Is pursuing data-driven worth it, even for smaller suppliers and retailers?

Jodean Robbins

Originally printed in the February 2021 issue of Produce Business.

The term ‘data-driven’ conjures up images of big companies, big data and big bucks, but many companies may be surprised to learn they do have access to data for decision-making.

“Twenty years ago in category management, every supplier had to create their own path,” says Steve Lutz, senior vice president, insights and innovation at Category Partners, headquartered in Idaho Falls, ID. “Today, engaging in a data analytics program with retail is completely accessible even for smaller suppliers because the analytic tools and systems have been developed, and the retail data is widely available. Suppliers and retailers are already sophisticated in managing a range of complex data inputs in other areas of their business. Retail data analysis is no different.”

Any analysis of the cost-benefit of data must begin with its use.

“Insights when analysed appropriately can drive actionable solutions that create sales growth and brand recognition,” says Jamie Postell, director of sales North America for Chiquita in Fort Lauderdale, FL. “While data is certainly worth the investment, it’s even more important to understand how to use the data to create data-driven insights and implement valuable programs for both retailers and consumers.”

Economy Information

Instead of investing in purchasing expensive data-sets, companies can begin with data they already own or collect.

“If smaller organisations don’t have the funds to source third-party data, they can look as close as their own records to observe whether it is growing same store or account sales and determine possible movement,” says Cynthia Haskins, president and chief executive of New York Apple Association (NYAA) in Victor, NY. “Share this information with the retailer so the two can better partner in the future.”

Companies can also look to public third-party sources of data. “Data has always been an important part of marketing, and as our world has become more digital, the data touch-points have increased and made insights available in almost real-time,” says CarrieAnn Arias, vice president of marketing at Naturipe Farms, Salinas, CA.

Following a market or category leader may be another approach.

“A company without the resources to buy big data can use the marketing strategy ‘follow closely behind’,” says Dr. John L. Stanton, chairman and professor of food marketing at St. Joseph’s University in Philadelphia, PA. “Simply pick a leader and watch them closely.”

Scalable Access

Even data with a price tag can have various entry points.

“The great thing about data-driven research is that there are many options that can be scalable,” says Chiquita’s Postell. “Some options at a lower tier of spending may not necessary carry all of the bells and whistles from a data or attribution standpoint, but learnings can still be gotten, and business lift/impact can still be felt. The key is understanding what an organisation wants to learn or achieve from an investment and then being very purposeful towards that aim.”

IRI works with close to 100 different produce suppliers and dozens of retailers in data-driven analytics.

“There is a spectrum,” Parker says. “Just do something in that space; you don’t have to go to the mega plan right away. For example, looking at sales trends for your specific customer versus their competition allows you to bring them ideas versus what others are doing.”

The price of the Stratum tool provided by 84.51° is based on the size of a company’s business at Kroger, explains Catherine Cowan, insights account manager at 84.51° in Cincinnati, OH.

“This allows produce companies of all sizes to use this tool,” she says. “In fact, we do have produce companies of all sizes who invest in this data resource, and it’s a valuable investment — particularly for users who invest in learning how to use the tool and leverage the data to achieve their goals.”

IRI’s Parker notes certainly there have been major large-scale data-driven produce campaigns in past years with great success.

“But that’s not all that’s available,” she says. “The majority of companies would benefit on a smaller scale by using data to pinpoint who their audience is and where they spend marketing dollars.”

Value In Collaboration

As data-driven marketing becomes more prevalent in non-perishables, so does deeper collaboration between retailers and suppliers.

“Leveraging data-driven marketing to better meet consumer needs generates value for retail partners, thus fostering and strengthening business relationships,” says Azul Meza, marketing manager at Fyffes in Coral Gables, FL.

Collaboration through opportunities such as loyalty marketing can play a key role in achieving shared objectives, states Chris Keetch, director of produce and floral for The Giant Company in Carlisle, PA.

“Retailers can support suppliers by utilising their own assets and data to target customers and deliver an equity-driving message beyond price that connects with shoppers and influences behaviors at key purchase decision points,” he says.

Data presents an opportunity for suppliers and retailers to start with common knowledge and work forward.

“When everyone is looking at the same facts, then decisions can be made together,” says Parker. “We have seen the success of collaboration based on data. ‘How can your product help me reach consumers I want to reach?’ should be a question retailers are asking suppliers.”

The supplier-retail relationship tends to dictate the level of engagement for most suppliers.

“The third or fourth supplier usually does not have the relationship or even account knowledge to walk into a retailer with a performance review and change things,” says Lutz. “The retailers have to see their suppliers either as having a large enough stake in the success of their business or demonstrated expertise in the category. Just claiming to have data is likely not enough. Also, what supplier is inclined to bring insights to a retailer and then have that retailer give the business to a competitor? The relationship must translate back to actual activities driven by data that benefit both the retailer and the supplier.”

It’s important for retailers to build a financially feasible model for produce companies, asserts Naturipe’s Arias.

“The produce industry does not benefit from the same kind of margins that other industries may have to spend on data,” she says. “A significant benefit retailers could provide is having a scalable model that’s affordable for the perishable category and specifically for produce. This will help make it possible for produce brands with smaller budgets to invest in data-driven marketing, which will ultimately benefit the retailer.”



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