ACNielsen Data Basics

Beacon United

Agenda

• Retail Sales Basics– Data Collection– Understanding the Data– Dimension Review

• Fact Review– Volume Sales– ACV– Velocity– Merchandising– Pricing

Retail Sales Basics

ACNielsen Data Sources

Consumer Information: • Consumer behavior

•Who’s buying, how are they buying, etc

Bob’s Grocery

Retail Sales Information:• Retail sales environment

•What’s selling, how is it selling, etc

ACNielsen Data Collection & Processing

• Items scanned at Checkout via UPC code• Price, Quantity, UPC and Item Description Recorded• Scanner Tape and Price Tape Sent to ACNielsen or Data Sent via

ACNielsen Data Processing

Scanner Data

Causal Data

Displays - Collected by Store Auditors once a weekFeatures - Centrally Collected and Coded Daily

Census and Sample based data are integrated for respective markets

DATADATADATADATADATA

ACNielsen Data Collection & Processing

• Census Sample Integration (CSI) means enhanced consistency and accuracy

ACNielsen Service Offerings

Grocery – Food $2MM+ Drug Mass Merchandisers Walmart Warehouse Clubs including Sam’s Club Dollar stores Military outlets Other Retail Measurement Services:

Convenience Stores Liquor Stores Ethnic Markets

ACNielsen collects data from the following channels:

Data Collection

Data Collection: Volume & Price

• Data is collected by UPC• Units• Price

• Characteristics allow UPC’s to be aggregated• Categories• Segments • SKU’s

• MarketWhere did the Purchases Occur?

• ProductWhat Level are You Interested In?(Category, Segment, Manufacturer, Brand, UPC)

• PeriodWhen did the Sales Take Place?

• FactHow will You Measure Performance?

Four Data Dimensions

Beacon United Databases

• PLN_Full_L2– 47 Retailer Trading Areas

with Remaining Markets

• Meijers_Cat0009

• Walgreen_Cat0006

• Target_Cat7

Retailer Markets

Retailer Offerings: Trading Area Retailer defined geography Census Based For example, Total Stop & Shop If Trading Area’s are available it is the preferred view Remaining Markets are all of an accounts competitors in a

specified geography

Market Dimension

ACNielsen Boston 2MM+Food Market

Stop & Shop Trading Area

Market Dimension

What’s the difference between a Market and a TA?

Product Dimension

Product DimensionProducts are built from the lowest level possible - the individual UPC - which serves as the primary building block for all other product levels

Period Dimension

Data Delivery: Periods

• PLN_Full_L2, Meijers_Cat0009, Walgreen_Cat0006, Target_Cat7

– Weekly Data– Updated Monthly– 2 Years Weekly/Monthly History– Approximately 2 Weeks Delivery from Close of Period

Fact Review Actual Volume Percent Change Share ACV Velocity Merchandising Pricing

ACNielsen Collects Two Scanned Facts...

$1.99$2.86

SMITH’s

• Units–Number of packages scanned for a product class or item during a specific

time period projected to the respective universe

• Equivalent Units– Same as above with the exception that each scanned package is exploded

by a conversion rate– i.e. Pound Basis, Ounce Basis

• Dollars–The measurement of the dollars spent by the customer on items during a

specific time period– Calculated not collected Computation: Projected item sales X Item selling price in each store

Fact Dimension

Volume Share

• Share is a Calculation Based on Unit volume, Eq. Volume or Dollar Volume.

• Think of Share as a “Subset” of Volume.• Share Enables You to Answer the Question:

HOW IMPORTANT IS MY PRODUCT TO THE CATEGORY?

Percent Change vs. Point Change

• Percent change is used when comparing VOLUME growth across periods/products/markets.

• Point change is used when comparing SHARE growth across periods/products/markets.

$ Vol$ Pct Chg vs YAG $ Share

$ Shr Chg vs YAG

10,656,589 11.3 74.5 0.67,689,708 13.3 53.7 1.42,927,322 7.3 20.5 (0.6)

Product B’s Dollar Volume increased 13.3% over YAG. Product B’s Dollar Share increased 1.4 points over YAG.

Fact Dimension

Product AProduct BProduct C

How Is ACV Measured?

All Commodity Volume

• A measure of the total DOLLAR volume of retail sales for a particular outlet or channel type.

