Upload
temira
View
39
Download
0
Embed Size (px)
DESCRIPTION
Intelligence and insights Jonathan Nowell. What is significant about this information?. Agenda – Intelligence and insights. Nielsen BookScan and information in the book supply chain Data or intelligence? BookScan at work Growing Sales Supply chain efficiencies Conclusions. - PowerPoint PPT Presentation
Citation preview
BISG Conference February 2004 Slide 1
BISG Conference February 2004 Slide 2
Intelligence and insights
Jonathan Nowell
BISG Conference February 2004 Slide 3
What is significant about this information?
BISG Conference February 2004 Slide 4
Agenda – Intelligence and insights
Nielsen BookScan and information in the book supply chain
Data or intelligence?
BookScan at work Growing Sales Supply chain efficiencies
Conclusions
BISG Conference February 2004 Slide 5
Information and the book supply chain
Identifying &describing books
Identifying &describing books
Finding booksFinding books
Orderingbooks
Orderingbooks
Measuring &analysing book
sales
Measuring &analysing book
sales
ISBN agencyEditorial
ISBN agencyEditorial
Nielsen BookData,Bowker,Ingram,
B&T
Nielsen BookData,Bowker,Ingram,
B&T
Wholesalers,TeleOrdering
Nielsen BookNetPubNet/Easy
Wholesalers,TeleOrdering
Nielsen BookNetPubNet/Easy
NielsenBookScan
NielsenBookScan
Book
supply chain
Book
supply chain
BISG Conference February 2004 Slide 6
Intelligence and insights – data?
Data – information – intelligence
Intelligence improves decision-making on tactical and strategic levels
Key learning Information in context – e.g. Publisher’s Lunch Don’t publish by numbers – e.g. Vernon God Little, Strange
Incident … Employ analysts – e.g. Random, Harper … Be ambitious – e.g. set high returns reduction targets
BISG Conference February 2004 Slide 7
BookScan – The context …POS data – ISBN, volume, time, price
Territory Panel Coverage of the retail book market
Panel size USD Millions pa
Estimated total retail book market
US 70% (Publisher estimate) $7.4bn WiP to size
Australia 90% $0.8bn $0.9bn
Ireland 65% $0.1bn $0.2bn
New Zealand N/A N/A $0.1bn
South Africa 80% $0.2bn $0.2bn
UK 95% $2.6bn $2.8bn
BISG Conference February 2004 Slide 8
Agenda – Intelligence and insights
Growing Sales (the right promotional mix) Harper Collins, Australia
Strategic (genre analysis) Simon & Schuster, US
Supply Chain Efficiencies (Inventory and sales data)
Time Warner, UK
BISG Conference February 2004 Slide 9
Brian Murray, CEO at HC, Australia
How does Harper Collins, Australia use BookScan?
BookScan Data + HC analysis = Improved Decisions
1 Planning Decisions
2 Reprint Decisions
3 Marketing and Publicity Decisions
and Who benefits?
BISG Conference February 2004 Slide 10
1. Planning Decisions
Before BookScan
Decisions based on• own list of books, • own experiences,• warehouse shipments
Publisher’s retail knowledge and awareness limited
After BookScan
Decisions based on • broader market,• actual sell through,• rate of sale,• true backlist,• RRP and ASP,• sales by channel
Publisher’s retail knowledge and awareness improved
BISG Conference February 2004 Slide 11
Case Example: Planning for The Hours
BookScan data:• 7 film tie-ins from 4 publishers• Week by week sales, RRP, ASP
Analysis:• Weekly sales potential of 2000-6000 units in key week• A 2-4x increase in peak week• Sales continue for at least 3 months after film
Implications:• To achieve this velocity 15,000 had to be in the market• Needed to print 20,000• Market only ordered 10,000 units on sub
BISG Conference February 2004 Slide 12
2. Reprint decisions
Before BookScan
Decisions based on • warehouse shipments,• outstanding backorders,• “feel” of the market
Reprints dangerous financially; when Publishers did reprint it was usually too late and the
quantity was not optimal
After BookScan
Decisions based on• sell-through percentage,• unsold stock in market,• projected new orders,• forecasted retail sales,• sales strength by channel
Reprint frequently with confidence to maximise “hot” titles
BISG Conference February 2004 Slide 13
Case Example: Bride Stripped Bare
0
2500
5000
7500
10000
12500
15000
JunW4
Julw1
JulW2
JulW3
JulW4
AugW1
AugW2
AugW3
AugW4
AugW5
1) Initial Print 15k
2) Serial and Feature newspaper coverage
3) Sell Through = 50%; Reprint 10K
4) What more can we do?
