the new realities of e-commerce and the keys to online growth … · 2019-01-07 · mulo ecommerce...

© 2018 Information Resources Inc. (IRI). Confidential and Proprietary. 1

The New Realities of E-Commerce and The Keys to Online Growth in CPG


• Consumers are disrupting the marketplace

• E-Commerce is the fastest-growing channel in CPG

• E-Commerce size has been limited due to lack of retailer

delivery infrastructure

• To succeed in the digital world, Brands must re-wire their

go-to-market strategies

WHAT ARE THE NEW REALITIES OF E-COMMERCE?


Total CPG Omni-Channel

Sales Are in The

E-Commerce Channel

Source: IRI eMarket Insights and Market Advantage, 2018 Building Calendar

Year w/e 8/12/18

+10%

YTD 2018



Growth is driven by

E-Commerce Channel

+56%

YTD 2018

Sales are the sum of 150 tracked categories


Year w/e 8/12/18


Total E-Commerce

Growth is driven by

Amazon

YTD 2018

+49%



Year w/e 8/12/18



Growth is driven by

Amazon

27%

YTD 2018



Year w/e 8/12/18


3%Total CPG Omni-

Channel Sales

+100MMAmazon Prime

Members

+193MMUnique Shoppers

Per Month

+57%Total Amazon

Growth Vs. YAGO

Up To 7X Greater Share vs.

Next “e”Tailer


Source: IRI eMarket Insights and Market Advantage, 2018 Building Calendar Year w/e 8/12/18


More CPG Shopping Still Happens In-store

97.9

83.8

68.1 65.5 63.353.7

44.4

24.3

8.7

Grocery Walmart Drug Dollar Mass andSupercenter

Club Internet Amazon.com Whole Foods

% US HHs Shopping for CPG Products

Source: IRI CSIA™, 52 Weeks Ending 8/12/18


YTD 2018

• 90% of CPG Omni-Channel

Sales Come From In-store

• 51% of CPG E-Commerce

Growth Comes from

“e”tailers other than

Amazon


Source: IRI eMarket Insights and Market Advantage, 2018 Building

Calendar Year w/e 8/12/18


Whole

Market View

Is Needed


Adding Value To Our Client’s Business

By Providing Insights & Support, Not Just Data

Industry Reality

There Is A Huge Need In Our Industry To Capture, Combine & Organize All Data

Onto A Single Platform

Many Solutions Provide The Parts


Industry Leaders working Together To Provide A

Competitive Advantage for Our Clients

Leading CPG Technology and Database Organization. Delivering Growth by

providing tools and data that allows Brands, Retailers

and Media agencies to better collaborate.

Global Leader in Amazon Performance Dashboard

& Deep Analytics

Global Leader in 6P Digital Shelf E-Commerce

Intelligence

1+ Billon annual transactions

Data from 600+ merchants

AmazonItem Level

Digital Shelf Data from

1,000’s of retailers

9+ million Total shoppers

100’s of millions

of listings monitored


Leveraging World Class Capabilities For Our Clients

Moving From Data To Insights to Allow For Faster Actions

IRI Delivers The Means To Get You

Where You Need To Go

We Will Deliver Growth By Providing Our Clients The Insights To Drive Their

Business with SPEED.

“Fill-in The Pieces”


This Partnership of World Class Leaders Provide Our Clients With A

Competitive Advantage Full Omni-Channel Coverage

Digital Shelf

In-Store Measurement

E-Commerce Channel Measurement

Omni-Channel Shopper Behavior

Amazon Market Share & SKU Level Measurement

September 11, 2018

CASE STUDY

Integrated Case Study – Category X


Overview

Purpose

• To illustrate how IRI, Clavis, and One Click Retail insights come together to tell a cohesive E-Commerce story.

• Please note that this case study highlights a starting point for analysis, yet there are many more follow-up questions that

these solutions could also help answer.

