December 23, 2008

Recent Advance in Use of Reseller Information

Consumer goods (CG) marketers have used Management Science Associates (MSA) to develop and maintain databases integrating their marketing and sales information for more than 40 years. MSA solutions help CG companies uncover new-growth opportunities by combining, among other things, census-store-level shipment data with powerful analytics and reporting tools. This year, the tactical potential of these data sets got a boost after Kenosia suggested combining MSA's databases and insights with DataAlchemy capabilities for the benefit of their mutual clients in the CG community.

Kenosia saw opportunities for greater coordination with mutual clients -- for example, Nestle Waters North America and Procter & Gamble (P&G) -- providing the potential for increased agility in driving retail performance. For the P&G initiative, the partners are focused on opportunities in both North America and China. At the recent NACS Expo, MSA, Data Alchemy and P&G showcased powerful new reports for the convenience store industry leveraging MSA-managed P&G databases and DataAlchemy reporting.

Data@Factory & Reseller Information System (RIS)

MSA's store-level data management evolved from a 1970s system that managed for CG manufacturers records of all individual shipments to wholesalers and retailers. Out of such large-scale and granular data warehousing came timely, accurate data at a level of geographic detail not previously available. CG manufacturers used the information to determine sales territories and develop programs to grow market share. The system's accuracy and comprehensiveness was such that the U.S. cigarette industry and 46 States Attorneys General jointly chose it to implement their 1998 Masters Settlement Agreement, which was created to identify the manufacturers from which to collect $246 billion and the percentages to be dispersed to the 46 individual States over a 25-year period.

Now known as the Data@Factory at MSA, the system tracks all shipments from client manufacturers' plants directly to retailers as well as indirectly to retailers through wholesalers or other types of distributors. As both data size and level of detail increased, a wide range of powerful applications has emerged, including calculating sales performance payments to retailers and distributors. By the late 1990s, the Data@Factory was managing the performance data behind more than $1 billion in trade payments annually. This MSA technology, coupled with new features such as price gap analyses, technology for sales forecasting, new product launches, sales force allocations/assignments, ongoing evaluation of sales performance and trade program check cutting service, is now being provided to many CG leaders and DataAlchemy clients.

By capturing manufacturer and distributor shipment data, the Data@Factory achieves census-level information for the full range of trade channels. On a weekly basis, data from approximately 5,000 distribution centers supplying more than one million retail sites is processed. These retail sites and the more than 400,000 brands they carry are cleaned, coded and warehoused, giving client access to new performance measurements in many channels, including previously unmeasured ones like convenience, liquor, bars, restaurants, vending, and book stores, where syndicated data sources fall short.

In each of these channels, CG manufacturers use store-level performance insights to develop – and measure the effectiveness of -- tactical and strategic sales and marketing. The data drives profitable growth by helping CG organizations optimize sales force and broker coverage, fill distribution voids, perform clustered-store plan-o-gramming and optimize account-specific SKU assortments.

Transforming so much data into a single "truth" that is both accessible and manageable for the full range of CG personnel interested in store-level data requires structured but flexible reporting. DataAlchemy is an excellent platform for the focused analysis and presentation of such large and complex data sets.

Kenosia's and MSA's understanding of end users' various analytical needs and skill levels is used to deliver insights while preventing data-usage errors. The end-user is guided through the presentation of results with text verbiage highlighting key findings. Analyses presented through DataAlchemy include:

• New Product Introduction: Provides an early tracking for new items being introduced to a market or class of trade. Users can measure the success of the launch by tracking the number of new stores carrying the product and the number of stores re-ordering.
• Class of Trade Share Gap Analysis: Compares the performance of a brand in different class of trades.
• Account Reviews: Supports the sales team with an up-to-date presentation of key performances measurements for their sales partners. The process is automated, reducing the time the Sales teams spend to compile the data for each account.
• Regional Growth Analysis: Measures the performance of brands across sales regions. Intelligent verbiage on the report alerts the user to significant trend changes.

New Reporting Features based on RIS & Data Alchemy Capabilities

Recent innovations stemming from the integration of Kenosia Data Alchemy capabilities for CG manufacturers facilitate more timely use of all types of data.
DataAlchemy's new mapping capability is being used by MSA clients to identify opportunity to expand product placements with non-selling stores, based upon a "Share in Stores Selling" measure and regional share information. The inclusion of drop-down selection boxes in DataAlchemy allows delivery of reports similar to MSA's existing product suite. MSA's insights to price gap analysis are providing DataAlchemy users with insights about market drivers of chain volume sales. These new developments were displayed at a DataAlchemy User Conference and the price gap insights were used at the NACS Expo.