IRI, a leader in delivering big data and predictive analytics for the FMCG sector, today revealed that the number of products available per store across all major FMCG retailers in Europe has declined in the last year in every country except Germany.
The analysis was revealed by Jose Carlos González-Hurtado, president of IRI International during a special session of the Consumer Goods Forum Global Summit that took place in Cape Town, South Africa last week. Together with Brenda Korneef, business executive, group marketing & corporate strategy at Tiger Brands, he examined why assortment can be used as a strategic growth opportunity for FMCG marketers and retailers and the role of powerful big data and analytics technologies.
IRI also launched a new thought leadership white paper, ‘Shrink to Grow’, which unveils a unique methodology for assortment optimisation using advanced analytics modelling and the very latest in big data technology. The methodology looks at the category as a dynamic product mix that can enhance value for brands, categories and retailers.
Providing shoppers with the best line-up of consumer goods has always been a challenge for retailers. However with product offer being a key driver in store choice, getting it right is critical. An overabundance of products for several years has made identifying which brands to stock even more difficult. Retailers are also concerned not to miss opportunities to satisfy shopper desires and innovate.
With assortments starting to shrink, a trend that IRI believes will continue, it is time for consumer goods manufacturers to work with retailers to define the real value of a brand or product presence according to what is really impacting the shopper’s propensity to purchase says IRI.
The IRI whitepaper also proves that there is no direct relationship between an average number of items in store and revenue sales. It suggests an approach that reviews the incremental sales based on the attractiveness of products’ characteristics’ (or attributes’).
“An overabundance of FMCG products at the same time as limited shelf space, more competition between private label and national brands, and more frequent change of products stocked by retailers demands a radical new approach to winning for both retailers and manufacturers,” said Paul Hinds, senior vice president, retail slutions at IRI. “It is clear that retailers and manufacturers can reduce assortment and still grow sales if they closely monitor assortment with big data analytics and technology.”
IRI’s white paper ‘Shrink to Grow’ is available on: http://www.iriworldwide.com/en-GB/insights/Publications/Shrink-to-Grow-Create-Competitive-Advantage-with