Katz Training 01.20.09

Confidential & Proprietary Copyright 2008 The Nielsen Company
Nielsen Training
Katz Graduate School of Business
January 16, 2009
Confidential & Proprietary
Copyright 2008 The Nielsen Company
Foundation of Analysis:
Retail Measurement Data
Slide 2
Agenda
Overview of Nielsen
Data Collection
Foundation of Analysis
4 Dimensions
Overview of terms,
definitions
Nitro training /
demonstration

Company Overview
Slide 4
We are the worlds leading provider of marketing
and media information, leading publisher of
business-to-business magazines and e-media and
leading producer of trade shows and conferences.
We harness the power of our information and the
expertise of our people to help businesses of all kinds
discover their growth opportunities through better
understanding of consumers, markets and industry
trends.
Who We Are
What We Do
Why We Do It
Were in business to serve business and aim to
provide our clients with superior service and value, to
grow our business profitably, and to deliver superior
returns to our shareholders.
The World Leader in Understanding
Consumer Behavior
Slide 5
Nielsen Global Reach
Services in over 100 countries
The
Americas
Schaumburg, Illinois

Europe, Middle East and Africa
Wavre, Belgium

Asia
Pacific
Hong Kong,
China
World HQ
New York, NY
ACNielsen Presence
Slide 6
Provides millions of people around the
world with business and professional
intelligence

Market leader with premium brands
New York (USA)
42,000 employees worldwide
$4.3 billion (2005)
Quick Facts The Nielsen Company
Slide 7
Our History
Founded in 1923: Arthur C. Nielsen, Sr.
Pioneered retail, media measurement disciplines
Developed concept of market share
Developed original television & radio ratings business:
Nielsen Families
Slide 8
Our Assets & Brands are Leveraged to
Support and Grow our Partners
businesses
Client
Business
Partner
Nielsen Client Partners
Many of the Worlds Best-Known Brands
Data Collection & Quality
Source of Scanning Information
Slide 12
A Look at the Consumer Packaged
Goods [CPG] Industry
Consumer
Manufacturer
Retailer
Slide 13
Nielsen Collects Data from
Retailers & Consumers...
Consumer
Manufacturer
Retailer
Data
Slide 14
Nielsen Collects Data from
Retailers & Consumers...
& sells / trades data to the
manufacturer & retailer
Consumer
Manufacturer
Retailer
Data
Slide 15
Source of Information
Consumer sales
Retail price
Retailer Sample
Stores

Slide 16
Consumer sales
Retail price
Retailer Sample
Stores
ACNielsens Field
Auditors

Display presence
Custom observations(inventory
levels, facings, linear shelf
measurements, etc.)
Slide 17
Retailer Sample
Stores
ACNielsen's Field
Auditors

ACNielsens
Feature Coders
Consumer sales (audit or scan)
Retail price
All retailer print advertising
Standardized ABC feature coding
Display presence
Custom observations(inventory
levels, facings, linear shelf
measurements, etc.)
Slide 18
We Collect Data Across Multiple Outlets ...
Drug Stores
Gas Convenience
Stores
Independent
Food Stores
Supermarkets
Mass
Merchandisers
Chain Convenience
Stores
Supercenters
Slide 19
We Use Two Primary Methods to Collect
Raw Data . . .

Scanning

and
In-Store Field Audits
Retailers provide sales and price data
scanned purchases
all UPC-coded items
each week for every store included in sample
Foundation of Analysis
Slide 21
Provide an overall approach to analysis of data
Provide analysis tips for using facts in an analysis
Determine the best fact to use in a particular situation
Provide a foundation for understanding some of
the common differences in facts and help
determine the best choice for an analysis.
Goal and Objectives
Slide 22
Accurate Data Consists of Four Parts
Periods When did it occur?
Markets Where did it happen
geography, sale territory or Retailer
Products What item(s), brand(s), flavor(s) am I
interested in?
Facts What type of issue?
Slide 23

Periods

Slide 24
Periods
Monthly (4 wk) and Weekly hard-coded time periods
reside on all Heinz databases
Monthly data goes back 5 years
Weekly data goes back 3 years
We also have stored several years of hard coded 52 week time
periods
Custom time periods have also been created for your use
(Latest 4, 12, 24, & 52 Wks, Fiscal Quarters, etc.), built off
of the monthly & weekly periods
When using the custom time periods, be sure to select the correct
ones for the measure you selected
Monthly time periods should be used for all ACV-based measures
Weekly time periods must be used for all promotion-based
measures (including ACV by promo type)
Slide 25