BISG Conference February 2004 Slide 14
Case Example: Bride Stripped Bare
4) What more can we do to drive this book?
• What if we had another $30K to spend on marketing?
• Can we get more publicity?
• Do our booksellers have enough stock?
• Do we have enough stock?
• How long does it take to reprint?
• How many could sell over the next 4 weeks?
HC Decision: Immediate author tour if we can book TV
BISG Conference February 2004 Slide 15
Case Example: Bride Stripped Bare
0
2500
5000
7500
10000
12500
15000
JunW4
Julw1
JulW2
JulW3
JulW4
AugW1
AugW2
AugW3
AugW4
AugW5
1) Confirm TV interview
2) Book 4 day author tour
3) Extend marketing effort 8 weeks
4) Sell Through = 60%; Reprint 15K
BISG Conference February 2004 Slide 16
Case Example: Bride Stripped Bare
0
2500
5000
7500
10000
12500
15000
JunW4
Julw1
JulW2
JulW3
JulW4
AugW1
AugW2
AugW3
AugW4
AugW5
1) Publicity impact = 4 times increase
2) Sell through 80%+
3) Reprint 25K
BISG Conference February 2004 Slide 17
Case Example: Bride Stripped Bare
0
2500
5000
7500
10000
12500
15000
JunW4
Julw1
JulW2
JulW3
JulW4
AugW1
AugW2
AugW3
AugW4
AugW5
116K in print
65K sold through retail
25K unsold in retail
70% sell throughSome stock outs
BISG Conference February 2004 Slide 18
3.Marketing Decisions
Before BookScan
It’s impossible to measure the effectiveness of marketing spending
• author tours, publicity• festivals• print advertising• TV advertising• radio
Publishers spend $25-$50M pa on marketing efforts
After BookScan
It is still difficult, but possible to measure the effectiveness of some spends
It is possible to predict sales increases within a range
Publishers should re-focus spending on marketing efforts that lead to measurable sales increases for booksellers
BISG Conference February 2004 Slide 19
Preliminary Analysis
Author Tours less effective, often too costlyTV, Print, Radio Ads usually too costly to make impactNewspaper Serial less effective, timing an issue
Talkshow TV, Radio difficult, limited control but effectiveNewspaper feature difficult, limited control but effective AW Weekly selection difficult, limited control but effectiveOprah difficult, limited control but still works!Film Tie Ins difficult, limited control but effective
Bins, POS to be determined
BISG Conference February 2004 Slide 20
Agenda – Intelligence and insights
Growing Sales (the right promotional mix) Harper Collins, Australia
Strategic (genre analysis) Simon & Schuster, US
Supply Chain Efficiencies (Inventory and sales data)
Time Warner, UK
BISG Conference February 2004 Slide 21
SAT Weekly Sales by Top Publishers Aug2002-Aug 2003
Nielsen BookScan sales
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
8/4/
02
8/18
/02
9/1/
02
9/15
/02
9/29
/02
10/1
3/02
10/2
7/02
11/1
0/02
11/2
4/02
12/8
/02
12/2
2/02
1/5/
03
1/19
/03
2/2/
03
2/16
/03
3/2/
03
3/16
/03
3/30
/03
4/13
/03
4/27
/03
5/11
/03
5/25
/03
6/8/
03
6/22
/03
7/6/
03
7/20
/03
8/3/
03
8/17
/03
8/31
/03
Week Ending
Bo
oks
So
ld
(519,011 books sold by top publishers this period)
Test TestTestTestTestTestTest
BISG Conference February 2004 Slide 22
AP Total Weekly Unit Sales by Top Publishersin Comparative Subjects*
2003
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
20,0001/
5/03
1/19
/03
2/2/
03
2/16
/03
3/2/
03
3/16
/03
3/30
/03
4/13
/03
4/27
/03
5/11
/03
5/25
/03
6/8/
03
6/22
/03
7/6/
03
7/20
/03
8/3/
03
8/17
