Background

A national brand Consumer Packaged Goods (CPG) company experienced a significant decline in points of distribution (POD) for one of its leading brands at a large regional chain. Over a 12-month period, the brand’s POD decreased by 25%, from 6,450 to 4,862. This downward trend started in early 2022 and was particularly concerning for the brand’s top Stock Keeping Unit (SKU), which saw a 21% decline in distribution.

Problem Overview

• Overall, POD Decline: The brand’s POD dropped from 6,450 to 4,862.
• Top SKU Performance:
  • 12-month POD reduction: from 88 to 67 (21 less stores).
  • Monthly POD fell drastically from 56 to 19, before stabilizing between 30 and 40.
• Store Analysis:
  • The regional chain had 130 stores.
  • Over the past six months, only 52 stores sold at least one item from the brand.
  • 78 stores did not sell any brand items, including 24 high-potential (A or B level) stores.

Data-Driven Approach

1. RNI Database Utilization: The Retailer Network Insights (RNI) database provided crucial data to identify the distribution gaps.
2. Store Filtering: The 24 high-potential stores not carrying the brand were pinpointed using the RNI database.
3. Selling Story Development: A compelling narrative was crafted to demonstrate the brand’s value by highlighting sales velocity and performance in competitor stores.

Strategy Execution

• Targeted Selling: The sales team used the insights to create a targeted selling strategy, focusing on the 24 high-potential stores that were not carrying the brand.
• Data Presentation: They presented data showing the brand’s ranking and sales velocity in competitor stores, making a strong case for why the regional chain should carry the top SKU.

Results

• Immediate Action: The identified voids in the 24 stores were quickly addressed, leading to these stores starting to carry the brand again.
• Sales Recovery: The brand’s sales numbers in these stores returned to historical levels.
• ROI Achievement: The client experienced a significant return on investment (ROI) from this data-driven intervention.

Key Takeaways

• Importance of Data: Utilizing the RNI database and analytics was crucial in identifying the specific stores to target and crafting a compelling selling story.
• Focused Selling Strategy: Directly addressing high-potential stores with tailored data helped in quickly regaining distribution and sales.
• Impact of Data-Driven Decisions: This case demonstrates how strategic use of data and insights can lead to significant business outcomes, including recovery of lost sales and enhanced distribution efficiency.

By leveraging detailed store-level insights and focusing on high-potential opportunities, the national brand CPG company was able to turn around its declining POD trend and achieve significant ROI.