I have written extensively about the underlying product information challenges facing the companies attempting to inform consumers about eating more healthy through simplified labeling. Some of the providers (Guiding Stars, ONQI/NuVal and others) have reverted to collecting their own product label information directly from the store shelves due to the inadequacy of commercially available data. This approach too, given the designs of those programs will end up failing. The newest solution on the block, points out some additional product information challenges that may lurk even if the program or commercial suppliers of product data were to successfully tackle the data collection accuracy issues.
eatingsafe.com is what I believe to be the first of the H&W 3.0 applications. The company has been in business in Australia and just now coming to the States. (more…)
In an early June rant, I gave my impressions of the recent FMI show. I thought the show represented the changes in collaborative leadership that are beginning to emerge in the CPG and Retail Industries. Clearly both FMI and GMA are in a state of flux about their direction and about the issues in which they wish to be involved.
There seem to be 6 big movements inviting, tugging at the fabric of the industry. Within that 8-10 organizations or consortium are trying to lead the industry or at least parts of it, in those 6 directions. All of the movements address important issues. Clearly no one change will “win”. Some combination of these will, after vying for senior management support (read budget), take hold while others may fall by the wayside.
The 6 big movements as I see them:
1. P.R.I.S.M. This recognizes the power of the store as a brand-building advertising vehicle. This has some very powerful support by manufacturers and retailers alike. There is also enthusiastic encouragement by industries who would install and service the advertising components. The movement has clear appeal….after all where better to try to influence consumer purchase than while they are in “buy mode” at the place of purchase. The movement also has some infrastructural support as Nielsen has agreed to measure traffic and “convert” it to metrics common to alternative mass media. The movement is fraught with both potential and possible hurdles….. which include fundamentally opposing views of consumer reaction. Manufacturers and retailers hope the consumer is “captive” and will therefore see the new vehicles. The consumer seems most interested in getting through the store quickly, and may have other ideas. If the industry is correct billions of advertising dollars could easily flow out of traditional media and into the stores. Some of those dollars might well come from the retailer’s promotion vehicles such as their circular. Also the increased visibility into the store might well bring into view promotion non performance which could cause as many dollars to leave the retail network as come in on the advertising front.
2. Health and Wellness. Perhaps the most pervasive potential change that the industry could exploit. It is an opportunity to both tie consumers closer in loyalty to a particular banner and offer successful retailers and their supporting manufacturers the ability to “play” in a second enormous market…health/wellness - care. The consumers are very enthusiastic about this leadership role for their grocer. Combinations of organizations such as Harvard and Topco offer the ONQI service, the Delhaize Group is offering their version, Guiding Stars,and there are dozens of other efforts, most not quite as sophisticated. From my perspective the most well thought out approach (although perhaps the approach most difficult to understand) is provided by Bill Bishop and the Institute of the Future. This movement also offers challenges in that the quality of the basic product data required to offer consumers clear guidance is out of date and inaccurate (as is all product data in this industry). The inability of industry players to deal with this issue broadly will cause this movement and grocers great harm. (more…)
by: John Pryslak, Prime Consulting
While current, accurate and complete product information data is the foundation of any Health & Wellness program, any competitive advantage is NOT contained in the data itself, but rather in how the program (Guiding Stars, ONQI etc.) is designed and communicated to the consumer.
That said, a lack of current, accurate and complete product information data will be the Achilles heel for a retailer’s Health & Wellness program. Imagine a program where individual products are rated against a defined and proprietary set of nutritional criteria and assigned a rating based on how good they are for you (not TOO hard to imagine since several such programs are already in place). The overall nutritional worth of any item is communicated through a shelf tag that essentially tells the consumer if a product is “safe” to eat, or if they should consult their doctor before ingesting.
The health and wellness effort represents an altruistic endeavor on the part of a retailer to help consumers purchase the most nutritionally dense foods for their money. Unfortunately, the reality that underlies this system is flawed since most of the available data used for these systems is not designed for Health & Wellness in general much less any single rating scale.
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3 events this week prompt yet another commentary on the risks of using CPG product information in its current state.
- A conversation with a colleague from a large grocery chain. They were talking about populating their emerging PIM/MDM systems with product information for a variety of applications across functional silos. When asked “with what will you populate this new system” the answer was “we will simply expect to get product information from the GDSN.”
- A fourth announced (with many yet to be announced) product rating system for health and wellness. This one from a shelf tag supplier who has hired a nutritionist and assembled some product data from various sources.
- Additional clarification from two retailers on their expectations for product ratings using the Overall Nutritional Quality Index (ONQI).
Precise, all-inclusive, up-to-date and homogeneous product data is a prerequisite for any frictionless inter or intra company business activities that concern products. This includes supply chain, demand chain and customer facing applications. Health and Wellness rating programs are the latest, but perhaps the most serious of these applications from a product data dependency point of view. Consumers are depending on their supermarkets to give them the straight scoop, the supermarkets are depending on the rating guru’s….and the guru’s are depending on the available product information.
The current state of product data collection (DIY and databases collected by third parties) were simply not designed to be precise, all-inclusive, up-to-date and homogeneous. They will not support uses such as Health and Wellness programs, as our studies have shown. Prime Consulting and I have studied this as have others (see “Its the data stupid” post on 1/3 below with its link to the original author at GXS) and have a pretty good approximation of just how much of the available data is of sufficient quality to be useful. If the product information is wrong, dated, incomplete or not correctly converted, the ratings will be wrong and the advice to the consumer will be wrong. GIGO lives!
More importantly we have identified the four primary areas in the current product introduction/revision process where information quality leakage occurs. Doug from Prime and I will co-author a blog on these four soon.
The swirl of Health and Wellness activity continues to dominate the news in the grocery and food trade-rags, websites, blogs and even some consumer publications. This makes sense given both the real importance of helping the shopper simplify their grocery selection process and the quiet targeting of food manufacturers and retailers that is going on in both government and tort-lawyer back-rooms across the country.
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Great post on the GXS blog site by Melanie Ligons on 12/17/07 (link below).
Essentially she predicts/hopes that “leading companies will step up to the plate in 2008 and address the CPG product data quality issues by taking the first steps toward implementing solid B2B Data Management programs.”
She has correctly nailed an issue that is fundamental to our times. Poor CPG product data has plagued the industry for years. The industry has made some assumptions that:
- Manufacturers have near perfect product information and have an obligation to keep it perfect
- Manufacturers have product information that they can and should share with their customers
What we now know and are beginning to admit to ourselves and our customers, is that according to Ms. Ligons: “information integrity issues associated with products …reduce the ability (I would argue, preclude the ability) of an organization to make appropriate short and long term decisions. ….companies are realizing that the data they’ve been keeping is flawed, and so is the data they are using to run their business on a day to day basis.” Further, “sharing data isn’t the issue. Making sure companies have accurate data, and then keeping it that way is the real challenge.” (more…)
There have been two major announcements about Healthy Eating programs this week offered by grocers and by a combination ofacademics and grocers. One by Yale and Topco, a service bureau for such companies as Price Chopper, Food City, Giant Eagle, Bashes, Harris Teeter, Meijer and others. The second is Delhaize, owner of Hannaford, Food Lion, and Sweet Bay in the U.S. Many other groups are working on similar efforts (more…)