/03
8/31
/03
9/14
/03
9/28
/03
10/1
2/03
10/2
6/03
11/9
/03
11/2
3/03
12/7
/03
12/2
1/03
Week Ending
Bo
oks
So
ld
Test
Total Books Sold in these Subjects - 260,289Sales include current and prior editions
*Subjects Include: Bio, Calc, Chem, Econ, Phys, Stat, US Gov&Pol, US
Source: Nielsen Bookscan
(Publishers include: Kaplan, TPR, Barron's)
BISG Conference February 2004 Slide 23
Agenda – Intelligence and insights
Growing Sales (the right promotional mix) Harper Collins, Australia
Strategic (genre analysis) Simon & Schuster, US
Supply Chain Efficiencies (Inventory and sales data)
Time Warner, UK
BISG Conference February 2004 Slide 24
Rebecca units by week
-2,000
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
11/0
1/20
03
25/0
1/20
03
08/0
2/20
03
22/0
2/20
03
08/0
3/20
03
22/0
3/20
03
05/0
4/20
03
19/0
4/20
03
03/0
5/20
03
17/0
5/20
03
31/0
5/20
03
14/0
6/20
03
28/0
6/20
03
12/0
7/20
03
26/0
7/20
03
09/0
8/20
03
23/0
8/20
03
06/0
9/20
03
20/0
9/20
03
04/1
0/20
03
18/1
0/20
03
01/1
1/20
03
15/1
1/20
03
29/1
1/20
03
week ending
Uni
ts
Distributed units
TCM sales
This is a straight plot of weekly distributed copies and weekly sales out figures. It doesn't show much !
Possibly your distributor couldn't cope with the trade demand at this point and so distribution slipped and then picked up again. Alternatively, some retailers could have been quick to order following the Big Read publicity and others didn't react until a week later.
BISG Conference February 2004 Slide 25
Rebecca
0
20,000
40,000
60,000
80,000
100,000
120,000
11/0
1/20
03
25/0
1/20
03
08/0
2/20
03
22/0
2/20
03
08/0
3/20
03
22/0
3/20
03
05/0
4/20
03
19/0
4/20
03
03/0
5/20
03
17/0
5/20
03
31/0
5/20
03
14/0
6/20
03
28/0
6/20
03
12/0
7/20
03
26/0
7/20
03
09/0
8/20
03
23/0
8/20
03
06/0
9/20
03
20/0
9/20
03
04/1
0/20
03
18/1
0/20
03
01/1
1/20
03
15/1
1/20
03
29/1
1/20
03
week ending
Cum
ulat
ive
units
Cum. distribution
TCM Cum.
This shows cumulative (lifetime) data for both distributed copies and sales out units. Where the lines are parallel it means that sales out are being exactly balanced by distriubted copies in. The distance between the two lines indicated the amount of stock in trade.
BISG Conference February 2004 Slide 26
Rebecca sales Vs Stock
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
50,000
11/0
1/20
03
25/0
1/20
03
08/0
2/20
03
22/0
2/20
03
08/0
3/20
03
22/0
3/20
03
05/0
4/20
03
19/0
4/20
03
03/0
5/20
03
17/0
5/20
03
31/0
5/20
03
14/0
6/20
03
28/0
6/20
03
12/0
7/20
03
26/0
7/20
03
09/0
8/20
03
23/0
8/20
03
06/0
9/20
03
20/0
9/20
03
04/1
0/20
03
18/1
0/20
03
01/1
1/20
03
15/1
1/20
03
29/1
1/20
03
week end
units
TCM sales
Stock in trade
Stock in trade can be calculated each week by taking the opening stock in trade and adding week one distributed copies minus week one sales out to re-calculate stock in trade that week (see graph data sheet). This graph shows the stock in trade each week vs the sales out each week. The distance between the two lines shows the potential for returns if sales suddenly slumped.
You can see that in the latest week, stock is already reducing whilst sales are still accelerating, which is what you want in order to eat up the huge stock in trade explosion that occurred due to the Big Read publicity, but you clearly don't want the ratios to drop to a level where sales demand can't be met.
