Challenges in keeping online product data current. Corporate website, 30% social media 27% Friends, personal. Market research. Digital promotions

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1 CUSTOM RESEARCH by kara romanow Current and Consistent Product Data Critical for B2B and B2C E-Commerce Where do consumers get information about your products? Corporate website, 32% social media Challenges in keeping online product data current Lack of internal resources to create, host, maintain Pace of updates Sheer volume of platforms Lack of internal resources to distribute content externally 45% 43% 57% expert perspective By Susan Sentell, CEO and President, Gladson Excellence in Engagement and Execution Is Driven by Consistent Information Master data management has always been an important underlying foundation for B2B e-commerce, but as consumers move online, it is even more critical that branded product data is complete, consistent, and accurate across all platforms to support B2C e-commerce as well. This month, CGT partners with Gladson to take a look at how consumer goods (CG) manufacturers are managing item data and where that information is most needed to meet consumer and retailer demand. CG companies believe that consumers look to three primary sources for product data: brand websites, word of mouth, and retail websites (websites include corporate sites as well as social media). We expected smaller companies to rely on word of mouth more than their larger counterparts, which they do, but the difference was less than 10 percentage points. With the reliance on online data sources by consumers, organizations are challenged to keep product content current. Lack of internal resources to maintain item data is the top challenge cited by 57 percent, followed by the pace of updates at 45 percent and the sheer volume of updates at 43 percent. One of the ways manufacturers are creating a more engaging online shopping experience is by providing additional product content on corporate and retail websites. Interestingly, considering the rise of direct to consumer and retail shopping platforms, more data is available on brand websites than on retail sites. This is especially true for 63 percent of companies over $10 billion in revenue who only provide more product images on their own sites. Brand owners are striving to better engage shoppers, and the top initiative to meet that goal involves retailer collaboration. In fact, 38 percent of those surveyed believe increased collaboration with retailers will help better engage shoppers and that number jumps to 63 percent for companies over $10 billion in revenue. Several initiatives are being implemented in partnership with retail customers to improve the customer experience, and all are fairly close in priority. Market research is slightly ahead at exactly half our respondents, but the other four projects are within 3 percentage points of each other and include digital promotions, improved planogram compliance, store specific assortments and store optimization. Lastly, we asked about the current and future use of virtual reality to enhance shopper experiences at retail. We found a large discrepancy by company size, with 88 percent of companies over $10 billion likely to use virtual reality, while smaller companies are not planning on leveraging the technology. As benefits emerge, we expect the use to become more widespread in companies of all size Friends, personal 30% social media Retail websites Newspapers/ 05% magazines Traditional 04% advertising Third parties 02% (ie: bloggers) 38% believe increased collaboration with retailers will help better engage shoppers that number jumps to 63% for companies over $10 billion. Visit consumergoods.com to download the full research report. Lack of a single repository for product content 25% Multiple responses permitted What types of enhanced online content do you provide? Multiple responses permitted Digital coupons 61% 57% 49% 54%47% 40% 36% 28% 30% 30% More product images, views Value added content (recipes, product reviews) Expanded product details Which key initiatives are you partnering with retailers to deliver better customer experience? Market research Digital promotions Improve planogram compliance, shelf availability Store specific assortments Store optimization Corporate website Retail partners website 41% 41% 44% 44% 50% Video Large companies over $10B provide additional product images on their own websites BUT NONE do on retail partners websites. As the shoppers path to purchase has become dynamic and circuitous in nature, predicting how, when and where a shopper will engage with a brand is unpredictable, at best. But what we do know is that consumers expectations for brands involve getting what they want, when they want it. That expectation doesn t change based on where the interaction takes place; shoppers expect brands to meet their needs both in stores and online. While there s no magic formula for delivering the ideal brand experience across all touch points to all shoppers at all times, one fact remains: operating off a consistent base of product information can dramatically increase a brand s ability to meet and exceed shoppers expectations. When a CG manufacturer leverages a consistent foundation of product information for all B2C and B2B processes, it puts itself, and its trading partners, in a better position to satisfy shoppers, increase sales and realize tangible operating efficiencies. From a shopper engagement perspective, accurate and consistent product information online is no longer a nice-to-have it s a must. Shoppers are researching products on digital devices before they go to the store and even while at the store, and brands that are absent digitally will end up absent from shoppers carts. Once a shopper has engaged with a brand online and has entered the store with the intent to buy, the in-store brand experience needs to be just right to reach a sale. From space management to on-shelf availability to in-store merchandising, product information is crucial to successful in-store execution, a fact that becomes apparent at the moment of truth. Meeting shoppers expectations in stores and online is going to get more complex. With fulfillment options evolving including buy online, pick up in-store, category selections contracting at the store and expanding online, and digital promotions significantly impacting in-store demand, manufacturers ability to integrate B2B and B2C and deepen retailer collaboration is imperative. The first step to increased integration and collaboration is a consistent base of product information. 32 cgt may 2015 consumergoods.com consumergoods.com may 2015 cgt 33

2 Consumer Goods Technology March 2015

3 1. Where are your products primarily sold? Multiple responses permitted. Products sold % Mass merchants 73% Club stores 48% Specialty retail 46% Online 39% Drug stores 38% Dollar stores 30% Convenience stores 20% Other 23% 73% 48% 46% 39% 38% Mass merchants Club stores Specialty retail Online 30% 20% 23% Drug stores Dollar stores Convenience stores Other

