Leveraging Loyalty Card Data to Improve Trade Promotion Effectiveness Megan R. Margraff Chief Analytic Officer – Spire, LLC
Objectives • Show how loyalty card data can be used to drive shopper-based trade insights and more effective trade plans
Agenda • Background – About the Data Source – Putting the Shopper at the Center of Trade Planning • Case Studies – Live blinded examples of analysis, insights, and trade plan implications • Discussion
About the Data Source
The Spire Shopper Panel Benefits Sourced from 30mm Loyalty Largest blended retailer Card Households composite loyalty card data 15 Banners Mix of retail formats and strategies Actual purchase history Reporting at levels most others cannot Essence /Engagement Segmentation™ Total transaction perspective Compare fresh & center-store Detail on day/time of purchase & method of payment Store Level & Uniquely connect behavior & Store Cluster attitudes Access Via surveys to HHs in our panel then link actual behavior Shopper segmentation to Demographically Representative evaluate sales Group shoppers by behavior, purchase history or differences
Spire offers a variety of shopper insight solutions Spire’s Shopper Intelligence Execution Shopper portfolio includes Activation comprehensive analysis of the shopper behavior impact of a variety of levers: Custom Analytics -Trade Shopper Analytics -Shopper Marketing and Consulting Services -Consumer Promotion -CRM, etc. Shopper Intelligence Portfolio Behavior-Based Segmentation Loyalty Card Data Access Aggregate Shopper Intelligence Platform Retailer Banner Level Shopper Intelligence Platform
Putting the Shopper at the Center of Trade Planning
Traditional trade promotion analysis leverages two to three data sources F&D FO F&D Causal Data 2/$3 $1.79 10/$10 500 400 Volumetric Units 300 200 Data 100 0 Baseline Sales Incremental Sales Financial Cost: $100K Cost: $75K Cost: $250K ROI: $0.75 ROI: $1.05 ROI: $0.88 Data
…but traditional trade promotion analysis leaves critical shopper-based questions unanswered F&D FO F&D Causal Data 2/$3 $1.79 10/$10 500 400 Volumetric Units 300 200 Data 100 0 Baseline Sales Incremental Sales Who is buying on deal? % Buyers % Buyers % Buyers Heavy Heavy Heavy Medium Medium Medium Light Light Light New New New
Traditional analysis leaves many shopper based questions unanswered… F&D FO F&D 2/$3 $1.79 10/$10 500 400 Volumetric Units 300 200 & Causal 100 0 Data Baseline Sales Incremental Sales Average Purchase Size on Deal How do 1.5 units 1 unit 6 units promotions affect purchase behavior during the deal?
Traditional analysis leaves many shopper based questions unanswered… F&D FO F&D 2/$3 $1.79 10/$10 500 400 Volumetric Units 300 200 & Causal 100 0 Data Baseline Sales Incremental Sales Baseline Baseline Baseline goes up stays flat goes down How do after deal… after deal… after deal… promotions Did we drive Did we Did we affect purchase repeat subsidize pantry load among new buyers who and extend behavior after buyers? would have purchase the deal? bought cycles? anyway?