Markets

Slide 26
4 Regions & 9 Divisions for Census
Pacific
Mountain
West South
Central
West North
Central
East North
Central
New
England
Mid-
Atlantic
South
Atlantic
East South
Central
West
Central
East
South
26
Slide 27
West
Pacific
California
Oregon
Washington
Mountain
Arizona
Colorado
Idaho
Montana
Nevada
New Mexico
Utah
Wyoming
East
New England
Connecticut
Maine
Massachusetts
New Hampshire
Rhode Island
Vermont
Mid Atlantic
Pennsylvania
New Jersey
New York
Census Regions & Divisions
Central
West North Central
Iowa
Kansas
Minnesota
Missouri
Nebraska
North Dakota
South Dakota
East North Central
Illinois
Indiana
Michigan
Ohio
Wisconsin
South
West South Central
Arkansas
Louisiana
Oklahoma
Texas
East South Central
Alabama
Kentucky
Mississippi
Tennessee
South Atlantic
Delaware
Florida
Georgia
Maryland
North Carolina
South Carolina
Virginia
West Virginia
27
Note: Markets Defined by US Government
Slide 28
ACNielsen Total U.S. 52 SCANTRACK
Markets
Portland
Seattle
Sacramento
San Francisco
Los Angeles
Salt Lake City/Boise Denver
Phoenix
Las Vegas
San Diego
West Texas/
New Mexico
Oklahoma City/Tulsa
San Antonio
Dallas
Houston
Omaha Des Moines
Minneapolis
Tampa
Kansas City
Little Rock
Memphis
New Orleans/Mobile
Birmingham
Grand Rapids
Milwaukee
St. Louis
Chicago
Cleveland
Detroit
Indianapolis
Cincinnati
Columbus
Pittsburgh
Buffalo/Rochester
Nashville
Miami
Atlanta
Orlando
Louisville
Charlotte
Jacksonville
Richmond
Raleigh/Durham
Washington DC
Baltimore
Philadelphia
Hartford/
New Haven
New York
Boston
Syracuse
Albany
Note: Markets Defined by Nielsen
Slide 29
Maps are a geographic representation at the time of development and may not reflect recent changes. Please refer to the market profile for county listings.
Example: ACNielsen SCANTRACK

Atlanta - Food
Whitfield
Murray
Gilmer
Fannin Union
Towns
White
Clay
Lumpkin
Dawson
Pickens Gordon
Bartow Floyd
Chattooga
Cherokee
Cleburne
Polk
Carroll
Heard Randolph
Chambers
Harris
Troup
Meriwether
Coweta
Fayette
Clayton
Henry
Spalding
Pike
Upson
Lamar
Monroe
Jones
Baldwin
Hancock
Putnam
Jasper
Morgan
Greene
Oglethorpe
Clarke
Oconee
Walton
Gwinnett
Rockdale
Newton
De Kalb
Fulton
Fulton
Douglas
Paulding
Cobb
Cherokee
Forsyth
Hall
Banks
Jackson
Barrow
Haralson
Butts
Talbot
Alabama
Tennessee
South Carolina
Georgia
Slide 30
_______________________________________________ ATLANTA __________________________________________________________
|
Supermarket Composition and | Claritas Estimates
NSUS Sample Representation | as of January 1,2004
as of Mar04 | % US
Number NSUS | TOTAL POPULATION 5,905,600 2.0%
Over Sample | TOTAL HOUSEHOLDS 2,163,200 2.0%
$2MM Cooperation | EFFECTIVE BUYING INCOME($000) 119,291,928 2.2%
|____________________________________________________________________
Major Retail Chains |
KROGER 143 YES | ACNielsen Type Food Stores
PUBLIX 135 YES | ACNielsen Control Estimates
INGLES 70 YES | as of December 31,2001
SAVE RITE 43 YES | Number % US ACV ($000) % US
BI LO 17 YES | TOTAL FOOD STORES 2,592 1.6% $ 9,258,802 1.9%
FOOD LION 13 YES |
QUALITY FOODS 12 NO | STORES $4MM AND OVER 555 7,892,907
WAYFIELD FOODS 12 NO | STORES $2MM AND OVER 623 8,103,955
|____________________________________________________________________
|
| Market by County
Wholesaler Representation | CHAMBERS AL CHEROKEE AL CLEBURNE AL RANDOLPH AL
SUPERVALU YES | BALDWIN GA BANKS GA BARROW GA BARTOW GA
PIGGLY WIGGLY ALABAMA DIS YES | BUTTS GA CARROLL GA CHATTOOGA GA CHEROKEE GA
MERCHANTS DISTRIBUTORS YES | CLARKE GA CLAYTON GA COBB GA COWETA GA
MITCHELL GROCERY YES | DAWSON GA DE KALB GA DOUGLAS GA FANNIN GA
ASSOC WHOLESALE GROCERS YES | FAYETTE GA FLOYD GA FORSYTH GA FULTON GA
| GILMER GA GORDON GA GREENE GA GWINNETT GA
| HALL GA HANCOCK GA HARALSON GA HARRIS GA
Wholesaler Information from | HEARD GA HENRY GA JACKSON GA JASPER GA
Trade Dimensions' Store File | JONES GA LAMAR GA LUMPKIN GA MERIWETHER GA
| MONROE GA MORGAN GA MURRAY GA NEWTON GA
| OCONEE GA OGLETHORPE GA PAULDING GA PICKENS GA
| PIKE GA POLK GA PUTNAM GA ROCKDALE GA
| SPALDING GA TALBOT GA TOWNS GA TROUP GA
| UNION GA UPSON GA WALTON GA WHITE GA
| WHITFIELD GA CLAY NC
|
|
| COPYRIGHT 2004 A.C. NIELSEN COMPANY 04/12/04
Slide 31
Trading Areas & Competitive Markets
Sample/Census Trading Area: counties it includes are
defined by the particular retailer, data reported is for that
retailers stores only

