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The Pepsi Bottling Group's mission statement says it all: "We Sell Soda." The need to plow through big binders full of demand forecasts, promotions, and per-store authorized product lists was restricting PBG's sales reps' ability to use the limited time they have at each store to close sales. A new "Smart Selling" application delivered on lightweight handheld Pocket PC's gives each rep all the tools and information needed to sell effectively. The application was developed in only six months by partner Shelflink in close cooperation with PBG, using Visual C# .NET, Visual Basic .NET, and the Microsoft .NET Compact Framework. PBG's goal for this application is to drive customer revenue while reducing costs at every stage of the supply chain.

Situation

"When our sales reps go into a store today, they have only a few minutes of the store manager's time in order to make a sale," says Paul Hamilton, VP of supply chain at The Pepsi Bottling Group (PBG). "Every day we send 6,000 salespeople out to make a difference both for our business and for the businesses of our retail customers. If we don't provide them with the best tools to have at their disposal, we are not going to be able to take advantage of the 20 million interactions that we have every year."

PBG is the world's largest manufacturer, seller, and distributor of Pepsi-Cola beverages - some of the world's most recognized consumer brands. It sells about 1.5 billion cases of soda a year to about 650,000 customers in the United States and about a million customers worldwide.

PBG's salesforce has to contend with a proliferation of SKUs, a complex pricing scheme, customer development agreements, periodic promotions, and lists of authorized products that can vary from store to store, even within a chain.

"We have a number of customer development agreements," said Kevin Neville, senior manager of IT. "These annual agreements cover marketing activity, shelf space, and equipment placements. We want to measure compliance with those agreements and close the gap where there are voids.

"Another major issue is that the number of SKUs we're supporting is just proliferating, each with its own price point and various promotions built around them. That's a great deal of information for our front-line selling performers to manage. Our sales reps needed an efficient system to quickly track information on individual SKUs and promotions in order to maximize their selling capability."

Solution

PBG has rolled out Symbol PDT 8000 Pocket PCs to its salesforce and built a next-generation application for the sales reps with the help of Shelflink. The Pocket PCs tie into the back office using 802.11b wireless connectivity when available or through a dial-up line. Shelflink built the Pocket PC application using the Microsoft Visual C#® and Microsoft Visual Basic® .NET languages, and the Microsoft .NET Compact Framework.

The Pocket PC application combines communication, route management, real-time demand forecasting, sales optimization, and personal performance optimization. The application tries to capture every sales growth opportunity by giving the rep priorities, targeting the most relevant sales opportunities by customer, ensuring compliance with customer development agreements, closing product distribution opportunities, and creating incremental demand on every sales call.

In addition, it tries to match order quantity to demand by modeling replenishment demand with historical data. The application does regressions of shipment, price, display, advertising, seasonality, and other factors. It then uses probability simulation to estimate demand.

The application leverages the customer rep's presence in the store to enhance the initial forecast and factor in incremental growth. This in-store feedback allows the application to take into account the true demand factor conditions — the retail price, the kind of display used, and so on — and also to allow for inventory on hand and delivery schedules.

"The sales application is really designed to help selling in two different ways," said Ray Brown, PBG's director of supply chain technology. First, it provides sales reps with information about a customer and identifies opportunities that they can sell against in the account. The second is to provide sales reps with their monthly priorities. Combined, these two elements provide our sales reps with the overall guidance and account-specific information needed to drive revenue at every opportunity. Since PBG has so many sales reps, it was critical to make the application easy to learn and use.

"The Pepsi Bottling Group has 6,000 sales reps and most do not stay in the same position for very long," said Nate Quigley, president of Shelflink. "So we needed a consistent application that didn't require a lot of time to ramp up to productivity. The application had to be very intuitive, so a new user could pick up the device, hit the street, and be productive. The interface itself draws them into the application, shows them where to go, what to look at, and what to do next."

Benefits

Rapid Application Development

"The .NET Compact Framework allows us to rapidly go through a process of iteration with The Pepsi Bottling Group," said Quigley. "So our role in the development process is not the traditional role of laying out functional specifications.

"One of the big value propositions that we brought to the table with Pepsi is our ability to turn the application around quickly and to do multiple iterations in a very compressed time frame. Our product development process itself follows all the principles of Rapid Application Design. So we would show up, do an iteration, take comments and feedback, integrate those into another build, and be back later in the week to get feedback again. The .NET Compact Framework allowed us to turn the application around so quickly, so many times.

Connect to Servers With XML Web Services

"Pepsi already has a wealth of information on their front office and back office servers. The ability to draw that information into the application and quickly integrate it into the functionality that we brought to the table has been very important. Specifically, reporting information goes into a scorecard that allows the sales rep to understand how he's doing today, this week, this month, and this year. We're able to draw on Pepsi's data warehouse and, through XML Web services, to quickly publish that information to the handheld device and integrate it within the framework of the application.

"We think it's critical to help the sales rep understand the answers to four key questions: What do I have to do; how am I doing; what's in it for me; and what can I do to get better? Our ability to use XML Web services to integrate some of the answers to these questions, within the framework of the application itself, has been very productive, very powerful. XML Web services within the .NET Compact Framework has allowed us to extract data from key systems and easily extend them to the mobile environment.

Component-Based, Cross-Language Development

"The beautiful thing about the Compact Framework is that it's a true component-based development framework. Rather than embedded code that quickly piles up and is hard to sort through, we could launch multiple developers in parallel, in real time, working on individual components that could later be integrated together and launched."

