In our industry—as in any other field—we hear buzzwords or jargon so often that the terms seem worn out through overuse. But sometimes those same terms come up in a fresh context and take on a whole new meaning. That was my experience this February at the inaugural Shopper Insights Management Association (SIMA) conference, with the familiar concepts of omni and big data.
Omni comes from the Latin omnis, which translates loosely as “all” or “every.” Used as a prefix in omnichannel, it means integrating sales and marketing approaches across all online and offline retail channels. Big data got its name from the high volume and velocity of data generated in the digital age, and in our field refers to the large data sets collected through point-of-sale, loyalty programs, web browsing, social media, and so on. To be clear, omni and big data weren’t the featured topics at the conference, but I found myself examining the concepts of omni and big data based on my conference impressions.
I’ve written before about the importance of omnichannel marketing (see my take on omnichannel collaboration in 2019 Retail Marketing Trends), and mining big data for actionable insights is Foresight ROI’s specialty. Unlocking big data reveals the “what”—what happens when CPGs and their customers do X, Y, and Z—and predictive analytics tools (like Foresight ROI’s solutions determine the “now what?” In other words, insight becomes foresight when the right tools are brought to bear on big data.
My work keeps me steeped in details and data points, but I’m reminded now to step back and take in the big picture, which is big data’s enormous potential within truly collaborative partnerships vs. the current model in which either the CPG or the retailer gets the better end of a give-and-take relationship.
Just as placing big data in a big-picture context renews excitement in its potential, applying the concept of omni beyond just e-commerce helps us understand what needs to happen in retail marketing and merchandising moving forward. Marketers have seen an explosion of data from smartphones, e-commerce, frequent shopper data, and so on, and both CPGs and retailers would like to converge all those data streams. In fact, a video about SIMA traces the association’s genesis to “the No. 1 question” posed by Category Management Association (CMA) members: how to synthesize available big data sets and then derive insights that have value from a category management perspective? SIMA, part of CMA, aims to provide answers.
One definition of omni is “without limits,” and that’s the propulsive idea behind making big data even bigger by combining it. This means razing siloes separating certain business functions within CPG companies (namely shopper insights, shopper marketing, and category management). It also means dismantling some of the moss-gathering walls between CPGs and retailers that hamper the exchange of shopper data and insights.
Based loosely on questions posed at the SIMA conference, here are some thoughts about the future and focus of this new organization and about the intersection of category management, shopper insights, shopper marketing, and data analytics.
Why are category managers clamoring for big data consolidation and shopper insights?
- In category management, every inch of space matters, but apart from limited physical space, category managers see a wide-open frontier in the form of shopper data and insights that has yet to be charted. Tapping big data to gain a fuller understanding of shopper behavior may help optimize floor space, shelf space, and product mix. The challenge is turning insights into actionable solutions at the store level.
- This hankering is nothing new. In a decade-old (2008) CPGmatters magazine poll, “using more shopper insights” was the most suggested way to improve the effectiveness of category management, chosen by roughly a third (32%) of respondents.
What stands in the way of integrating all available shopper data?
- Aside from the technical issues of harvesting, merging, storing, processing, and interpreting vast amounts of data, there exists within CPG companies a lack of cross-functionality, and if teams aren’t working or strategizing together—if, indeed, they are competing for budget dollars—the data exchange isn’t happening.
- However, as one SIMA presenter pointed out, cross-functionality among category management, shopper insights, and shopper marketing makes sense. Category management is about products, and the shopper insights function is about people. Combined, they bring people and products together. Shopper marketing plays the intermediary role by matching the right people with the right products.
- Responding to a 2015 Shopper Centric Retailing survey, 11.5% of retailers admitted they don’t provide any POS, loyalty, or shopper insight info to their suppliers, while 38.5% said a minimal amount is provided. Yet those same retailers reported that 73.1% of suppliers provide a moderate to considerable amount of consumer and shopper insights at the category level.
How can these barriers be overcome?
- Four years later, CPG and retailer relations are still lopsided. CPG marketing execs report that just one-fourth (26%) of their programs qualify as “true” collaborations with retailers, according to Shopper Marketing magazine’s 2019 Trends survey, whereas most of the time it’s driven by one or the other’s own objectives. It’s time that relations evolved—and not just for the sake of leveraging shared shopper data.
- The 2015 survey shows there’s a wide gap between the perceived availability of shopper insight data (high) and retailers’ effectiveness in applying the data (low). Specifically, for category planning, 63% of retailers and manufacturers described their ability to apply shopper data as zilch or limited.
- This points to a need for education as well as third-party solution providers who can wrangle big data into actionable insights. Part of SIMA’s mission is to provide training and resources, and to connect CPGs and retailers with solution providers who can meet their specific needs.
Circling back to omni, Foresight ROI’s tools give users a taste of omniscience—or perhaps omnipotence. Click here to learn how predictive analytics are akin to super powers. Ready to harness that power? Contact us today.
Rick Abens serves on the executive board of the Shopper Insights Marketing Association, part of the Category Management Association.
Foresight ROI is the leader in shopper marketing measurement, decision support, and software solutions for CPG companies and retailers. To learn more about our measurement, software or industry ROI benchmark solutions, contact us at: contact@ForesightROI.com