Competitive Markets: all retailers within the trading area
counties that participate in the sample are included in the
data reported, this includes the trading area particular
retailer sales as well
Slide 32
Maps are a geographic representation at the time of development and may not reflect recent changes. Please refer to the market profile for county listings.
Example: Custom SCANTRACK
Trade Area -
Cub Minneapolis
St. Croix
Wright
Sherburne Isanti
Chisago
Anoka
Hennepin
Carver
Scott Dakota
Ramsey
Washington
Minnesota
Wisconsin
Counties within the circle make up the trading area, all participating retailer stores
falling within those counties make up the data reported for Cub Minneapolis
Slide 33
________________________________________CUB TWIN CITIES TRADING AREA________________________________________________
|
Supermarket Composition and | Claritas Estimates
NSUS Sample Representation | as of January 1,2003
as of Jan04 | % US
Number NSUS | TOTAL POPULATION 3,021,600 1.1%
Over Sample | TOTAL HOUSEHOLDS 1,161,800 1.1%
$2MM Cooperation | EFFECTIVE BUYING INCOME($000) 73,989,445 1.3%
|____________________________________________________________________
Major Retail Chains |
CUB FOODS 48 YES | ACNielsen Type Food Stores
RAINBOW (ROUNDY'S) 31 YES | ACNielsen Control Estimates
BYERLYS 11 NO | as of December 31,2001
| Number % US ACV ($000) % US
| TOTAL FOOD STORES 881 0.5% $ 5,124,729 1.1%
|
Wholesaler Representation | STORES $4MM AND OVER 214 4,569,714
SUPERVALU YES | STORES $2MM AND OVER 252 4,679,638
NASH FINCH YES |____________________________________________________________________
|
| Market by County
Wholesaler Information from | ANOKA MN CARVER MN CHISAGO MN DAKOTA MN
Trade Dimensions' Store File | HENNEPIN MN ISANTI MN RAMSEY MN SCOTT MN
| SHERBURNE MN WASHINGTON MN WRIGHT MN ST CROIX WI
|
|
| COPYRIGHT 2004 A.C. NIELSEN COMPANY 01/23/04
Comp Market data is composed of the Major Retail Chains that
cooperate in the sample in these counties. They include only Rainbow
and Cub Foods for the Minneapolis Cub Comp Market
Slide 45

Products

Slide 46
Product Overview
Industry Subtotals
Heinz defined aggregates based on how company views the category
Only available on custom databases
Hierarchy
Nielsen defined department, category and brand aggregates across the
grocery store
Only available on Strategic Planner
Characteristics
Ability to filter through all database UPCs based on unique characteristics
of products
Ex: size, flavor, meat type, container type
Characteristic availability differs by category
Uses: UPC level output, need to create custom aggregates based on
product characteristics when not available via Industry Subtotals
Available on all databases
Slide 47

Facts

Slide 48
There are a tremendous number
of facts
The difference between similar
facts is important
The application drives the
correct choice of fact
There is never any one correct
fact
There is always a best fact for
the specific application in
question
Why is it important to understand
facts?
Slide 49
Analytical Thinking

Certain mathematical tools
and calculations can be very
helpful, but...

knowing how to use them,
more so than actually
deriving them, is most
important.
Slide 50
Numbers tell you little by
themselves.
Usually you look at
numbers in terms of other
reference points
Or you combine them with
other information to form a
conclusion, answer
questions, set objectives,
make plans, etc.
So, What Do I Do With the Numbers?
Slide 51
Analysis Tip The Analytic Path
Most issues can be addressed by drilling down this path
Issue
Base Volume Incremental Volume
Distribution Velocity
% ACV
(Breadth)
# of Items
(Depth)
Base Price
Competitive
Activity
Other Factors
Promotion
Support
(Quantity)
Promotion
Effectiveness
(Quality)
Level of
Support
Promo Mix
Promo Price
Price Discount
Competitive Activity
Slide 52
Analysis Tip Prioritize Key Issues
To set up a logical flow and to avoid analysis paralysis,
start with the higher level trends then work into the
individual drivers
Level of Detail
Category
. Segments
Manufacturers
Competitive Brands
Your Brand

Distribution
Everyday
Pricing
Trade
Support
Discount
Total Volume
Trends
Base
vs

Incremen
tal
Base
&
Increme
ntal
Drivers
Recommended Level
of Detail
Dependent upon
level of chg
Slide 53
Volume and Share
Slide 54
Sales Volume
Measures the amount of product sold over a given time
period

Sales Dollars Dollar value of total sales
Sales Units Total package sales
Equivalent Unit Sales Total sales on an equivalized
basis (pounds, cases, servings, etc.)