Sources

• IRI eMarket Insights

• IRI Shopper Diagnostic

• Client’s ePOS

• Clavis 6P Digital Shelf

• One Click Retail


Most of the B&M brand leaders’ growth is from E-Commerce

Source: IRI eMarket Insights, IRI Market Advantage, 52 Weeks Ending 08-12-18

-5.3%

3.0%

-2.2%-0.4%

0.4%

-3.0%

0.3%

-0.6%

1.1%

5.8%

1.9% 2.3% 1.7%

-0.5%

40.0%

8.9%

29.9%28.5%

1.1%

31.8%

18.1%

44.2%

11.0%

17.6%

28.9%

-1.5%

12.5%14.4%

NESTLE S ASWITZERLAND

COCA COLA CO NESTLE S ASWITZERLAND

THE HERSHEYCO

THE J MSMUCKER CO

KELLOGG CO MONDELEZ INTLINC

CAMPBELLSOUP CO

MARS INC CLOROX CO PROCTER &GAMBLE

LOREAL USA JOHNSON &JOHNSON

PROCTER &GAMBLE

MULO eCommerce


BUT B&M Brand Leaders are Struggling to Represent in E-Commerce


58.6

41.3

47.5

41.8

25.4

31.5 34.2

6.4

54.8

22.2

61.1

38.0

25.1

38.7

23.427.2

7.710.3

4.9

27.3

18.2

7.0

17.0

8.1

49.6

4.61.3

32.6

NESTLE S ASWITZERLAND

COCA COLA CO NESTLE S ASWITZERLAND

THE HERSHEYCO

THE J MSMUCKER CO

KELLOGG CO MONDELEZ INTLINC

CAMPBELLSOUP CO

MARS INC CLOROX CO PROCTER &GAMBLE

LOREAL USA JOHNSON &JOHNSON

PROCTER &GAMBLE

B&M Share eCommerce Share


Business Case Study Illustration

Question #1: How are my categories performing online

vs. off-line?


All of my categories are up with double digit growth in E-Commerce

1.8% 1.7% 2.2% 2.7%

-0.2%

0.6% 1.6%

-0.8% -0.9% -0.7%

4.1%

-3.5%

27.3% 27.3%

48.5%

26.2%

45.1%

35.0%

22.2%

41.2%

44.9%

15.2%

51.2%

54.6%

MULO eCommerce

Category A Category B Category C Category D Category X Category E Category F Category G Category H Category I Category J Category K




If you maintain greater market share online vs. off-line, you will win

disproportionately with increasing online shopper migration.

Question #2: What are my current category shares online

and how do they compare to their off-line shares?


Unlike most categories, Category X share online is ~2X vs. off-line

43%

22%

9%

5%

13%

6%

16%

7%9%

25%

18%

3%

30%

16%

5% 4%

22%

6%

15% 14%

6%

17%

5% 6%

B&M Share eCommerce Share

Category A Category B Category C Category D Category X Category E Category F Category G Category H Category I Category J Category K




If you maintain greater market share online vs. off-line, you will win

disproportionately with increasing online shopper migration.

Question #3: What is driving Client’s Category X to have

a stronger online share vs. off-line?


$3.4M

$3.7M

-$1.5M

-$0.5M

-$0.8M

$0.6M

$1.1M

$0.8M

-$0.3M

$0.4M

ALL OTHERS

CAMPBELL SOUP CO

MONDELEZ INTL INC

KELLOGG CO

PEPSICO INC

GENERAL MILLS INC

THE HAIN CELESTIAL GRP INC

LA FE FOODS

MARYS GONE CRACKERS

SNYDERS LANCE INC

Change vs. YA


ALL OTHERS

CLIENT

COMPETITOR 1

COMPETITOR 2

COMPETITOR 3

COMPETITOR 4

COMPETITOR 5

COMPETITOR 6

COMPETITOR 7

COMPETITOR 8

$9.8M

$7.3M

$2.3M

$2.3M

$1.9M

$1.7M

$1.6M

$1.5M

$1.3M

$1.3M

ALL OTHERS

CAMPBELL SOUP CO

MONDELEZ INTL INC

KELLOGG CO

PEPSICO INC

GENERAL MILLS INC

THE HAIN CELESTIAL GRP INC

LA FE FOODS

MARYS GONE CRACKERS

SNYDERS LANCE INC

Current

ALL OTHERS

CLIENT

COMPETITOR 1

COMPETITOR 2

COMPETITOR 3

COMPETITOR 4

COMPETITOR 5

COMPETITOR 6

COMPETITOR 7

COMPETITOR 8

Growing Sales On Amazon.com, the Client is the largest parent company within

Category X

CATEGORY X: Dollar Sales, Amazon.com


$3.3M

$2.2M

$1.0M

$91.7K

- $31.9K

$33.7K

CRACKERS PF GOLDFISH

CRACKERS GF ASSORTED

CRACKERS GF BASE

CRACKERS GF FLAVOR BLASTED

CRACKERS GF GRAHAMS

CRACKERS GF ORGANIC

Change vs YA

BRAND A

BRAND B

BRAND C

BRAND D

BRAND E

BRAND F

$7.0M

$3.5M

$3.0M

$301.9K

$12.6K

$81.7K

CRACKERS PF GOLDFISH

CRACKERS GF ASSORTED

CRACKERS GF BASE

CRACKERS GF FLAVOR BLASTED

CRACKERS GF GRAHAMS

CRACKERS GF ORGANIC

Current

BRAND A

BRAND B

BRAND C

BRAND D

BRAND E

BRAND F

Driving Sales - On Amazon.com, Brand A is the largest brand and the largest

dollar sales growth driver for the Client within Category X





Question #4: What are the primary drivers of growth for

the Brand A on Amazon.com?


