ACNielsen Retail Measurement Service

An overview

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Retail Index
• Periodic (generally monthly) monitoring with a panel of retail outlets.
– Excludes institutional sales, but includes retail channels

Collecting data on Purchases, Stocks, and/or Sales for product categories of interest.
– Measures and tracks sales units, volume, selling price, observed promotion and merchandising execution, encompassing an organization's own brands as well as competitive products

And projecting it, using statistical techniques to arrive at estimates.

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Objectives of Retail Index
• To Monitor Trends
– Market – Brands & Competition

• To Understand Distribution
– Width & Depth – Shelf Competition

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Methodology
• • • • • • • Retail Index data is based on measurement of consumer sales from a sample of outlets designed to reflect the channel being measured. The panel is spread across the country and represents all states across Pop Strata . The same fixed sample is audited on a monthly basis with field auditors physically counting retail stock holdings, then recording store purchases from any source (warehouse, wholesaler or direct). For the respective category that is to be audited each and every SKU stock is physically counted The ongoing measurement of these variables produces consumer sales as well as vital in-store information. (Opening Stock+ Purchases-Closing Stock = Sales) Due to the constantly changing retail environment, ACNielsen updates its defined universe and sample requirements on an annual basis. This is done to ensure the sample is representative of the channel being measured.
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Questions we need to ask… . Answers we need…

Is the market growing? Impact of Ads/Promos? Potential regions? Can I introduce a new pack type/ size and gain? Is any special segment growing faster? • •

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Is my product available? • Are Stocks Fresh?

Is my distribution efficient?

Is my brand moving or are my stocks piling up? • Is my brand/pack Out of Stock?

Stumped? Retail Measurement Service is the reliable research tool used worldwide to continuously track the market.
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Critical Inputs for Informed Decisions
If You Are Planning A New Launch Shortlist categories to launch Take go/ no-go decisions Find the right product, pack and price mix Identify markets for launch Predict potential market share Monitor performance of the new launch

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Critical Inputs for Informed Decisions
If You Are An Existing Player Evaluate performance vis a vis competition in various markets Identify underdeveloped markets for your brands
– Benchmark against competition within category, and on other categories

Identify gaps in product mix Identify emerging product, pack & price segments Assess competition activity Determine brand potential 7

Critical Inputs for Informed Decisions
If You Are An Existing Player Manage stocking and servicing levels Do price sensitivity analysis Evaluate performance of promotions Expand distribution Synergise internal distribution Benchmark against competition distribution Do production scheduling
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Key Benefits
• Managers can gauge product penetration, overall product performance, distribution, promotion effectiveness, and price sensitivity through measurement and integration of the following variables:
– – – – – sales and shares weighted and numeric distribution stock data including out of stocks pricing in-store merchandising

Analysis of all data is available via ACNielsen Advisor. This flexible software allows easy yet powerful interrogation of the rich Retail Index databases.

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Retail Micro Markets
ACNielsen | Retail Micro Markets has been designed to help FMCG marketers: • Identify micro opportunitiesrelevant to their goals • Devise strategies to optimize : • Regional distribution • Regional product mix • ACNielsen | Retail Micro Markets service monitors and analyzes the Indian FMCG sector with greater granularity. It tracks trends within more minute geographies and channels. Using the more actionable data, the Marketing and Distribution professional can plan, act and monitor brand performance in a more holistic manner. By combining data on category performance, competitive movement, depth of distribution, stock levels, price movements and new product introductions, Marketers can now focus on targeted areas more accurately

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Retail Micro Markets
ACNielsen | Retail Micro Markets can answer the following business concerns • How do I plan my distribution expansion programme? • How do I prioritize markets for new launches? • In which micro geography do I need to improve frequency of service? • Do I need to align the product assortment in accordance to consumer preference in each micro geography and channel? • Do I need to modify the product mix to address regional preferences?
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Example
• Brand C is the third largest national brand in a given category. Nationally, it enjoys a Value Share of 14 percent. However, this brand is present in only 47 percent of dealers nationally; these dealers contribute 69 percent of category sales at an all India level. By studying the micro level retail data for Brand C, two large opportunity areas for expansion were detected :
– – The largest market for the given category is Tamil Nadu contributing 15 percent to the national sales. However, Tamil Nadu contributes only 8 percent to the all India Value Sales of Brand C. Brand C is nationally under leveraged in the largest channel for the Category : Grocers. It has a low penetration in this salient channel at an all India level. However, in Tamil Nadu, the overall penetration is only 23 percent and amongst the Grocers, it is 22 percent.

Brand C has low market share and penetration in Tamil Nadu. Therefore, it is imperative for Brand C to improve its focus on this market. The marketer of Brand C needs to put together an effective Micro Strategy by ascertaining
– – – Channels that needs to be targeted Action that needs to be taken in the under leveraged channel. Devising a Channel wise strategy, evaluating implementation and monitoring performance on a regular basis for each State, is now possible using State X Channel type data from ACNielsen | Retail Micro Markets

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Example
Which Channels should be targeted for increasing sales for Brand C in Tamil Nadu? • Grocers constitute the largest channel in Tamil Nadu followed by Chemists and Pan Plus for Category X. Though Grocers is the highest contributing channel for Brand C, the brand is not very well distributed in this channel in Tamil Nadu. • Brand C reaches only 22 percent of Grocers; these 22 percent contribute to 58 percent of Category X Sales • Brand C, is under leveraged in Chemists and Pan Plus with17 percent and 6 percent of Brand C sales coming from these channels respectively • Therefore, Brand C can increase sales by focusing on key channels-Grocers, Chemists and Pan Plus.