Uses
Tracking
Ranking
Share calculations
Show a brands importance to the category
Slide 55
Share
Measures the % of sales
that a product accounts
for

Influenced by two different
measures
Brand Sales and
Category Sales
Slide 56
What do the following sales
scenarios have in common?
Brand sales flat, category
declines
Brand sales up, category
flat
Brand sales up a lot,
category up a little
Share Activity
Slide 57
When to Use Volume and Share
When concerned with Use
Absolute volume;
Absolute volume change
Unit, Dollar, Eq Sales
volume
Comparing performance relative to the
category or segment
Unit, Dollar, Eq Share
Relating volume to profit;
Comparing across different categories
Dollar Sales
Controlling for disparate package sizes Equivalized Sales
Absolute item movement;
Comparing sales to shipments
Unit Sales
Slide 58
Analyzing category growth in a retailer or channel that is growing
significantly.
Example: Category B grew 16% in Kroger last year. However, since
Kroger grew its total $ sales by 22%, Category B is not keeping pace
with its potential growth in Kroger.
ACV growth /
Total $ Ring
Growth

Analyzing mature categories that have not seen significant innovation
Examples: Categories that are considered staple items. If population
is growing at 3% a year, a staple category should see growth just by
maintaining its penetration and buying rate.
Population
Growth
Evaluating categories that have restricted shelf space
Examples: Frozen departments, Checkout-aisle racks, coolers
Department
Growth
Macro consumer trends affecting your category and related categories
Examples: Categories affected by Low Carb diets, Convenience,
Trans-fats
Equivalized
Sales
When To Use Volume Benchmarks
Use Benchmarks to compare category and brand
trends
Slide 59
Different Ways to Look at Volume
TOTAL VOLUME
+
Promoted
Volume
Non-Promoted
Volume
+
Baseline
Volume
Incremental
Volume
Slide 60
The Benefits of Identifying Promoted Vs.
Non-Promoted Volume
Provides an indication of what percent of a brands
volume came from stores with a promotion.

Provides an indication of what percent of a
manufacturers deal was passed on to the consumer by
the retailer.

Retailers trade promotion execution can be observed.
Slide 61
Analysis Tip Promoted Volume
Promoted volume is useful for determining
how deal reliant a brand is

Interpretation:
Our brand receives a higher share of category promoted volume compared to its
share of sales
Our competitors promoted volume share is under-indexed relative to its market share
Brand Share Trend
17.5
13.1
19.7
11.2
Our Brand Competitive Brand
Total Volume Share Promoted Volume Share
Slide 62
Baseline Volume
Normal expected everyday sales in the absence of any
store-level promotion

A statistically calculated measure NOT adjusted for FSIs,
print, TV and market-level affects

Uses
Track the underlying health of a brand and compare it
to its competition
Analyze merchandising effectiveness in conjunction
with incremental volume
Slide 63
Baseline Calculation
week 1 week 2 week 3 week 4 week 5
170
Unit Sales
75 75 75 75
Display
Week
Slide 64
Baseline Calculation
170
Unit Sales
75 75 75 75
In Week 4 Baseline estimate would be
75 units based on pre and post week
sales
75
Display
Week
Slide 65
Baseline Volume Includes Marketplace
Conditions that Affect Sales of a Product
0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
Category
Trends
Long-Term
Seasonality
Market-Level
Effects
Brand
Trends
Baseline
Slide 66
Total volume below
baseline
Competitive activity
Out of stock
Seasonal/holiday
Total volume above
baseline
Promotions or advertising not
captured by regular means
Market-level influences (e.g.,
battery sales during a
hurricane in Miami)
Reasons for Total/Baseline Volume
Differences
Slide 67
Incremental Volume
Represents the additional
predicted volume that results
from in-store promotion

Calculation:
Total Actual Volume -
Baseline Volume =
Incremental Volume
Slide 68
Incremental Volume
Unit Sales
In Week 4 Incremental volume
would be 95 units
170
75
Display
Week
95
75 75 75 75
Slide 69
How Can Incremental Volume Be Negative?
If actual sales are less than expected sales
Out-of-stocks
Unit Sales
75 75
75
75
Actual sales are below
estimated Base Incremental
is negative 15 units
75
170
60
Slide 70
Analysis Tip - Base and Incremental Volume
Category Volume Trend
Current 12 Weeks vs. Year Ago
(25,000)
(12,500)
0
12,500
25,000
37,500
Total FDM ex
WM
Food Drug Target K-Mart
Total EQ Base EQ Incr EQ

Interpretation:
For the Food and Drug channels, an increase in Incremental EQ volume is not enough
to offset a decline in Base EQ volume.
Target is showing significant growth, driven by both base and incremental volume.
Identifying whether a volume change is coming primarily from
base or incremental volume is a good way to start an analysis
Slide 71
Analysis Tip - Base and Incremental Volume
Base and Incremental trends will determine potential
strategies
Slide 72
Base Volume = Non-Promoted Volume
Base vs. Non-Promoted
Base volume estimates sales in all stores
Non-Promoted volume is measured only in stores that
did not run a promotion
Subset of stores

Incremental vs. Promoted
Incremental volume estimates additional sales due to
promotions
Volume sold above the base
Promoted volume measures all volume sold on deal
Incremental Volume = Promoted Volume
Slide 73
Understanding the underlying health and
trends of a brand
Baseline Volume
Measuring the effectiveness and efficiency of
trade promotions
Incremental Volume
Quantifying the importance of promotional
activity to a brand
Promoted Volume
Quantifying the amount of volume sold in
stores that did not provide trade support
Non-Promoted Volume

When to Use Base, Incremental, Promoted,
Non-Promoted Volume
Slide 74
Sales Volume is influenced by
Seasonality
Consumers value certain
products more (or less) during
the year.