The Top 5 Brand A SKUs represent around 86% of the brand’s sales on

Amazon.com


Source: IRI Market Advantage, Amazon.com ePOS Data, 52 Weeks Ending 04-01-18

Note: “Amazon.com” is an aggregate of available Amazon programs

$1.7M

$1.5M$1.5M

$740.0K

$486.9K

$297.3K$238.8K

$161.0K

$37.7K $35.7K $25.1K $24.8K $23.4K $22.0K $19.6K

25%

47%

68%

79%

86%90%

94%96% 97% 97% 98% 98% 98% 99% 99%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

$0K

$200K

$400K

$600K

$800K

$1.0M

$1.2M

$1.4M

$1.6M

$1.8M

$2.0M

UPC 1 UPC 2 UPC 3 UPC 4 UPC 5 UPC 6 UPC 7 UPC 8 UPC 9 UPC 10 UPC 11 UPC 12 UPC 13 UPC 14 UPC 15


$751.8K

$1.1M

$1.1M

$136.8K

$239.3K

$88.7K

$11.7K

$56.5K

$34.3K

$11.7K

GF BASE GF BASE CHEDDAR BULK CARTON TRBULK >30OZ 1CT CHEDDAR KIDS 30 OZ -…

GF ASSORTED GF ASSORTED MULTIPACK MP16.1 - 29.9OZ 30CT ASSORTED KIDS 29 OZ -…


GF BASE GF BASE CHEDDAR CLUB MULTIPACKMP >30OZ 30CT KIDS 45 OZ - 1410004613


GF FLAVOR BLASTED GF FB BULK CARTON TRBULK >30OZ 1CT CHEDDAR KIDS 30 OZ -…

GF BASE GF BASE WHOLE GRAIN BULKCARTON TR BULK >30OZ 1CT CHEDDAR…

GF BASE GF BASE COLORS BULK CARTON TRBULK >30OZ 1CT CHEDDAR KIDS 30 OZ -…


GF ORGANIC GF ORGANIC CHEDDAR DOYENTR REGULAR 4.5 - 8.4OZ 1CT CHEDDAR KIDS…

Change vs. YA

UPC 1

UPC 2

UPC 3

UPC 4

UPC 5

UPC 6

UPC 7

UPC 8

UPC 9

UPC 10

$1.7M

$1.5M

$1.5M

$740.0K

$486.9K

$297.3K

$238.8K

$161.0K

$37.7K

$35.7K

GF BASE GF BASE CHEDDAR BULKCARTON TR BULK >30OZ 1CT CHEDDAR…

GF ASSORTED GF ASSORTED MULTIPACKMP 16.1 - 29.9OZ 30CT ASSORTED KIDS 29…


GF BASE GF BASE CHEDDAR CLUBMULTIPACK MP >30OZ 30CT KIDS 45 OZ -…


GF FLAVOR BLASTED GF FB BULK CARTONTR BULK >30OZ 1CT CHEDDAR KIDS 30…

GF BASE GF BASE WHOLE GRAIN BULKCARTON TR BULK >30OZ 1CT CHEDDAR…

GF BASE GF BASE COLORS BULK CARTONTR BULK >30OZ 1CT CHEDDAR KIDS 30…


GF ORGANIC GF ORGANIC CHEDDARDOYEN TR REGULAR 4.5 - 8.4OZ 1CT…

Current

UPC 1

UPC 2

UPC 3

UPC 4

UPC 5

UPC 6

UPC 7

UPC 8

UPC 9

UPC 10

On Amazon.com, top 3 Brand A SKUs driving majority of dollar and percent growth




+275%

+275%

+78%


In-Store and On-line Sales and Pricing Across Various Retailers

BRAND A- UPC 1

$7.6M

$6.6M

$4.6M

$1.7M

$1.7M

$308.4K

$77.8K

$113.9K

$35.4K

Current

$542.5K

$409.8K

- $268.8K

$69.6K

$751.8K

- $83.1K

- $26.2K

$113.9K

$35.4K

Change vs YA

DOLLARS PRICE PER UNIT

$6.83

$7.78

$7.52

$8.31

$6.39

$8.21

$7.64

$8.29

$6.60

Current

-$0.24

-$0.19

-$0.04

-$0.49

-$0.61

-$0.33

-$0.19

Change vs YA

N/A

N/A

Source: IRI Market Advantage, Amazon.com ePOS Data, Latest 52 Weeks




Question #5: What is causing the lower growth rate on

the #1 Brand A SKU?