BISG Conference February 2004 Slide 27
Rebecca stock ratios
0
5
10
15
20
25
30
35
40
45
11/0
1/20
03
25/0
1/20
03
08/0
2/20
03
22/0
2/20
03
08/0
3/20
03
22/0
3/20
03
05/0
4/20
03
19/0
4/20
03
03/0
5/20
03
17/0
5/20
03
31/0
5/20
03
14/0
6/20
03
28/0
6/20
03
12/0
7/20
03
26/0
7/20
03
09/0
8/20
03
23/0
8/20
03
06/0
9/20
03
20/0
9/20
03
04/1
0/20
03
18/1
0/20
03
01/1
1/20
03
15/1
1/20
03
29/1
1/20
03
week ending
ratio
Weeks stock at current weeks sales
Stock to sales ratio
Here I have played about with some ratios. The RED line is taking the current weeks sales and dividing it into the stock to calculate how many weeks of stock you have in the trade.
The BLUE line divides stock by sales to get a straight ratio. The way I think of this is that with a ratio of say 5 (as at end of May) when a copy of Rebecca was sold you had four others on a shelf somewhere (not necessarily the shop where the sale was made from as this data is at market level).
BISG Conference February 2004 Slide 28
Rebecca and The Big Read
Conclusions build up a history of "similar" titles (e.g. HB Fiction Branded
Author) to forecast the required inventory to sales ratios
• Leading to better decisions on re-prints or promotions and better matching of inventory to demand.
• Improved returns estimates (how much) stock is actually in the trade and is this increasing or decreasing
BISG Conference February 2004 Slide 29
Rebecca and The Big Read
Conclusions
Improve the inventory position prize or PR beneficiaries (Rebecca). Intelligent supply chain management "push" copies into the trade in the knowledge that returns are unlikely
Build in exception reporting. In the case of Rebecca the distribution and sales lines are running parallel and about 15% - you might build variance parameters of 10% and 25%
BISG Conference February 2004 Slide 30
Conclusion – if you are not using BookScan intelligence in the following areas…call us!
Spotting the bestseller Catching the high flyer Managing the core stock Merchandising Growing sales Knowing market share Monitoring seasonality Reducing returns Negotiating currency New title subbing Planning Marketing Regional analysis
Inventory management Store distribution Timely reprints Validation Cost reduction Genre sizing Product definition Author acquisition Agent negotiation Imprint acquisition Gap analysis Format selection Price point analysis
BISG Conference February 2004 Slide 31
David Young’s big wins …
1. Bye, bye bullshit - it's impossible for anyone in the industry be they agents, publishers or authors to inflate sales statistics. We know a great deal more about our industry as a result.
2. Rate of sale out of stores - previously we relied on anecdotal information and reprinted in reaction to orders placed rather than sell through.
3. Reliable bestseller lists that can be run at classification level
BISG Conference February 2004 Slide 32
BISG Conference February 2004 Slide 33
The cost of returns to the trade Every book returned costs both the retailer and the publisher
In 1998, the UK book trade part funded a project by KPMG to estimate the costs of returns to the Booktrade
Back in 1998, the conclusion arrived at was that for EVERY book returned it cost the…
RETAILER - £0.50 or $ 0.92 PUBLISHER - £1.00 or $ 1.80 TOTAL COST TO TRADE - £1.50 or $ 2.70 per book
Assuming that the costs within the USA are comparable, what do you think the paybacks would be for each 1% drop in the US returns rate?
BISG Conference February 2004 Slide 34
Cost of returnsbased on the volume sales picked up by BookScan USA during 2003
For every 1% drop in the US returns rate, the trade could bank…
Publishers… $15.2 millionRetailers… $7.5 millionTotal trade… $22.7million
For a publisher with a 5% market share this is worth
$0.75million
For a retailer with a 5% market share this is worth
$0.38million
If the US could mirror the UK and drop returns by 7% over 5 years, it would be worth…
$5.25 million a year to the bottom line for a medium (5% share) publisher
$2.6 million a year to the bottom line for a medium (5% share) retailer
AND THE WHOLE TRADE BENEFITS !