Examples of seasonality
Holidays or event driven: 4th of July,
Thanksgiving, Cinco de Mayo, Back
to School, etc.
Seasonal: BBQ sauce and ice cream
during the summer or soup and
crackers in the winter
Slide 75
Seasonality Calculation
1. Divide annual base volume by 52 to get expected weekly sales
(in the absence of seasonality and promotion).

2. Divide actual base weekly volume by expected weekly sales
(just calculated in step 1) to derive a seasonality index
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Slide 76
Analysis Tips - Seasonality
Use Base Volume when calculating seasonality to negate
promotion-driven volume spikes
Be careful of moving holidays and market level effects
In a category that has encountered a lot of activity 2 years
of history should be used
Compare versus the year-ago period rather than a prior
period
For categories with extreme seasonality look at on
season versus off season periods
Slide 77
ACV Distribution and Velocity
Slide 78
Velocity
Baseline Volume
Distribution
Base Price
Seasonality
*Advertising Support
*Manuf. Coupons/FSIs
*Brand Awareness/Image
*Product Quality
*Weather
*Consumer Promotions
*Sampling
Competitive:
Distribution
Price
Merchandising
*Advertising
*Coupons
% ACV
(Breadth)
# of Items
Carried
(Depth)
* Non-Nielsen measures

Baseline sales can be impacted by different market factors.
Understanding the Whys to Changes in
Baseline Volume
Slide 79
How Is
Distribution
Measured?
Slide 80
ACV Distribution
ACV Distribution is a measure of
a products availability

Can be measured in terms of
breadth and depth
Breadth: percent of All
Commodity Volume that carries
your brand
Depth: number skus that are
carried in the stores that sell
your brand

Slide 81
What is Distribution?
Distribution is the measure of the availability of a product.
For an individual item, distribution depends on two basic
variables:
How many stores stock the item?
How large are those stores?
Slide 82
All Commodity Volume $ (ACV)
An individual stores/markets ACV is the dollar volume of
everything the store sold during a periodall the
merchandise that passed over the scanner (or was rung
on the register)
The sum of the ACVs of all the stores within a given
channel is the ACV for the channel. Likewise, the sum of
the ACVs for all the stores in a market is the ACV for the
market (Market ACV $ fact on database)
Slide 83
The 7 Food Stores
In This Market Sell
$300,000 Per Week

JONESs
D) $36,000 (12%)
JONESs
A) $60,000 (20%)
SMITHs
B) $48,000 (16%)
SMITHs
C) $48,000 (16%)
SMITHs
A) $36,000 (12%)
JONESs
B) $36,000 (12%)
JONESs
C) $36,000 (12%)
SMITHs Grocery Chain
* Has 3 stores in the market
doing $132,000 per week
for a total of 44% of the ACV
JONESs Grocery Chain
* Has 4 stores in the market
doing $168,000 per week
for a total of 56% of the ACV
All Commodity Volume $ (ACV) Explanation
Slide 84
If These 3 Stores
Sold Your
Product This Week,
What Would The
%ACV Be?

JONESs
A) $60,000 (20%)
SMITHs
C) $48,000 (16%)
SMITHs
B) $36,000 (12%)
JONESs
B) $36,000 (12%)
SMITHs
B) $48,000 (16%)
JONESs
D) $36,000 (12%)
JONESs
B) $36,000 (12%)
Slide 85
JONESs
D) $36,000 (12%)
SMITHs
B) $48,000 (16%)
JONESs
A) $60,000 (20%)
ANSWER:

20% ACV +
16% ACV +
12% ACV = 48% ACV
Slide 86
Breadth of Distribution -- % ACV

% ACV Selling serves as a good weighting factor when
measuring distribution.
All stores are not created equal
Higher ACV stores serve more consumers
A measure of breadth, or reach, indicates how
many consumers have the opportunity to buy the
product
Slide 87
% ACV Selling is NOT Distribution
Real on-shelf distribution is
almost always higher
Most products do not
sell in every store every
week
Out-of-stocks can
happen
One other point to remember
Just because an item is authorized
at Chain Headquarters does not
mean that every store actually
stocks it.
Slide 88
Analysis Tip - % ACV Selling
Brand A
Sales
Week
1
Week
2
Week
3
Week
4
4-Week
Total
Store A
(40% ACV)
X X
Store B
(35% ACV)
X X X X
Store C
(25% ACV)
X X X
Total 40% 60% 60% 35% 100%
Average Weekly % ACV = 48%
Use longer timeframes to get the
best picture of distribution
Use 4 Wk
Periods only!
Slide 89
Analysis Tip - % ACV Selling
In most cases, use the latest period when analyzing %
ACV Selling