• It includes all items that are sold in that store type

• %ACV serves as a good weighting factor when measuring distribution. It indicates how many consumers have the opportunity to purchase the product.

• Higher ACV stores serve more consumers– All stores are NOT created equal.

Fact Dimension

All Commodity Volume $ (ACV) Example

The 7 Food Stores In This Market Sell $300,000 Per Week

D) $36,000 (12%)

A) $36,000 (12%)

C) $36,000 (12%)

SMITH’s Grocery Chain* Has 3 stores in the market doing $132,000 per week for a total of 44% of the ACV

JONES’s Grocery Chain* Has 4 stores in the market doing $168,000 per week for a total of 56% of the ACV

Fact Dimension

C) $48,000 (16%)

B) $48,000 (16%)

A) $60,000 (20%) B) $36,000 (12%)

SMITH’s

JONES’s JONES’s

All Commodity Volume $ (ACV) Example

If these 3 stores sold your product during the week, what percent of the total ACV sold your product?

Fact Dimension

B) $48,000 (16%)

A) $60,000 (20%) B) $36,000 (12%)SMITH’s

JONES’s JONES’s

All Commodity Volume $ (ACV) ExampleIf these 3 stores sold your product during the week, what percent of

the total ACV sold your product? And the answer is…

Fact Dimension

B) $48,000 (16%)

A) $60,000 (20%)

B) $36,000 (12%)

$48,000 (16%) ACV +

$36,000 (12%) ACV =

$60,000 (20%) ACV +

$144,000 or 48% ACV

SMITH’s

JONES’s

Example Of % ACV (3 Stores)Item A Sales

Week 1

Week 2

Week 3

Week 4

4 Weeks

Store A (40% ACV)

Store B (35% ACV)

Store C (25% ACV)

% ACV Selling

ACV is non-additive (unless averaging) - 40% + 60% + 60% + 35% = 195%Average ACV = 195/4 = 48.8%ACV cannot be greater than 100%

Fact Dimension

A Review Of “% Of ACV Selling”

• The Percent of the ACV That Sold at Least One Unit of an Item During a Weekly orMonthly Time Period as Predefined onYour Database.

• It Does Not Account for Items That Are Stocked in the Store During the Period, But Did Not Scan (Sell) During The Period.

How Do I Know Which %ACV Measure To Use?

When Concerned With . . . Use . . .

Out of StocksShort-Term Events

Average Weekly %ACV

What is Highest Distribution

During a Given Period (New Items)

Max %ACV

Monthly %ACVTracking Long-Term Distribution Trends

Achieved in a Mkt or Acct?

Velocity Facts

Another Way To Look At A Sales Rate Is With Sales Per Million Dollars Of ACV

Definition:The Sales Of A Product For Every$1,000,000 Of All Commodity VolumeTo Which That Product Is ExposedAt Retail.

• Since “Sales Per Million” Is A Sales Rate Based On Activity Only In Stores Handling, There Are Several Useful Applications Of This ACNielsen Measure.

Sales Per Million Dollars Of ACV

Brand Y Annual Sales: $ 5,834,936

Annual Market ACV : $3,240,000,000

To Compute Sales Per Million Dollars Of ACV...

$5,834,936_________= $1,801

$ 3,240

This Means That For Every $1,000,000 In Food Store Sales, A Typical Store Sells $1,801 Of Brand Y.

A competitive item may have more sales overall, but this may be a function of its ACV Exposure...Your item may actually sell faster than the competition in a head-to-head comparison of the size of stores selling the products.

Volume

Sales / $MM

My Brand

Competitor A

Competitor B

ACV (MM$)

Sales per MM $ ACV/SS Example

Fact Dimension

%ACV Selling

Sales Per Point of Distribution

Allow for a fair comparison of the sales performance of products with different levels of distribution.

Eliminates distribution as a factor to equalize sales levels

Can not use to compare across markets

Sales per Point of Distribution

$ Sales per Point

Unit Sales per Point

Eq Sales per Point

Merchandising Facts

Breaking Down Promoted Volume By Merchandising Condition Allows You To Explain Sales Peaks

70%No Promo Volume

30%PromoVolume

Feature Volume

Display Volume

Feature & Display Volume

Temporary Price Reduction

Feature Collection

• Features are defined as retailer printed advertisements or other special printed promotions.

