Focus on Ranking Metrics of Critical Trade and Merchandising Activities to Maximize Program Impact and ROI
CHICAGO – May 8, 2018 – Most CPG organizations today understand the importance of metrics as they evaluate which in-store activities drive volume and sales, and the underlying factors that impact performance. However, it’s critical to harness the right metrics to create a more comprehensive merchandising strategy, developing a more accurate picture of how best to direct in-store resources against shelf, display and feature ads. A new IRI® Point of View issued today, "Merchandising Strategy: Optimize In-Store Performance for Growth with Metrics That Matter,” takes a closer look at identifying the most impactful metrics for measuring performance against sales goals.
“Manufacturers and traditional retailers remain under intense competitive pressure, and impactful in-store activities are critical for continued growth,” says Bill Ilaria, principal of IRI In-Store Solutions. “Trade spend and related selling expenses account for 30-40 percent of a manufacturer’s profit and loss, but in-store ROI is in decline. As a result, marketers must understand which in-store activities will move their organizations forward.”
At the heart of IRI’s Metrics That Matter™ approach is establishing a validated ranking of how three in-store elements — display merchandising, shelf configuration and feature — can work in harmony to maximize lift. This ranking gives brand and retail partners the perspective necessary to prioritize activities and sharpen the direction of execution and in-store performance. These metrics become the cornerstone of a collaborative organization, focusing marketers on change management to execute flawlessly across the most important metrics. More specifically, marketers gain an increased understanding of key in-store variables, including:
- Points of interruption (number of displays per store) versus stopping power (one large display).
- Impact/importance of variety on display.
- Absolute shelf space or share of space.
- Importance of specific feature activity (front/A) and share of features.
“The Metrics That Matter framework really changes the game,” concludes Ilaria. “Understanding why and how metrics matter across an organization really sets the groundwork for a cross-functional focus on defined activities, directing every arm of an organization to the same
place — success and growth.”
About the Report
“Merchandising Strategy: Optimize In-Store Performance for Growth with Metrics That Matter” is a free report available from IRI. To download the report, please visit http://www.iriworldwide.com/Insights/Publications/Merchandising-Strategy.
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