% ACV Selling
75
70
55
67
4 wks ending
Apr
4 wks ending
May
4 wks ending
Jun
Latest 12 wks
AVG
Represents the current state of the business
Averaging longer time periods may mask more recent trends

Slide 90
Depth of Distribution

Depth assesses the variety of different items
being sold

Cumulative Distribution Points (CDP) or Total
Distribution Points (TDP)
Measures both the number and size of stores that
carry your brand and the number of sku's each store
carries

Average Number of Items Handled
On average, the number of sku's carried in the
stores that sell your brand
Use 4 Wk
Periods only!
Slide 91
Cumulative Distribution Points (CDP)
Also called Total Distribution Points (TDP)
Calculated by adding the %ACV of each individual sku
%ACV CDP
BRAND X 98% 295
Flavor 1 95% 95
Flavor 2 90% 90
Flavor 3 80% 80
Flavor 4 30% 30

}
Sum =295
Use 4 Wk
Periods only!
Slide 92
Difference from %ACV
CDP shows us that while Brand A and Brand B are both
sold in 100% of the stores in this market, Brand A has
more items available in each of the stores.
% ACV CDP

Brand A 100% 2100
Brand B 100% 990
%ACV tells us
breadth of
distribution

CDP tells us
depth of
distribution
Slide 93
Average Number of Items Handled
Dividing Cumulative Distribution Points by %ACV gives
the Average Number of UPC's Carried within those stores
selling the brand.
The average store in this market carries 21 upcs of
Brand A.
AVG #
% ACV CDP Items
Brand A 100% 2100 21.0
Brand B 100% 990 9.9
Use 4 Wk
Periods only!
Slide 94
Analysis Tip Average Number of Items
Handled
Use Average Number of Items Handled to compute a
Fair Share index comparing share of items to share of
sales
AVG #
Items
Share of
Items
Share of
Sales
Fair Share
Index
Category 57.5 100.0 100.0
Brand A 21.0 36.5 31.0 117
Brand B 9.9 17.2 27.0 64
Interpretation: Brand Bs share of items is underdeveloped
relative to its share of sales. Potential to add additional Brand
B items to the shelf
Slide 95
Analysis Tip Cumulative Distribution Points
CDPs may explain volume changes that might not be
seen when looking at % ACV
690 685
693
658
609
584
100 100 100 100 100 100
1 2 3 4 5 6
Period
Distribution Points % ACV
Interpretation; The brands base sales began eroding in period 4,
yet % ACV remained at 100%. However, depth of distribution
declined as the brand lost the equivalent of one item.
Slide 96
Breadth of distribution the
number of stores carrying
your product
% ACV Selling
Trending overall depth or
quality of distribution over
time
Cumulative Distribution
Points;
Total Distribution Points
How many skus are carried
in stores that sell your brand;
Fair Share Analysis
comparing share of shelf to
share of sales
Average Number of Items
Handled
When To Use - ACV facts
Slide 97
Velocity
Measures brand strength while controlling for
distribution

Sales Per Million ACV
Average sales of a product for every million dollars of
ACV that is scanned
Comparisons across and within markets

Sales Per Point
Average sales of a product for every percentage point
of ACV distribution
Comparisons within markets only
Slide 98
Uses of Velocity
Marketing
Is my growth distribution driven or velocity driven?
Velocity driven growth can be long term,
signaling consumers like your product and are
buying more.
Distribution driven growth can be limited
because soon you will run out of new stores to
carry your product.
Sales
Prove your product sells faster than the competition
and deserves shelf space.
Slide 99
Analysis Tips - Velocity
When comparing brands with differing numbers of UPC's,
use Sales Per Cumulative Points of Distribution
Divide sales by CDP
Brands with a greater number of UPC's will tend to
have stronger turns as more items contribute to overall
sales

Use caution when tracking Sales Per Point of Distribution
for a new product
Distribution will be growing as the product gains
distribution in new retailers and markets, resulting in
fluctuating turns
Slide 100
Comparison of CDI and BDI identifies product
opportunity or vulnerability by geographic area.
Category Development Index
Category volume indexed to the population index
in relation to the United states norm. (TTL US =
100)

Brand Development Index
Brand volume indexed to the population index in
relation to the United states norm. (TTL US =
100)

CDI/BDI MEASURES
Slide 101
% of Total U.S. Population in Chicago: 7%
% of Total U.S. Brand A $ Sales in Chicago: 13%

% of Sales: 13%
% of Population: 7% = 1.86, then multiply by 100 to derive an index = 186

This means that for every person in Chicago, Brand A $
sales are almost twice as important as the average market.

