Business Challenge
The consumer packaged goods (CPG) industry is undergoing significant changes. These changes are so pervasive that CPG retailers must reexamine fundamental revenue expectations that have served them well in the past. Factors such as lower birth rates, stagnant wages, and student loan debt that burdens millennials all contribute to flat or decreased revenue for CPG retailers.
The executives at this retailer knew they had to do something to create new revenue streams to increase overall revenue. What made the most sense was to look at the data the company collected. They asked themselves, “what are we doing with our data, and what could we be doing with our data?”
Data Insights Is the Key
Data is one of the most valuable assets a company has. However, having access to mounds of data is just the beginning. Having business intelligence based on that data is where the real value is. This CPG retailer was collecting data from a variety of applications, but they were not fully leveraging that data. They were missing opportunities to gain insights into that data that would empower them to create entirely new revenue streams in the advertising arena. By focusing on improving data insight, this retailer could not only improve direct selling to their own customers, they could build a business around their data.
Data Meaning Unlocks the Data
This CPG retailer had access to very rich data streams, including data from applications such as Salesforce and Adobe Experience Manager. They had access to data from marketing platforms such as DoubleClick for Publishers and Clickstream. They were compiling user behavior data from their own point-of-sale and e-commerce applications. And, they were getting data, including demographic data, from third parties.
Unfortunately, the retailer was doing virtually nothing with this data. Data Meaning came in and examined the available data streams before developing a strategy surrounding how to monetize the data. Data Meaning then built the platform architecture that enabled the retailer to execute the proposed strategy. A major part of the project involved handling the integration of data from disparate data sources by leveraging various technologies across the data stream.
Increased Internal Revenue
After Data Meaning’s help, results came quickly. This retailer had greater insight into consumer patterns of behavior as well as demographic data. This meant that they could determine what products consumers were buying and how they could sell more of those products.
More conversions, higher brand loyalty, and greater affinity for the brand during relevant buying cycles are all pertinent to a successful e-commerce solution. This retailer was able to achieve these things by creating a better retail experience through generating greater levels of relevancy and personalization to the customer.
Additionally, their new-found insight allowed for better marketing efficiency. And, because they can directly attribute marketing spend to revenue, this retailer can now answer the question, “what is my marketing ROI.” That’s something that most companies can’t do.
Creation of Vendor Revenue Stream
Data Meaning created a subscription-based portal where vendors can log in and access a high level of rich 1st-party data analytics. Because they have greater insights into their customer’s behavior, this retailer can provide customized insight to marketers from other companies that have brand affinity with this retailer’s customers.
By understanding their customers better, this retailer can determine what customer segments are most appropriate for other companies that want to purchase advertising space on their e-commerce platform. Ultimately, this retailer can charge a higher CPM for advertising space than other platforms such as Google or Facebook.
Development of an Opportunity Engine
Based on the technology that underlies the vendor portal, this retailer can identify opportunities where customers are highly likely to convert and sell that information at a premium to advertisers. This opportunity engine exists because of the immense amount of data to which this retailer has access. Using that data, they can determine where a potential customer is in the buying cycle for a product and when the customer has a high propensity to purchase that product. This insight enables advertisers to enhance direct selling to their own potential customers.
How Much is Data Insight Worth?
Clearly, data insight is extremely more valuable than raw data and is now a driver of revenue in its own right. Today, it’s as valuable to this CPG retailer’s business as the products they sell. It was challenging to make the connection between data and revenue. But once the realization was made that something they own already has value, without having to do much to it, it’s like found money.
With the new technologies designed and implemented by Data Meaning, this CPG retailer is on track to realize a 30% increase in advertising revenue. As expected, this dramatic increase in revenue is having a monumental impact on their business.
The Data Meaning Value Proposition
Organizations that don’t leverage data in the way this retailer is now able to do are going to get left behind in their marketplace. Through consulting, planning, and implementation, Data Meaning made it possible for this retailer to gain valuable insight into their data that they were able to monetize. Now, they are well-positioned to grow into the future.