$1.7M

$1.5M$1.5M

$740.0K

$486.9K

$297.3K$238.8K

$161.0K

$37.7K $35.7K $25.1K $24.8K $23.4K $22.0K $19.6K

25%

47%

68%

79%

86%90%

94%96% 97% 97% 98% 98% 98% 99% 99%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

$0K

$200K

$400K

$600K

$800K

$1.0M

$1.2M

$1.4M

$1.6M

$1.8M

$2.0M

UPC 1 UPC 2 UPC 3 UPC 4 UPC 5 UPC 6 UPC 7 UPC 8 UPC 9 UPC 10 UPC 11 UPC 12 UPC 13 UPC 14 UPC 15

#1 Brand A SKU represents around 25% but isn’t growing at the rate of #2 and #3





#1 Brand A SKU maintained strong availability throughout 2018 on Amazon.com

Consistently in stock across Amazon throughout 2018 apart from one week where the SKU was in

limited supply (Feb 11th) and then OOS for 5 days following.

Source: Clavis InsightsNote: Analysis shown is for Amazon Prime Pantry. Analysis can also be done for Amazon.com, Prime Now, and Fresh.

Product

Client Item, Brand A, Pack of 6

ASIN A

1


Category X Brand AASIN A

1


#1 Brand A SKU shows strong performance

on user generated Amazon reviews and ratings

Product Detail page passing on both ratings and reviews, far exceeding target of 40 reviews and 4

star ratings


Category X

Category X

Client

Brand A

Category X

Category X

Client

Brand A


ASIN A

1


ASIN A

1

Type A

Type B

Type A

Type B


-0.26

0.22

0.03

-0.10

-0.28

Change vs. YA

4.69

4.62

4.48

4.74

4.30

GF BASE CHEDDARBULK CARTON TR 1CTCHEDDAR KIDS 30 OZ -

1410009655

GF ASSORTEDMULTIPACK KIDS 29 OZ

- 1410004713


- 1410004714

GF BASE CHEDDARCLUB MULTIPACK 30CTKIDS 45 OZ - 1410004613

GF ASSORTEDMULTIPACK 30CT KIDS

29 OZ - 1410004638

Current

UPC 1

UPC 2

UPC 3

UPC 4

UPC 5

$1.7M

$1.5M

$1.5M

$740.0K

$486.9K

GF BASE CHEDDARBULK CARTON TR 1CTCHEDDAR KIDS 30 OZ -

1410009655


- 1410004713


- 1410004714

GF BASE CHEDDARCLUB MULTIPACK 30CTKIDS 45 OZ - 1410004613

GF ASSORTEDMULTIPACK 30CT KIDS

29 OZ - 1410004638

Current

$751.8K

$1.1M

$1.1M

$136.8K

$239.3K

Change vs. YA

UPC 1

UPC 2

UPC 3

UPC 4

UPC 5

BUT unlike #2 and #3 Brand A SKUs,

#1 Brand A SKU dropped in Customer Review Rating

Amazon.com

DOLLARS CUSTOMER REVIEW RATING

Source: IRI Market Advantage, Amazon.com ePOS Data with Clavis Digital Shelf Measures, 52 Weeks Ending 04-01-18



Search Drives Sales, #1 Brand A SKU experienced the lowest % of days in the top

10 search results


Source: IRI Market Advantage, Amazon.com ePOS Data with Clavis Digital Shelf Measures, 52 Weeks Ending 04-01-18



#1 Brand A SKU is compliant, but not fully matched to trusted source and optimized

in Basic and Enhanced Content = opportunity to optimize search rank through SEO


Category

X

Brand A

ASIN A

1


Product Product

Product Description

Category X

Brand A

ASIN A

1


#1 Brand A SKU is not consistently visible or ranked at the top for many primary

category terms

• Consistently on the first page for the term [“A”] but not well ranked

• Failing to show up for [“B”], [“C”], [“D”] and other category terms


“A”

“A”

Product


ASIN A

1

Brand A Client Category X



Question #6: How big is the growth opportunity within

Category X in eCommerce and on Amazon.com?


There is tremendous upside potential for Category X in E-Commerce, since

household penetration is still quite small.