CDI/BDI MEASURES
Population Development IndexThe importance of
product sales compared to the importance of the population
in a market.
How to calculate a Development index...
Slide 102
Analysis Tip CDI/BDI
Use CDI/BDIs to prioritize market opportunities
Slide 103
Analysis Tip CDI/BDI
Calculate an Opportunity Index to further prioritize
markets

CDI

BDI
Oppy
Index
Chicago 106 95 112
Indianapolis 159 116 137
How to calculate an Opportunity index...
CDI
BDI

X 100 = Opportunity Index

InterpretationThe brand has a larger opportunity gap in
Indianapolis even though both the category and brand indices are
above 100, compared to Chicago where the category is over 100
and the brand is under 100

Slide 104
Promotion, Promotion Effectiveness
and Pricing
Slide 105
Understanding the Whys to Changes in
Incremental Volume
Incremental sales can be impacted by different
merchandising factors.
Promotion Support
(Quantity
Incremental Volume
Promotion Effectiveness
(Quality)
Level of Support
Promotion Mix
Level of Price Discount
Competitive Conditions in
Promoting Stores
Promotion Price
Use 1 Wk
Periods only!
Slide 106
Week 1 Week 2 Week 3 Week 4 Week 5 Week 6
Sales
What could cause this spike in sales?
Promotions
Slide 107
Promotion Types
Temporary Price Reductions (TPR)
A 5% discount (or more) off a
product's regular price

Features
Print ad placed by the retailer
used to promote a specific
product

Displays
Temporary secondary stocking
location for a product
Nielsen measures three types of trade promotions
Slide 108
Features
Features are retailer print advertisements or other special
printed promotions:
Ads inserted in Newspapers
Store Flyers / Circulars

Nielsen Feature Coders collect and classify all retailer
features from the entire Nielsen store sample.

The features are classified into A, B, C or Coupon Ads,
based on the size of the ad

FSIs (Free Standing Inserts) are excluded since they are
manufacturer promotions
Slide 109
Displays
Information collected for all Nielsen sample stores every
week

Three conditions to be considered a display:
Temporary secondary location
Special effort by the retailer to attract attention and to
boost sales of the item
Contain actual merchandise accessible to the
customer.

Slide 110
Temporary Price Decrease (TPR)
Consists of those Stores/Weeks where a Price Decrease
of at Least 5% is present, but no Feature Ad, Coupon Ad
or Display accompanies the Price Decrease (TPR)

Lower price becomes new base price after 7 weeks
Slide 111
Promotion Conditions
Promotional
Conditions are
mutually exclusive at
the UPC level. A UPC is
either Promoted or Not
Promoted.
Price
Decrease
(TPR)
Feature
w/out
Display
Display
w/out
Feature
F&D
Slide 112
Promotion Support
% ACV Promoted
% of ACV that sold at least one unit on deal during the
time period

Store Weeks of Support
Number of weeks a product is on deal weighted by the
ACV of the stores participating in the promotion

% Base Support
How much of a brand's everyday business (baseline
volume) is exposed to a deal

Three ways to view Quantity of trade support
Use 1 Wk
Periods only!
Slide 113
% ACV Support
How much support did I receive on this event?
How much of each type of support was received?
Did the retailer execute as agreed to?
Did the sales force or broker support and/or merchandise
the promotion as required?
Measures the amount of consumer traffic
exposed to a promotion
Use 1 Wk
Periods only!
Slide 114
Store Weeks Support
Measures the quantity of weeks the brand was on
promotion
Actual %
ACV ANY DSP
Week 1 20%
Week 2 100%
Week 3 60%
Week 4 30%
Week 5 50%
260% /100 = 2.6 weeks
Interpretation - Brand received the equivalent of 2.6 weeks of
Display activity in the five-week period
Slide 115
% Base Support
Weights the importance of the store to the brand.
Gives more credit for an important SKU
Is additive/combinable across markets, time, products
and retail conditions
Measures the % of Base business exposed to
a particular promotion type
Slide 116
% Base Support Calculation Example
Base Sales Promotion?
Store 1 10 No
Store 2 10 Feature
Store 3 25 Feature
Store 4 20 No
Store 5 15 Feature
Total Base Volume = 80
Feature Base Volume = 50
% Base Support = 50/80 = 63%
Interpretation 63% of the brands base volume was exposed to
a feature during the promotion period
Slide 117
Level of trade participation in an
event;
Amount of consumer traffic
exposed to promotions
% ACV Support
Duration of support Store Weeks Support;
Cume Weighted Weeks
How much of a brands base
volume was exposed to a
promotion
% Base Support
When To Use Promotion Support facts
Slide 118
Measures how much incremental volume each
promotion generated

Percent Lift
Promotion Effectiveness Index (PEI)
Incremental Weeks
Efficiency
Slide 119
Promoted Baseline Volume
Promoted
Non-
Promoted
Incremental
Base Non-Promoted
Base
Promoted Base
Incremental
that is a result
of promotion
Also Known
as
Subsidized
Base
Slide 120
Promoted Baseline Volume
In Week 4 all the volume is
promoted, but only 95 units
are incremental; 75 units
are subsidized base
170
Unit Sales
75 75 75 75
75
Display
Week
95
Slide 121
Promotion Efficiency
Percent of promoted sales that were incremental

Tells how efficient was the promotion
What percent was incremental to baseline?
What percent was subsidized?