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Example
• Further analysis, to devise a micro strategy for improving sales in Grocers, one of the key channels in Tamil Nadu for Category X.

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Modern Trade Service
• Modern Stores are fast becoming the consumers’ preferred shopping destination as they offer an increased product choice • extensive product displays, increased level of merchandising, changing nature of promotions and continuous new product launches, stimulate a continuous shift in the consumer’s product preferences – thus affecting unanticipated swings in the brands’ Market Shares. • Micro-level data in the Modern Trade channel on sales related parameters, on a month-to-month basis, enables Marketers to employ tactics that are not only relevant but differentiated enough to be effective in a unique environment • Given the unique character of Modern Stores, Marketers need to employ a differentiated strategy herein – whether it is for determining the product mix, price mix, promotions or in-store activities!
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ACNielsen| Modern Trade Service
• Important determinant of a Marketer’s success as it measures and monitors key category trends for a brand, and the corresponding competitive set, at a city level – making information actionable. • It gives a point-by-point comparison with the Traditional Channels enabling the formation of a differentiated strategy. • ACNielsen| Modern Trade Service helps the Marketer develop suitable micro-strategies for this channel by:
– Determining Growth Opportunities – identifying high growth category segments and markets – Benchmarking Growth Potential – by measuring performance of own brands with the competitive set – Understanding Consumer Preferences – by studying the winning Product Mix (Price/ Packs/ Promotions)
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Example - Determining Growth Opportunities
• • • Brand A and Brand B are competitive Premium Toilet Soap brands, in the same price segment, with an All India presence. They are sold through both Traditional and Modern channels. However, at 7.5%, Brand B has a much higher Market Share in Modern Trade as compared to the 6.6% Market Share of Brand A. The difference in Share between Modern and Traditional Channel is also higher for Brand B - indicating that it is well leveraged in the Modern Trade Channel. This data illustrates that the fast growing Modern Trade Channel holds immense potential for Brand A to increase its Market Share. How does Brand A go about it? By concentrating on key markets.

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ACNielsen| Modern Trade Service
What it is? City level estimates of Category and Brand sales Insights into the Traditional trade and Modern trade in each city Monthly reporting reports delivered within 45 days of the month end What it is not? No individual chain level reporting No information on POP, Display, Trade Schemes, Dealer margins, Instore Promotions
Categories Covered Cities Reported Hair Care Ahmedabad Personal Care Surat Fabric and Home Vadodara Care Chennai Baby Products Bangalore Food and Beverages Hyderabad Impulse Foods Madurai Contraceptives Delhi OTC Mumbai General Purpose Vishakhapatnam Cooking Medium Kochi Lighting Products Coimbatore Pune Nagpur Kolkata

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Market Information Digest
• The ACNielsen | Market Information Digest (MID) is a crucial reference tool for companies interested in Consumer Goods market. • It provides immediate access to valuable information on a wide range of product categories. • MID 2006 combines data from the most comprehensive primary and secondary data sources on India’s consumer landscape to offer a clear snapshot of 78 major product categories in terms of retail sales, media spends along with country background in terms economic, industry and demographic information. • Drawing upon India’s only database on the Indian retail market for branded FMCG and Durable goods, the ACNielsen MID 2006, provides subscribers an insightful tool to analyze market potential for a host of categories in the context of the Indian consumers’ media habits and brand preferences.
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Application
MID is used extensively by consumer goods marketers, distributors, advertising and media professionals to aid their marketing plans. Questions that can addressed by MID include • Which categories should I consider entering? Which categories are showing above average growth? Which segments and manufacturers are driving this growth? • Which manufacturer could be a take-over target? Who are the fastest growing manufacturers? What is the size of their business? • Which manufacturers do I need to target as a local publisher / broadcaster? • Are there strong local players? What are their brand sales? Who are their competitors?

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Features

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In-store observation
• • • Conducts in-store observation studies across all channels and markets, Provides manufacturers and retailers with visually verified information about categories, brands, items, retail execution and the competition. Personnel perform on-site observations to assess factors impacting sales and promotion performance, including the following:
– – – – – – – – – Distribution Existence of displays Display position and prominence Inventory levels Out-of-stock occurrences Shelf facings Product adjacency to competitors Linear measurement Lowest retail price

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Insights into
• Are my product displays set up at the recommended time and location? • How many facings are allocated to my brand, by trade channel? • How does my competitive activity impact my product's performance? • Are inventory levels adequate at the onset of my product's peak seasonal period?

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Key business benefits:
• • Provide insight into store activities not found in standard research reports, through the use of custom observations. Enhance decision-making ability with another dimension to Retail Measures Services tracking data that enables managers to match in-store observed causal to actual sales for a more comprehensive understanding of the factors influencing sales trends. Gain visual confirmation of trade promotions to verify proper execution. Investigate suspected condition problems at the store level to develop practical corrective plans. Ensure successful new product launches by tracking promotion compliance. Assist retailers with assortment decisions by supplying information that relates market share to shelf space allocation.

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