Proliferation of data sources

The provision of performance metrics in the FMCG (Fast Moving Consumer Goods) industry was dominated by market research firms like Nielsen, Kantar, and Circana (previously IRI), alongside internal data, for decades.

Named Account Data sparked a considerable change in the sharing of what was previously considered highly sensitive and confidential data by retailers. Loyalty Analytics then took shopper insights to a whole new level and also enabled highly targeted consumer offers. The proliferation of data has not stopped there with real-time price and promotions, retail media, a host of ecommerce measures and various social media analytics and more.

Market research budgets have never been so stretched or challenged. Driving incremental return-on-information and ensuring any duplication of insight is minimised has become critical for companies of all sizes.

Traditional Data Powerhouses

Nielsen, Kantar, and Circana have long been the backbone of market intelligence in the FMCG sector, providing insights via point-of-sale data and panel data. These insights were crucial for FMCG companies to understand market shares, retailer performance, consumer behaviour and other key metrics necessary for effective marketing and sales strategies and joint business planning and negotiation with retailers.

Named Account Data: involves specific sales data from a particular retailer providing insights into purchasing patterns, sales trends, shares and inventory needs.

Loyalty Analytics: Loyalty programs are a goldmine of consumer data. By analyzing transactions linked to loyalty cardholders, companies gain deep insights into individual consumer buying habits, preferences, and loyalty. Loyalty card pricing is fuelling membership - Tesco boasted 22m Clubcard user households, 82% of shoppers using the loyalty scheme every time they shop.

Loyalty card data enables businesses to engage in highly personalised marketing, improve customer retention, and optimise product offerings based on actual consumer behavior patterns.

Social Media and Online Engagement:

Consumer interactions on social media platforms and online forums offer real-time data on consumer opinions, trends, and preferences. Reviews and ratings can be particularly useful for gauging brand sentiment, identifying emerging trends, and refining marketing campaigns.

Price and Promotions and Retail Media:

Trade promotions remain one of the more effective but costly activities to increase both brand and category sales. Detailed pricing and promotions data is critical in understanding what drives absolute performance for brands and retailers.

Implications for FMCG Companies:

The proliferation of data sources brings advantages and challenges.

The ability to drill down into individual consumer behaviors and preferences allows companies to tailor their products and marketing efforts more precisely than ever before. Real-time data enables companies to be more agile, responding quickly to market changes and consumer feedback.

However, there is a complexity in integrating these datasets to distill incremental insight and advanced analytical capabilities can be required including data science skills and expertise in analytics and machine learning. Budgets can be stretched even further as some datasets are a profitable revenue stream for retailers and can be ‘mandated’ by buyers.

Conclusion

In conclusion, the proliferation of new data sources is transforming the FMCG industry. While these sources offer significant opportunities for deeper consumer insights and enhanced market responsiveness, they also demand new capabilities to drive incremental return-on-information and insight, as well as challenging budgets.

FMCG companies that successfully integrate these diverse data streams will be well-positioned to lead and pull away from the pack in this increasingly data-driven market.

A proliferation of data sources

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