79.3

43.5

18.915.2

12.2

5.2 2.9 0.7 0.6

66.9

30.6

9.8 7.65.1

1.5 1.0 0.2 0.2

Total US -GroceryX

Total US -Walmart Total

Total US - Club Total US - Dollar Total US - MassXand

SupercenterX

Total US - Drug Total US -Internet

Total US -Walmart.com

Total US -Amazon.com

% HH Buying % HHs Buying 2x+

CATEGORY X: HH Penetration

Source: IRI CSIA, 52 Weeks Ending 03-25-18

Note: “Total US- Amazon.com” includes all Amazon programs, 1st party and 3rd party sales



Question #7: What are some examples of other insights

that can be drawn from this combination of data?


While the 30oz Brand A SKU has seen moderate increases in sales and share on

Amazon.com, other ASINs in the portfolio are showing stronger growth trajectory

ASIN-level Sales and Share Analysis (own and competitive)

Source: One Click Retail

Note: Data shown includes Amazon.com and Prime Pantry.

The highlighted ASIN is from Amazon.com and is one of several 30oz Cheddar ASINs.

While [ASIN A (Pack of 6)] has seen moderate increases in sales and share, it’s actually the [ASIN B (Pack of 30)] that has demonstrated the dominant increase in share.

The Pack of 30 has about 3X the weekly sales as the Pack of 6 item, and started to significantly increase sales at the beginning of the year.

ASIN A (Pack of 6)

ASIN B (Pack of 30)

Item DescriptionItem Description

CLIENT ITEM

COMPETITOR ITEM

CLIENT ITEM

CLIENT ITEM

COMPETITOR ITEM

CLIENT ITEM

COMPETITOR ITEM

CLIENT ITEM

CLIENT ITEM

Item

ASIN B (Pack of 30)

ASIN #

ASIN #

ASIN #

ASIN #

ASIN #

ASIN #

ASIN #

ASIN A (Pack of 6)


Amazon Product

Page Screenshot

ASIN A (Pack of 6)

There was a spike in “Lost Sales” due to Out of Stock in January and February on

Amazon.com, though the issue seems to have been resolved

Lost Sales due to “Out of Stock” for [ASIN A (Pack of 6)]

Lost sales due to insufficient inventory levels is one of the largest ways that vendors lose sales on Amazon. When and how much inventory Amazon orders is reliant on its internal ordering algorithms and logic triggers. This report helps OCR clients identify which items are under-ordered and provides them with the data needed to get the In-Stock Manger to intervene and manually order more product.

Source: One Click Retail

Note: Data shown includes Amazon.com and Prime Pantry.

The highlighted ASIN is from Amazon.com and is one of several 30oz Cheddar ASINs.


Recap

• Brand A is one brand that serves as a model for strong eCommerce performance with

strong growth rates vs. competition and as a result, online share outpacing Brick and

Mortar share.

• Since eCommerce Category X HH penetration is still <3%, there is tremendous upside for

Category X as it continues to focus on eCommerce acceleration and best practices.

• Brand A should prioritize the maintenance and acceleration of its top 5 SKUs due to scale

and growth to-date.

• For the #1 Brand A SKU, lower pricing on Amazon appears to be an important contributing

factor for the item’s growth to-date; however, its growth rate and dollar growth are lower vs.

#2 and #3 SKUs flagging opportunity and risk if not addressed quickly.


Next Steps

1. For the #1 Brand A SKU on Amazon:

• Improve search ranking on Prime Pantry for key search terms through SEO and

demand generation (AMS search)

• Continue to ensure consistent availability on Amazon.com

• Resolve trusted source matching for content on Amazon.com

• Dig deeper into customer reviews to understand what has caused the decrease in

average rating over the last year

2. Assess the success drivers for the #2 and #3 SKUs and explore opportunities to

replicate and accelerate growth


Leveraging World Class Capabilities For Our Clients

Moving From Data To Insights to Allow For Faster Actions

• Let data empower your organization to

move FASTER

• The data we used today is unique in

the industry because it comes from

several different sources

• Our best in class partnerships refines

and cultivates the data so our clients

can get to insights and actions with

SPEED

• Single Platform for reporting ease

“Fill-in The Pieces”


Fast Facts & Learn More

• Solution sets available for all clients

• Wide range of pricing

• Contact your IRI, Clavis or OCR client

service member or the emails below;

• IRI Jon Isca

• [email protected]

• OCR/Clavis Chris Perry

• [email protected]


Thank You!

IRI. GROWTH DELIVERED.

the new realities of e-commerce and the keys to online growth … · 2019-01-07 · mulo ecommerce...

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