"We actually used the combination of Visual Basic .NET and Visual C# on the mobile client," said Andrew Park, senior software architect at Shelflink. "In large part, that was determined by the familiarity of the developers with the languages. The control libraries were written in Visual Basic .NET, while some of the underlying code was written in C#. We were able to switch the team members around from back end to mobile client because it's all the same object model. more

"The language interoperability was huge because some people were adamant about using Visual Basic and other people were more into learning C#. I did most of my development in C# whereas some of the other people did it in Visual Basic. There really wasn't any contention and the interfaces were able actually to inherit classes from Visual Basic and C# seamlessly, without a problem."

Extends Servers to Devices

"Our developers were able to leverage some of the work that they've done already on the .NET Framework for some server-based components we built in another engagement," said Quigley. "In addition to the skills, which transferred very quickly from the server-based world to the mobile world, we were actually able to use some pieces of our code directly in the mobile environment.

A Natural Transition

"We evaluated multiple platforms. We chose the Microsoft .NET Compact Framework because our developer team and skillset within the company already had a lot of skills in the Microsoft toolkit. Moving to C# and Visual Basic .NET in the Compact Framework was a natural transition for us.

Better Performance, Strategic Value

"We also considered J2ME but we looked closely at the performance and thought that the .NET Compact Framework would outperform J2ME. And also our customers respond very well to the fact that we are using the Microsoft toolkit because they can understand the ability to bring some of that code in house following our engagement, and continue to expand and maintain the application themselves.

"The .NET Compact Framework is an important part of our strategy as a company. We want to go out and serve the smartest, most aggressive, market leading early adopters in a couple of different verticals. And to do that, we know we have to push well beyond what today's legacy applications do and develop the next generation of applications."

Projected Revenue Impact

The impact of this application will come from several specific areas:

• Intelligent selling prompts on "highly relevant" offers will lead to increased up-selling and cross-selling.
• Increased sales through reduced out-of-stocks as a result of better demand forecasting. This is a major industrywide issue valued at $7 billion by the Grocery Management Association in a study that showed that industry out-of-stocks average 7 percent.
• Demand forecasting also improves the sales reps' productivity by reducing the time reps spend jotting notes, calculating, and thinking about order quantities.
• Better authorized product management will reduce costs by reducing invoice disputes. We have a filter in the application that prevents the rep from selling an account a product that they're not authorized to buy.
• Closer management of trade promotion performance agreements will drive increased compliance and lead to increased consumer demand. Items such as displays, reduced retail pricing, and other "Retail Execution" performance elements are negotiated at headquarters but must be executed by reps in the field. Our application reminds them of the current agreements for each account.
• Faster and more effective introduction and selling of new products will drive sales by putting innovation on shelves in closer coordination with marketing efforts.
• Integrated bar code scanning will reduce the time reps spend on low-value work, such as inventory management, and increase their time for higher value selling activities.
• Integrated rich media selling aids will drive increases in close rates on offers by increasing consistent delivery of the marketing message at targeted and relevant opportunities.

  * Digital delivery of these selling aids will reduce printing and distribution costs, while at the same time ensuring that selling aids are available when needed at the precise moment of truth - and not lost or left in the truck.

A Competitive Advantage

"At the Pepsi Bottling Group, it is very important for us to be able to convert an order into a delivery in less than 24 hours and to do it absolutely flawlessly," said Hamilton. "All of the new applications that we've developed, including this one, must be able to integrate with our systems, allowing us to convert an order into a delivery the very next day."

"Our current application today replaces our paper-based system of the past. Our new application is much more sophisticated. We're going to be providing our retail partners with critical pieces of information to improve their business. We feel quite confident that the tools we're developing will deliver accurate, timely information on a consistent basis - day in and day out, order by order.

"Our need to be connected on a real time basis is growing by the day. In today's world, we're connected at the beginning and end of every day. The application and tools allow us to take advantage of that connectedness and, consequently, opportunities present themselves.

"We believe that our use of this application will help us to significantly enhance our competitive position, while at the same time delivering tangible benefits to our retail partners. There is nothing like it in today's marketplace.

Agility

"As we were developing the application we were pleasantly surprised many times. What we thought would take a lot of time was completed much sooner, allowing us to quickly add capability to the application that otherwise would have been put into revision two, three, or four.

"At the Pepsi Bottling Group, agility is critical. With our vendors and [Microsoft] Visual Studio® .NET, we have been able to bring folks up to speed much more rapidly than we expected, integrating them into our IT organization in a productive, efficient fashion.

"Our sales representatives today have to address a number of issues when visiting each of our customers. Their ability to provide the right information to that retail customer at the precise moment it's required is of utmost value to us. Specifically, we wanted them to be able to deliver selling materials to help drive the category and information to help eliminate out-of-stock product inside the store. This application has allowed us to do both, and both of those better than we'd ever expected to do."

The Microsoft® .NET Compact Framework, a subset of the .NET Framework, extends the benefits of developer productivity and XML Web services integration to resource-constrained devices, such as Pocket PC and other Windows® CE-based systems. It provides a highly productive environment for development and integration with virtually any data source, ranging from local SQL Server CE databases to enterprise back ends. The Compact Framework's unified, hierarchical class library enables software developers to rapidly construct rich user interfaces, access native operating system methods, and interoperate with assets on the device, such as the infrared data port and other hardware extensions.

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For more information about The Pepsi Bottling Group's products and services, call (914) 767-6000 or visit the Web site.

For more information about Shelflink's products and services, call (617) 715-3000 or visit the Web site.

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