4 2. What is your primary consumer goods vertical? Primary vertical % Food / Beverage 50% Footwear / Apparel 16% Health and Beauty 16% Household Products 14% Consumer Durable Goods 4% 50% Food / Beverage Footwear / Apparel Health and Beauty 16% 16% 14% Household Products Consumer Durable Goods 4%

5 3. What primary role do you serve within your organization? Primary Role % Marketing / Brand / Digital Information Technology 25% C-Level 14% Supply Chain / Logistics 9% Product Development / R&D 7% Category Management 7% Shopper Insights 5% Sales 4% Other 2% 25% Marketing / Brand / Digital Information Technology C-Level Supply Chain / Logistics 14% Product Development / R&D Category Management 9% 7% 7% 5% 4% 2% Shopper Insights Sales Other

6 4. What key initiative will help your organization to better engage shoppers? Key initiative % Increased collaboration with retailers 38% Data-driven product assortments 20% Sophisticated shopper insight programs 16% Compelling and consistent Omni-channel brand strategy 15% Personalized promotions 11% 38% Increased collaboration with retailers Data-driven product assortments 20% 16% 15% 11% Sophisticated shopper insight programs Compelling and consistent Omni-channel brand strategy Personalized promotions 5. Where do you feel consumers primarily get information about your products? Information % Corporate brand website(s), mobile apps, social media 32% Word of mouth / friends / personal social media 30% Retailer websites, mobile apps, social media Newspapers and magazines 5% Third-party websites or apps (e.g. nutrition sites, bloggers, search engines) 2% Other 4% 32% 30% Corporate brand website(s), mobile apps, social media Word of mouth / friends / personal social media Retailer websites, mobile apps, social media Newspapers and magazines 5% 2% 4% Third-party websites or apps Other

7 6. With shoppers frequently researching product images and information online, what are your biggest challenges in keeping this content up-to-date? Multiple responses permitted. Biggest challenges % Lack of internal resources to create, host and maintain this content 57% The pace in which product content needs to be updated 45% The sheer volume of platforms, media and other sources that require this content Lack of internal resources to manage the distribution of content to retailers, others 43% Not having a single repository of product content 25% 57% 45% 43% Lack of internal resources to create, host and maintain this content The pace in which product content needs to be updated 25% The sheer volume of platforms, media and other sources that require this content Lack of internal resources to manage the distribution of content to retailers, others Not having a single repository of product content

8 7. What percentage of your organization's product portfolio is updated each year that would impact product images and/or data? (e.g. changes as a result of updates to packaging, ingredients, marketing claims, regulatory compliance, etc.) % updated each year % Greater than 25% 24% 20 to 25% 25% 15 to 20% 24% 10 to 15% 18% Less than 10% 9% Greater than 25% 24% 25% 24% 18% 9% 20 to 25% 15 to 20% 10 to 15% Less than 10% 8. What types of enhanced or additional product content do you currently offer or plan to offer shoppers in the next 6 months on your corporate website to create a more engaging online experience? Multiple responses permitted. Enhanced content % More product images / views 61% Value added content, including recipes, product reviews, pairing suggestions, etc. 57% Expanded product details, including 'why-buys' / romance copy 54% Video 36% Digital Coupons 30% 61% 57% 54% More product images / views Value added content 36% 30% Expanded product details Video Digital Coupons

9 9. What types of enhanced or additional product content do you currently offer or plan to offer shoppers in the next 6 months on your retail partners' websites to create a more engaging online experience? Multiple responses permitted. Enhanced content % More product images / views 49% Expanded product details, including 'why-buys' / romance copy 47% Value added content, including recipes, product reviews, pairing suggestions, etc. 40% Digital Coupons 30% Video 28% 49% 47% 40% 30% 28% More product images / views Expanded product details Value added content Digital Coupons Video 10. What key initiatives are you partnering with your retail partners on to deliver an improved experience in-store, either currently or in the next six months? Multiple responses permitted. Key initiatives % Market research 50% Digital Promotions 44% Initiatives to improve planogram compliance and on-shelf availability 44% Store specific assortments 41% Store optimization and floor planning 41% 50% 44% 44% 41% 41% Market research Digital Promotions Initiatives to improve planogram compliance and on-shelf availability Store specific assortments Store optimization and floor planning

10 11. When working with retailers to develop planograms that meet shoppers' expectations, what is your primary resource for creating these planograms? Primary resource % Internal resources 48% Broker 24% Retailer resources 22% Wholesaler / distributor 6% Planogram Services Company 0% 48% 24% 22% Internal resources Broker Retailer resources 6% 0% Wholesaler / distributor Planogram Services Company 12. In the next 6 months, how likely is your organization to use virtual reality for the purposes of enhancing shopper engagement and / or shoppers' in-store experience? Use virtual reality % Extremely likely 11% Very likely 9% Somewhat likely 18% Not likely 63% 63% Extremely likely Very likely 11% 9% 18% Somewhat likely Not likely

11 13. If planning to incorporate virtual reality, what primary area of your business will virtual reality / virtual environments be used? Primary area of business % Not planning to use virtual reality 62% Category management 15% Virtual merchandising 8% Shopper research 8% Store design 6% Other 2% Not planning to use virtual reality 8% 8% 6% 2% Category management Virtual merchandising Shopper research Store design Other 15% 62% 14. What is the one major use of 3D in your organization today that directly or indirectly contributes to an enhanced shopper experience? Major use of 3D % Not currently using 3D models 65% Planogram development 16% Market research with virtual environment / 3D models 13% Spin capability for website use 4% Other 2% 65% Not currently using 3D models Planogram development 16% 13% 4% 2% Market research with virtual environment / 3D models Spin capability for website use Other