• Sources Include: Newspapers Flyers In-store circulars Mailers Supplements

• Because FSIs are manufacturer features, they are not included in feature measures

Where does Display Information Come From?

• Each week the Field Auditors gather display information on:– Location– Selling Price– Merchandising Information

• ACNielsen Display Conditions:– Retailer must participate– It must be temporary– It must be situated in a secondary selling location– It must contain actual product available to consumers for self-service

Pricing

Some Facts on Pricing

• Retail price facts are gathered from:– Retailer’s Price Files – Retail Displays– Feature Ads

• Price data is NOT collected on the same tape as store volumetric data.

Price Facts

Average PriceWeighted average price for all scanned sales of product

Non-Promoted PriceEstimated Product Price in the Absence of Promotion

Promoted PricesPrices recorded by stores with:

FeatureDisplayFeature & DisplayTemporary Price Reduction.

NOW...

Let’s Discuss Some OtherImportant Promotional Facts,Events & Evaluations

Different Ways To Look At Volume

• Promoted vs. Non-Promoted • Baseline vs. Incremental

TOTAL VOLUME

BaselineVolume

IncrementalVolume

Retail Sales Are Also Divided Into:

Baseline Volume

• The Baseline Volume Is The Normal Expected Everyday Sales In A Specific Store In The Absence Of Any Promotion.

• It Is Used As An Indicator Of The Fundamental Vitality Of A Brand/Item.

• The Difference Between Actual Volume Versus Baseline Volume Can Be Attributed To Promotional Activity.

We First Measure The Actual Volume For A UPC In A Store Over Time

1 2 3 4 5 6 7 8 9 10 11 12

Volume (000)Volume (000)

Week:Week:FeatureFeature

DisplayDisplay

TPRTPR

The Creation Of A Baseline Allows Us To Measure Incremental Volume

1 2 3 4 5 6 7 8 9 10 11 12

DisplayDisplay

TPRTPR

BaselineBaseline

The Creation Of A Baseline Allows Us To Measure Incremental Volume

1 2 3 4 5 6 7 8 9 10 11 12

DisplayDisplay

TPRTPR

BaselineBaseline

CategoryTrends Long Term

SeasonalityMarket Level

Effects

BrandTrends

Baseline Volume Includes Marketplace Conditions That Affect Sales of a Product

2,000,000

4,000,000

6,000,000

8,000,000

10,000,000

Baseline

Incremental Volume

• “Incremental” Means Volume Sold Above And Beyond What Normally Would Have Been Expected (Above Baseline).

• Generally, Incremental Volume Is Generated By Trade Support.

TOTAL VOLUME

PromotedVolume

Non Promoted Volume

Retail Sales Are Divided Into Two Basic Components:

Promoted vs. Non Promoted Volume

These measures are projected from actual store data, unlike baseline volume, promoted/non promoted volume are not calculations

• Non Promoted–Volume in those stores/weeks where NO promotion

(feature, display, TPR) is present• Promoted

–Volume in those stores/weeks where a promotion (feature, display, TPR) is present

Keep in Mind...

Non-Promoted + Promoted = Total VolumeBaseline + Incremental = Total Volume

BUTPromoted Incremental

Non-Promoted Baseline

Promoted and Non-Promoted Volume are actual, measured results

Baseline and Incremental Volume are expected, modeled results

Subsidized Volume

Total Brand ASan Francisco - 52 Week Period

7.4% of the pound volume sold on promotion, but

would have sold even without the

promotion...

7.4%4.2%

Base vs Inc Promo vs Non Subsidy

Incremental

Promoted

Subsidy

Non-Promoted

Baseline

Promotional Evaluation Measures

Promotion Effectiveness Index (PEI)

• PEI measures total volume relative to what would have normally been sold in the absence of any store level promotional activity (Baseline)

(Total Volume / Baseline Volume) x 100 = PEI

Examples: A PEI of 100 means that Total Volume was

equal to Baseline Volume A PEI of 350 means that Total Volume was

3.5 times greater than Baseline Volume

Definition of Lift

• Lift is the interaction between Baseline and Incremental volume expressed as a percent.

• Calculation: Incremental Volume

Baseline Volume

• Provides a relative gauge of promotion effectiveness when comparing events.

• Lift is a relative measure. You should always look at your actual volume and compare it against other Lifts for your brand or competitors brands where conditions are comparable.

Percent Lift = X 100

ACNielsen Data Basics

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