mother and child in store

In Retail, Success Can Be Mapped Out

The key to success is knowing where to place your product

CPG, FMCG & Retail | 14-05-2019

The retail landscape in Malaysia is evolving rapidly. The universe of stores and channels are exploding driven by rapid urbanisation, the rise in connectivity and consumers’ increasing demand for convenience.

In 2018, Malaysia’s FMCG market grew by 4.9%1. During this time, trade growth was driven by smaller format stores, with provision shops, convenience stores and personal care stores each enjoying double digit value growth2. The boom in proximity retailing is further evident in the increasing number of visits to mini markets, convenience stores and provision shops over the past three years, while visits to hypermarkets remained flat and supermarkets declined3.

Add the emergence of online grocery shopping into the mix, and the pressure is mounting for FMCG manufacturers and distributors to remain competitive without resorting to price and promo wars that ultimately strain margins.

So rather than succumbing to the pressure to increase distribution across the board in the hope of landing in the shopper’s basket, brands should remember that not all stores are created equal.

The price of imprecision

Our data shows that just 8% of stores drive 50% of sales for any product. Imagine the consequences of relying on guesswork and therefore missing the opportunity to be on the shelves of your winning stores?

So, for manufacturers, the price of imprecision is too great - from the loss of sales, not to mention the misallotment of trade spend resulting in wastage. To win, they must zero-in and get onto the shelves of these high-potential stores. They can do this by answering four simple questions:

  • How many stores are in my market?
  • Which stores should be my priority?
  • Is my brand present in these priority stores?
  • Where are these stores located?

Without the answers to these questions, brands cannot develop a precise distribution strategy that will generate a healthy return on investment. Nielsen Malaysia’s 2019 Retail Census, which covers more than 100,000 stores in Peninsular and East Malaysia, provides manufacturers and distributors comprehensive shopper, store, market and category data, which can help them efficiently locate shoppers and identify areas of high category demand.

Combined with Nielsen’s rich purchasing data, brands will be able to access comprehensive and timely information to efficiently pinpoint stores that have the potential to sell higher volumes of their products, thereby strengthening their go-to-market strategy and reducing trade spend wastage.

To learn more about Nielsen’s Sales Effectiveness solutions, or to get help identifying your high potential stores, please contact your Nielsen representative or email [email protected].

Notes:

  1. Nielsen Malaysia Retail Index 2018 (80 categories, excluding cigarettes, beer and shandy), Peninsular Malaysia
  2. Nielsen Malaysia Retail Index 2018 (80 categories, excluding cigarettes, beer and shandy), Peninsular Malaysia
  3. Nielsen Shopper Trends Report 2019

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