Putting the shopper at the center of trade planning The Need… • Develop trade plans with a deep understanding of the shopper behavior does each type of event drives in the short and long term – Which trade tactics subsidize base volume by driving short term lift but not long term growth? – Which trade tactics drive long term benefits (ex: T&R, expandable consumption, loyalty)? – Which trade tactics drive detrimental long term shopper behavior such as deal to deal buying? – What is the impact of product interaction within the category in driving positive and negative shopper behaviors? – Do different shopper segments respond to tactics in different ways? The Benefits Deliver a trade plan that maximizes positive shopper behaviors & limits negative behaviors Support each recommendation with simplified shopper-based rationale : Trade Plan Do’ s & Don ’ ts Maximise the impact of Trade plans at the: Brand level, Portfolio level & Category level Category and shopper insights simplify retailer buy-in/execution
Case Study
Trade Intelligence Case Study For major center of store food manufacturer with over 1200 Trade Events Client Need – Overall impact of current trade strategy on both short and long term volume – Impact to shopper behavior of current trade promotions tactics – Reduce overall trade budget with no impact to overall sales and shopper loyalty The Solution – Analyzed thousands of trade events at category & PPG level across 12 retailers – Built database of individual trade events – Identify impact of each trade tactic (i.e. multiples pricing) both short & long term – Deliver simplified Field Sales Action plan with prioritized recommendations
Recommended approach leverages a variety of data sources for a “from the ground up” view of trade events Detailed Tactics Many Events Promoted Price, Multiple, Discount Thousands of Trade events FSI/Shopper Marketing Multiple Client and Competitive Promotable Product Groups Timing & Frequency Hundreds of Unique Tactical Other Promoted PPGs/Brands Combinations Season & Holiday 12 Retail Banners 2 Years Varied Data Sources Actual, Card-Based Purchase Behavior & Pricing Detail Syndicated Merchandising Calendars MarketVision AdViews Trade Planners
Recommended three phase approach begins with a comprehensive database of trade events and tactics Phase 1 Trade Tactics PPG Line vs. Segment Promotion Feature/Display Support Promoted Price & Multiple Duration Timing (Season, Week of Month) Frequency / Gaps Promotion with other PPGs Promotion with Key Competitors Shopper Marketing Support FSI Overlay
Second phase is to analyze the purchase behavior impact of each trade event, comparing deal buyers to non-deal buyers Phase 1 Phase 2 Trade Tactics Behavior Impact PPG Who buys? Line vs. Segment Promotion How much do they buy? Feature/Display Support What else do they buy? Promoted Price & Multiple Impact to purchase cycles? Duration Impact to trial? The behavior impact of each Timing (Season, Week of Month) Impact to switching? event is analyzed using a test vs. control approach, Frequency / Gaps Is there a post-deal trough? comparing: Promotion with other PPGs Loyalty effect? • Deal buyers vs. • Non-deal buyers shopping Promotion with Key Competitors Repeat buying effect? weeks pre/post deal in same banner, same products Shopper Marketing Support Category impact? FSI Overlay Deal-to-deal buying?
The third phase is to apply rigorous analytic techniques to link the tactics used to the changes in behavior they drive for each promoted product group Phase 1 Phase 3 Phase 2 Trade Tactics How Tactics Drive Behaviors Behavior Impact PPG Who buys? Line vs. Segment Promotion How much do they buy? Feature/Display Support What else do they buy? Promoted Price & Multiple Impact to purchase cycles? Duration Impact to trial? Timing (Season, Week of Month) Impact to switching? Frequency / Gaps Is there a post-deal trough? Promotion with other PPGs Loyalty effect? Promotion with Key Competitors Repeat buying effect? Shopper Marketing Support Category impact? FSI Overlay Deal-to-deal buying?
This approach provides a consistent framework to address a wide range of business questions Sample Business Questions • What is the impact of promoting multiple brands within the portfolio together? Which combinations drive trade-down vs. up-sell/variety-seeking? • What’s the right sequence of promotions across my brand portfolio? • Does holiday promotion drive loyalty/share of requirements throughout the year? • What are the right tactics for holiday vs. non-holiday deals? • How do I optimally plan trade deals and shopper marketing activities for synergy? • How do trade deals compare to shopper marketing events in terms of long term benefits? • Which tactics used by my competitors are harming the category? Which tactics should I consider emulating with my brands? Sample Insights One-week deals drive incrementality, while two-week deals already begin to subsidize loyal buyers Promote Brand A with Competitor C, but never Brand B with Competitor C In terms of discount, go for 40% or more… or aim for efficiency. Moderate discounts are a waste of resources, as response doesn’t justify additional spend Using the right multiple drives strong expandable consumption for the brand and the category, but using SUP/too-low multiples drives subsidization Brand B isn’t getting repeat from holiday triers … but Competitor C is, thanks to stronger post - holiday planning
Recommend
More recommend
