Bring the Power of Data Into Your Store
There are five simple strategies that retailers can use to effectively leverage sales information to drive their businesses to new heights in 2018.
A pet retailer’s to-do list for 2018 would likely take up two or three sheets of paper. On top of standard challenges, such as optimizing shelf space and promotions, sellers also face huge new issues like ecommerce, an avalanche of SKUs and quickly shifting category trends.
One key to staying a step ahead of the game is data. Whether they know it or not, retailers have a host of proprietary data at their disposal and can gain access to
much more with just a little effort. GfK’s POS panel, for example, delivers quarterly pet marketplace reports to all participating retailers that include a wealth of information on nationwide trends, best sellers and pricing.
With so much to keep track of and learn, how can retailers make smart use of the data they have, driving better decisions with a minimum of spreadsheet hours? Here are five simple ways to leverage data wisely in 2018:
Identify and Reward Innovative Brands
Pet owners love products and manufacturers that make them feel ahead of the curve—like they are giving their furry friends something slightly better than the neighbor’s pets have. Delivering these innovative items to customers can set retailers apart from the ecommerce contingent. So, pet retailers should keep track of the SKUs that are winning the market with cutting-edge ingredients and packaging, and embrace them as their own. For example, natural products now represent more than 70 percent of all pet food sales, but citing this claim alone is no longer enough to stand out. Much smaller segments, such as organic, GMO-free, gluten-free and others, are helping to redefine the future of natural and are up a combined 114 percent versus 2012.
Stay Vigilant and Competitive on Pricing
As the market continues to evolve, it is essential to know how high or low you can go with your pricing to remain competitive against other retailers. The average price per pound (PPLB) of all pet food SKUs continues to rise, but its ascent has leveled off substantially in recent years. The 2017 PPLB was up 28 percent compared to 2012, but only up 1.8 percent versus 2016. Don’t let your competition stay aligned with market changes while you lag behind.
Be Ruthless About Space Allotments
Nothing is more precious to a retailer than merchandising space; and with so many products vying for your real estate, it is essential to take a cold, hard look at which SKUs are making the grade. With the data at hand, you should be able to understand which items are giving you the biggest “bang” per square foot, and which are not earning their keep. Have these calculations up to date at all times, adjusting as often as you can. One example: Meal enhancers are the new hot category in pet, and the number of total items has grown rapidly (482 at the end of 2017, compared to just 209 at the end of 2015). Be sure you know which meal enhancer items are hitting all the right notes and separating themselves from the pack; those can earn space on your crowded shelves.
Arm Your Sales Team with Data
After you use data to spot the hot new trends that matter to your customers, share the news. Both freeze-dried (up 357 percent compared to 2012) and frozen pet food (up 187 percent versus 2012) are categories that are growing and may offer unique benefits to your shoppers, so make sure you stay up to date to better guide their buying decisions. It will build trust and keep them coming back for expert advice.
Of course, there are many more ways to make smart use of data; think about what you would add to this list. The key is making sure you have all of the information you need to keep your business humming in the year ahead. Take stock and find the missing data pieces that will give you extra power and insight.
Sean Simpson is Client Service Manager on GfK’s POS Tracking (Pet) team. Need more data about the U.S. pet marketplace? Write to Marleen Cassarino (firstname.lastname@example.org) to find out how you can join GfK’s POS panel today.