Note: The more subsidized volume that is generated
during a promotion the less efficient that promotion will
be!
Incremental Sales
Promoted Sales
x100
Slide 122
Promotion Effectiveness Index (PEI)
Indexes Total volume to Base volume

% Lift
Similar to PEI but expressed as a
percentage

Incremental Weeks
Similar to Lift but expressed as a number
of weeks
Measures how much incremental volume each
promotion generated
Promoted Sales
Promoted Base Sales
x 100
Promoted Sales
Promoted Base Sales
- 1
Promoted Sales
Promoted Base Sales
x 100 - 100
Slide 123
Analysis Tips - Interpreting Promotion
Response
PEI
Sales indexed at 227 vs. base
during the promotion week

% Lift
The promotion drove a
127% increase in sales

Incremental Weeks
The promotion generated
1.3 additional weeks of sales

56% of the promoted volume
was incremental to the brand
170
170
75
x 100 - 100 = 127%
170
75
- 1 = 1.27
week 4
75
Display
Week
95
95
170
x 100 = 56%
170
75
x 100 = 227
Slide 124
Analysis Tips Promotion Effectiveness
Promotions will yield different results depending on:
Type of merchandising occurring in the store - ads,
displays, TPR's
Depth of discount offered to consumers

When reviewing promotion effectiveness, take into
account the size of the brand
Smaller players, with small base businesses, have a
much easier time generating big lifts
Slide 125
Measuring the increase in volume
due to promotions;
Determining which promotions
generate the largest incremental
gains
% Lift;
Promotion
Effectiveness Index
(PEI);
Incremental Weeks
Measuring the ability of a
promotion to minimize subsidizing
existing volume
When to Use Promotion Effectiveness Facts
Slide 126
Pricing
Nielsen databases track pricing in four ways:

Average Retail Price
Weighted price of a product, representing both non-
promoted and promoted prices

Non-Promo Price
Average scanned price of a product in stores where
there was no promotion

Any Promo Price
Average scanned price of a product in stores where
there was a promotion

Base Price
Estimate of the normal, non-discounted price of a
product in a store
Slide 127
Base Price = Non-Promoted Price
Non Promoted Price is
based solely on stores
where the item in not being
promoted

Base Price is based on all
stores, not just non-
promoted stores

Slide 128
Price Discount
Measures the difference
between Base Price and
Promoted Price

The deeper the price
discount the greater the
expectation that consumer
sales will increase

Slide 129
Average Retail Price - Precautions
Think when you average across:
Products: (10, 26 and 51 oz. sizes)
Markets: (Los Angeles vs. Boston)
Promotions (display price vs. feature price)

Aggregate price is one big average beware!!!
$2.99 =Average of $1.99 & $3.99
$2.99=Average of $0.99 & $4.99
$2.99=Average of $2.98 & $3.00

Slide 130
Analysis Tips - Pricing
Analyze price at the SKU level
Prices at the brand level are an average of all sizes and
multi-pack counts

Match like items when comparing price to competition
Select similar-sized competitive items for comparison
Or use equivalized price

Use the most recent period to measure base price
Longer timeframes may mask recent trends
Slide 131
When to use Pricing Facts
What consumer is paying on average Average Retail
Price
What is the average price for an item
when not on promotion
No Promo Price
What the consumer is paying on
promotion/deal
Any Promo Price
Tracking price trends;
Impact of price on baseline volume
Base Price
Magnitude of savings passed on to
the consumer
% Price Discount
Slide 132
Analysis Tips - Recommendations
If Volume Change is
driven by:
Potential Actions
An increase in Base
Price
Increase perceived value of product
Decrease price
Increase package size
Increase use of bonus packs, special packs
Launch a product or package innovation
Improve communication of product benefits
Improve product quality
A decrease in Base
Velocity
Improve advertising
Weight, Target, Message, Media
Improve consumer promotion
Frequency, Values, Types
Increase shelf presence, change item mix
A decrease in %ACV
If base velocity is competitive with brands on the shelf, conduct a
distribution drive
If base velocity is low, improve velocity (see point above) to justify
increased distribution
A decrease in Average
Items Carried
Introduce new products
Change item mix
Address any Out-of-Stock issues
Slide 133
Analysis Tips - Recommendations
If Volume Change is
driven by:
Potential Actions
An increase in Promoted
Price
Reduce promoted price
Implement a price multiples strategy (e.g. 2 for $5)
A decrease in the %ACV
with Quality
Merchandising
Increase number of stores with features or displays
Determine which promotion condition works best for each
brand / segment
Improve event timing / frequency
A decrease in the # of
Promoted Items
Identify targets for number of items on feature or display
Provide consumer incentives for purchase of multiple items

A decrease in Promoted
Velocity
Coordinate & integrate trade promotion with other mix elements
(e.g., advertising, coupons, consumer events)
Identify stronger items for promotion
Develop promotion themes
A decrease in Promotion
Efficiency
Improve Customer Targeting (loyals vs. switchers)

Slide 134
Wrap Up

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