Key Takeaways from the Coresight Research report Discovering Hidden Treasures in Your Supply Chain Data

The past couple of years have certainly been challenging for grocery retailers. The pandemic resulted in rapidly evolving consumer shopping habits, the acceleration of omnichannel commerce, labor shortages and never before seen supply chain disruptions. Retailers had to adapt, and adapt quickly, while navigating through significant margin pressures. Coresight Research recently released a great report that captured the perspectives of both CPG suppliers and retailers coming out of that challenging time. Pensa’s partnership with innovative regional grocer Lunds & Byerlys was highlighted. You can download a free copy of the report Discovering Hidden Treasures in Your Supply Chain Data here.

In the report, I found no small number of great insights, not only about the challenges faced by retailers, but also the opportunities that emerged from the crucible of the pandemic. One of the most compelling opportunities is data monetization.

First off, as a former grocery retail operator at Kroger and Harris Teeter, I am intimately familiar with managing margin pressures. Much focus has historically been put on optimizing cost structures, and rightly so, but costs can only be reduced so far before impacting customer experience.  Today, I work closely with leading retailers around the world who leverage Pensa’s ability to accurately capture shelf inventory data from an entire grocery aisle in seconds to optimize labor costs while simultaneously reducing out of stocks.

There is an old saying in the retailer world “sales cures everything”. Said differently, retailers recognize the importance of generating revenue and the opportunities for retailers to monetize data to unlock new revenue streams are rapidly expanding and maturing as technology innovations support new data monetization models at scale. How big is the opportunity?

According to the report, 87% of CPG companies are either currently buying data from retailers (36%) or plan to within the next 3 years (51%). The report estimates retailers can generate up to 1% of total sales in incremental data revenue. Based on the conversations I am currently having with leading retailers about data monetization, I believe that number can easily double. Uniqueness of data is key

The type of data most desired by CPG brands according to the report is on-shelf availability (OSA) data, and that’s Pensa’s sweet spot. Technology advances have now made it possible for retailers to monetize shelf inventory data at scale (while also internally leveraging that shelf inventory data to improve operations) to complement legacy data sources like point-of-sale data.

And the report points out that this type of data will be used collaboratively between CPG brands and retailers for mutual benefit. In fact, the report states 61% of retailers and suppliers share this type of data to improve sales, 57% to improve forecasting and 49% to improve margins.

But obstacles exist to realizing the benefits of new data monetization revenue streams. Many retailers are lacking an adequate monetization strategy The report states that 26% of surveyed retailers don’t know how to derive the insights and 20% lack the technology to do so.

Because the upside is so high and the barriers to achieving that upside are so low, I believe every retailer should have an aggressive data monetization strategy. If you would like to learn more about how Pensa can help you monetize a unique, highly accurate, net new, continuous feed of actual on-shelf inventory conditions, contact us, we can help.