In the fast-paced world of Consumer-Packaged Goods (CPG), knowing how well your products are doing in their category isn’t just a choice – it’s a necessity. It’s not just about having an excellent product and strong marketing; it’s about truly comprehending how your products measure up in their designated space.
With businesses striving for better decisions in this competitive arena, the ability to precisely gauge and analyze product performance has taken center stage. Today, we’re embarking on a journey to unravel the art and science behind assessing CPG product performance within a specific category.
When comparing your CPG product’s performance within its category, understanding which metrics can provide the most valuable insights is key. While there are many key metrics that help you gauge how your product is performing relative to the category and its competitors, there are a few that stand out, like:
These metrics, when harnessed effectively, paint a vivid picture of your product’s performance trajectory and its positioning within the competitive category landscape. Although a scoreline rarely tells the whole story of a game, the same is true for retail performance. Broad metrics like sales volume or total distribution are topline snapshots; growth-minded CPG manufacturers are more often interested in the nuanced, dynamic trends driving those leading indicators. This is where Byzzer can come into play.
Byzzer is NIQ’s platform for Emerging Brands, which accelerates the speed to insights and simplifies data analysis, so clients don’t need an army of analysts. Byzzer supports subscription and ad hoc purchases with access to data in less than 5 minutes.
The Item Ranking report, offered in Byzzer, is the “league standings” of individual product performance. It tells you which items are the most productive in your category and shows how your product stacks up. By ranking products by individual item, you can make like-to-like comparisons for all products in your portfolio. You can also identify assortment opportunities and risks.
The Item Ranking report is exactly as it sounds: a numerated list of top-performing individual products in a category for a selected market and period. You can also limit this report by product characteristics, allowing you, for example, to rank all “organic” products in the category so you can benchmark against your true competitive set. The rank accounts for total sales, sales growth, Distribution, Distribution growth, and velocity (sales per point of distribution) to factor in who is performing the best, not just who is the biggest. The Best-in-Class brands are those which are ranked in the top 20% (note, the rank is always looking at the item across the entire category which is exactly how a buyer will assess their category).
The first product listed is the best-performing product in the category. Each subsequent item is listed in descending order of total sales. The first three columns – Item, Brand and UPC – are descriptive, but the further you scroll, you’ll find metrics like: $ Sales, $ Sales LY (Last Year), Unit Sales, Unit Sales LY, Average Price, Average Price LY, TDP, TDP LY, Velocity, and more! The report also contains an additional chart that displays the top brands in the category, selected automatically. These are broken down by the number of each brand’s items that appear in the top, middle or bottom third of the ranking.
Some key takeaways:
The Item Ranking report lets you assess products through the same lens as a retailer. Retailers want their assortments to contain as many top-performing products as possible and eliminate (or delist) the lagging ones. The most straightforward tool they can use to make this distinction is a ranking of items by sales. The Item Ranking report helps you understand how your products fit into this hierarchy and gain an easy-to-comprehend rationale for securing additional distribution from retailers.
The Item Ranking report is built for one purpose; to rank individual UPCs in a category by performance. To learn how each item earned its place on the list or anticipate which items might perform well in the future, you need to dive deeper into the underlying numbers.
Pay special attention to New Item from top-ranked brands!). Even if these items don’t rank particularly high, they can indicate a dominant brand trying to increase its category share or attempting to capitalize on a trend.
At its most basic, the Item Ranking report tells you which product in the category is the most popular and best-selling for the period and market selected and how your product(s) compare. Look a little closer, though, and you can find out if your category is top-heavy, with just a few brands dominating dozens or hundreds of trailing UPCs. You can also see if different brands rank higher when sorted by different characteristics or if there are new category entrants making headway. The Item Ranking report may not tell the whole story, but it will show you where you stand.
Click on the image to take a closer look.
Some key insights we can take away from this Item Ranking report:
In the rapidly evolving landscape of Consumer-Packaged Goods (CPG), gauging the performance of your products within their designated category is no longer a choice but an imperative. Beyond crafting exceptional products and effective marketing, understanding how your offerings fare within their competitive sphere is crucial. This pursuit of insights is especially critical in the dynamic world of CPG, where strategic decisions can make or break a brand. By embracing key metrics like TDP, Velocity, and Sales, businesses can unveil a comprehensive view of their product’s trajectory. However, amidst the complexity, tools like Byzzer emerge as beacons of simplicity, empowering emerging brands with swift access to data-driven insights. Through the lens of the Item Ranking report, businesses can make informed choices, mirroring retailer perspectives and enhancing their competitive edge. As we navigate this journey, we’ve unraveled the art of decoding CPG product performance, illuminating pathways to success within this intricate landscape.
NIQ has partnered with Foodbevy, and now CPG members will receive a free trial, as well as three complimentary reports. Don’t miss this opportunity to transform your brand’s growth trajectory.
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