Nielsen Definations.pptx

STANDARD RMS FACTS & THEIR USES

Copyright ©2012 The Nielsen Company. Confidential and proprietary.

SALES

SALES VOLUME Sales of an item to the consumers expressed as a standard unit of measure (Kg, Lt etc.) specific to each category

VOLUME SHARE Sales Volume of a Manufacturer/Brand/SKU expressed as a percentage of total volume sales of the category (or of a specific segment)

SALES VALUE Sales of an item to the consumer expressed in the country currency. Sales value is calculated by the production system by multiplying the volumes sold in units with the average price

VALUE SHARE Sales Value of a Manufacturer/Brand/SKU expressed as a percentage of total value sales of product category (or of a specific segment)

SALES ITEMS Sales Items to consumers reported in SKU count

SALES ITEMS SHARE Sales items expressed as a percentage of the category sales.

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INSIGHTS FOR SALES FACTS

SALES VOLUME & SALES VALUE Always look at the share movement in relation to absolute volume movement. A share increase/decrease does NOT mean less/more volumes sold.

If the Total Category volumes increase and my brand volumes don’t increase at the same rate the share will decrease even though the absolute volumes of the brand have increased.

SALES ITEMS Categories that comprise of different pack types e.g. In JNSD, different pack types are plastic bottles, Tetra Pak, Glass bottles (Returnable / Non returnable), sales items provide the volumes expressed in pack types/ SKUs

Should a brand have a value share greater than its volume share, it is more expensive than the average brand in the market. Should the value share be smaller than the volume share, it would indicate a cheaper brand than market average

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SALES AND SHARE FAQS What is the size of the category and how is it trending? -Is there seasonality?

How important is each segment, manufacturer, brand?

What is their strength by trade channel and geographic region?

How is my brand performing over time?

What was the impact on sales and share due to: -Change in price?

-Change in distribution?

-New product introduction?

-Change in competitive action?

Standard RMS Facts and their Uses

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Copyright ©2012 The Nielsen Company. Confidential and proprietary.

DISTRIBUTION Numeric Handling / Distribution The percentage of the stores in the Nielsen universe that handle the product

Insights Numeric distribution tells the shop reach of a manufacturer/brand/SKU that handle the brand or the category out of total shops in the universe. Thus tells the ability of the manufacturer in establishing its presence in the retail trade Numeric distribution does not indicate the size of stores regarding turnover i.e. a small grocery = a large supermarket

Weighted Handling / Distribution The percentage of business accounted for by the numeric handlers of the specific brand/SKU

Weighted distribution therefore gives an indication of the importance of stores where the brand/SKU is distributed e.g. 1 Supermarket may equal 10 Small Groceries in terms of turnover for the category

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DISTRIBUTION FAQS What percentage of the outlets are handling our brands vs. our competitors?

Are we in the most important outlets? The most important stores within the outlets?

What are the opportunities for increasing distribution and where are they?

Do my sales increase as I increase distribution?

Can I increase my sales by increasing the distribution of the best selling products and decreasing the distribution of slower moving items?

Standard RMS Facts and their Uses

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Copyright ©2012 The Nielsen Company. Confidential and proprietary.

NUMERIC & WEIGHTED DISTRIBUTION

OUTLETS IN THE MARKET

Outlet Turnover Brand X

1

2

3

4

5

50

20

15

10

5

X

X

X

X

X

Brand Y

Brand Z

X

X

X

Numeric Distribution

Weighted Distribution

60% (3/5)

45% (45/100

60% (3/5)

30% (30/100)

40% (2/5)

35% (35/100)

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AS BRAND X’S DISTRIBUTION DECLINES IN JUL-AUG’15, ITS SALES VOLUME ALSO DECLINE. AS DISTRIBUTION (NUMERIC & WEIGHTED) PICKS UP SEP’15 ONWARDS, SALES PICKS UP National Pak + TER Brand X 16

600

14 13

12

13

13

500

14

13

13

13

12

12

10

10

400

11

11

8

300

6

200

4 2

100 2

3

3

2

2

2

2

2

2

2

2

2

0

0 JAN 2015 FEB 2015 MAR 2015 APR 2015 MAY 2015 JUN 2015 JUL 2015 AUG 2015 SEP 2015 OCT 2015 NOV 2015 DEC 2015 Numeric

Weighted

Sales Volume 1 K-Ltrs

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Copyright ©2012 The Nielsen Company. Confidential and proprietary.

OUT OF STOCK (OOS) Out of Stock An item is out of stock when no stock is found at the time of audit, but the store is a known handler of that product ( i.e. there is currently no stock found but there is evidence of invoice).

