The term “Big Data” has infiltrated business media outlets for a couple decades now. Managing big data has grown multi-billion-dollar companies like SAS, Oracle and IBM, and its use has made billions of dollars for companies like Facebook, Netflix and Amazon. SAS summarizes the value of data well, saying, “It’s not the amount of data that’s important. It’s what organizations do with the data that matters. Big data can be analyzed for insights that lead to better decisions and strategic business moves.” Mentionlytics summarizes the usefulness of large amounts of data to “uncover the hidden patterns, correlations and also to give insights so as to make proper business decisions. Basically, organizations have realized the need for evolving from a knowing organization to a learning organization. Essentially, businesses want to be more objective and data-driven, and so they are embracing the power of data and technology.”
As it relates to Nationwide Marketing Group Members selling appliances, data can help determine the most popular price points that should be floored and help them maximize profitability. Members can use data to either validate or contradict their “gut feeling” on what will sell, what brands consumers prefer, what price points will maximize volume and profit and more.
Did you know that the Nationwide Marketing Group team has been collecting data to help members make sound merchandising decisions for several years now? NMG has been collecting point-of-sale (POS) data from NMG Members across the country. The data is hundreds of thousands of retail sales transactions by category, brand, SKU and price that NMG refers to as Retail Sales Analytics (RSA).
Like SAS states, it’s what organizations do with the data that matters. And to that end, Nationwide just launched a new tool that helps Members do something with all of that data. The new tool, called the Assortment Rationalization Tool (ART), will help Members efficiently look at assortments from the six major categories (refrigeration, laundry, electric cooking, gas cooking, dishwashers, and freezers). Within those categories Members can analyze 21 minor categories like French door refrigerators, top-freezer refrigerators, upright freezers, freestanding smooth-top electric ranges, gas cooktops and more.
ART will produce a selling tool customized to each Member, with or without product pictures, using sell-in (shipment to Members) and sell-thru (retail POS data) to display:
- Balance of share (the percentage of units sold in various ‘price bands’ – i.e. $450-$500 – across the 21 minor categories for the collective NMG RSA data and the industry)
- NMG’s top 50 most productive SKUs for each of the 21 minor categories (productivity rank as measured by the metrics: number of sales floors a SKU is displayed on, unit sales, margin dollars, margin percent, sales trends and number of Members who buy a particular SKU)
- NMG’s top four most productive SKUs in each price band, 10-20 bands for each of the 21 minor categories
- The NMG Member’s top four selling SKUs for each of the 21 minor categories to allow for a member’s quick analysis as to whether they are selling SKUs that will maximize their profit potential
The ART will analyze large amounts of data and allow Members to answer efficiently and effectively a number of questions, including:
- Is my line-up merchandised according to the industry’s / NMG’s ‘price bands’ with the largest share?
- I have a SKU on my floor that is not selling / is not profitable, what are the most productive replacement options?
- I am thinking about adding a vendor to my assortment, which will supply price points / strong margin for my business?
- Is my sales team selling the models that NMG’s ART show as most profitable / productive?
- How do my ASP’s / cost / margins compare to my NMG peers?
Data is a crucial ingredient in making sound business decisions. Without data, decisions are “gut feelings,” and the stakes in today’s retail environment are too high to make decisions based on anything besides data. NMG’s scale, and most importantly desire to help our members compete, thrive and be profitable in a competitive industry, led to the development of this tool to help our Members. Helping a Member, via data, to floor profitable brands, products, SKUs and price points is a critical component of profitability. The ART tool is intended to easily help our Members ‘uncover the hidden patterns,’ as Mentionlytics states data should, and provide valuable insights that will lead to profit for NMG members.
“The development of this tool allows our members unique access to insights that will drive foot traffic, higher close rates and profitability,” explains Patrick Maloney, MNG’s SVP Merchandising. “ART is developed on the science behind retail. It combines industry information with POS data to deliver a clear snapshot of opportunities on our members floors. I am incredibly proud of our teams’ efforts and know that this tool will propel the merchants across Nationwide’s network to new levels of retail.”
Be sure to ask your Member Support Manager more about the ART tool and how it can help you transform from a ‘knowing company’ to a “learning company” and merchandise for profit.