creating multiple trade promotions that have similar attributes. For more information, see Trade Promotion Templates.
• Product assignment
  You can assign products, product groups, product categories and product segments to a trade promotion. For more information, see Product Assignments.
• Partner assignment
  You can assign partners with functions to a trade promotion. Partner determination can be used to control which partners can be assigned to a trade promotion. For more information, see Partner Assignment.
• Conditions and rebates
  You can use conditions and rebates to offer your accounts special discounts for a certain order item. For more information, see Conditions and Rebates in Trade Promotions.
• Mass copy and mass change
  You can use these functions to quickly create and modify multiple trade promotions. You can use parallel processing so that during a mass copy or mass change the system processes all trade promotions simultaneously, rather than processing each trade promotion sequentially. For more information about parallel processing, see Trade Promotion Approval and Re-Approval.
• Causal factors
  You can identify incentives that will affect trade promotion performance. For more information, see Causal Factors for TPM.
• Overlaps
  You can perform an overlap check to identify potential overlaps to avoid similar or identical trade promotions being released simultaneously. For more information, see Trade Promotion Overlaps.

To use parallel processing for mass copy and mass change, you must activate the business function Trade Promotion Management (CRM_TPM_1).

Features for Monitoring Trade Promotions

• Mass approval
  You can use this function to approve many trade promotions at once.
• Versions
  You can view all changes that have been made to a trade promotion since it was created.
• Critical changes
  You can set up alerts to notify you when a trade promotion needs to be reapproved following changes identified as critical.

For more information on these features, see Trade Promotion Approval and Re-Approval.

More Information

Trade Promotions

Marketing Projects Management

Key Figure Planning

Funds Management

Claims Management