Numeric OOS Indicates the percentage of the stores in the Nielsen universe that handle the item or brand which did not have the item in stock at the time of audit

Weighted OOS Indicates the percentage of the total category turnover that is accounted for by the stores that handle the item but did not have the item in stock at the time of the audit

Insights Indicates the supply chain problems for a brand/SKU that create hindrance for the brand/SKU in reaching the retailer end

When a brand/SKU is faced with OOS situation, there is a high probability of sales shift towards competitor brands/SKUs that may result in significant share loss. When a particular outlet is found OOS for two consecutive months, it is declared as a non handler for that particular brand/SKU. Hence, consistent OOS situations in the retail trade may result in reduced NH

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OUT OF STOCK (OOS) FAQS What is our out-of-stock level? -Has it changed over time? -How does it compare to our level of distribution? -How does it compare to our competition?

Do out-of-stocks appear to be hindering our performance?

What are out-of-stocks costing us in lost sales?

Standard RMS Facts and their Uses

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Copyright ©2012 The Nielsen Company. Confidential and proprietary.

NET NUMERIC DISTRIBUTION Net Distribution Indicates the proportion of business or stores a brand is reaching considering the out of stock situation. Therefore the percentage of stores or business (WEIGHTED) that had the stocks at the time of audit.

Formula Net Numeric Distribution N.H –Numeric OOS Net Weighted Distribution W.H –Weighted OOS

Insights This provides both the Numeric and Weighted Distribution of a brand/SKU based on its actual presence in the universe.

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Copyright ©2012 The Nielsen Company. Confidential and proprietary.

NUMERIC NET DISTRIBUTION BRAND X

OUTLETS IN THE MARKET 1

2

3

4

5

6

7

8

JAN/FEB

X

X

X

X

X

X

MAR/APR

X

OOS

X

OOS

X

OOS

X

X

MAY/JUN

X

OOS

OOS

X

X

OOS

X

OOS

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X

Handling %

OOS %

Net Distribution %

60%

-

60%

80%

30%

50%

70%

20%

50%

10

After two consecutive periods of OOS & no purchases, an outlet becomes a non-handler

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Copyright ©2012 The Nielsen Company. Confidential and proprietary.

AS OOS INCREASES IN FEB’15, MAR’15 NUMERIC DISTRIBUTION DECLINES BAND A FAISALABAD 16.0 14.0 12.0 10.0

8.0 6.0 4.0 2.0 0.0 JAN 2015 FEB 2015 MAR 2015 APR 2015 MAY 2015 JUN 2015 JUL 2015 AUG 2015 SEP 2015 OCT 2015 NOV 2015 DEC 2015 Numeric Distr.

NUM OOS

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Copyright ©2012 The Nielsen Company. Confidential and proprietary.

STOCKS

Stocks Total Stock of an item in store at the time of audit (both forward and reserve stock) and expressed in the standard unit of measurement specific to total category stocks

Forward Stock The total volume of stocks of an item found in the forward area at the time of audit and is expressed in the standard unit of measurement specific to the category

Stocks Share Stocks of a brand expressed as a percentage of the total category stocks

Forward Stock Share Forward Stocks of a brand expressed as a percentage of the total category forward stocks

Insights Stocks provide an insight into the manufacturer's ability and trade support to meet the consumer demand for its brands in the retail outlets

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Copyright ©2012 The Nielsen Company. Confidential and proprietary.

STOCK COVER DAYS

Stock Cover Days The number of days that the stocks at the retailer end will last before being depleted at the current rate of sale.

Insights Stock cover days should ideally be as low as possible without running out-ofstock Should stock cover days increase consistently over time, it could be an indication of a problem with consumer pull for the brand/SKU Seasonal brands and markets will always have very high stock cover days in out-of-season, when the rate of sale gets lower

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Copyright ©2012 The Nielsen Company. Confidential and proprietary.

SHARE IN SHOP HANDLING

• Indicates the potential share if maximum distribution is achieved. • Is used to indicate brand strength where the brand is distributed. =Volume Share/Weighted Handling*100 Brand X stands at 20% share, however, its SISH is 26%. Opportunity to capture more share if more important doors are captured BRAND X KARACHI 90.0 80.0 70.0

35%

80.0 32%

74.8 26%

60.0

30%

25%

50.0

20%

40.0

15%

30.0

10%

25.2 20.0

19.5 5%

10.0 0.0

0% JAN 2015 FEB 2015 MAR 2015 APR 2015 MAY 2015 JUN 2015 JUL 2015 AUG 2015 SEP 2015 OCT 2015 NOV 2015 DEC 2015 SISH

Volume Share

Weighted Handling

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