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CPG companies can go deeper with consumer insights to get to value

Many consumer goods companies are just skimming the surface of consumer data. Explore reasons to delve deeper to get to value.

Companies have begun to realize that macro segments no longer exist. We have shifted from a world where a grocery store might have five customer segments to a world where Netflix has 76,000 micro genres of films. Data about consumers has never been more available and abundant, and the technology to make sense of it has never been more mature. Taking full advantage requires more than just ‘big data’ – it’s about taking analytics, and even consumer interactions, to a new level of granularity, then bringing it back up to a level that’s actionable at scale. Such micro segmentation can allow companies to create net new value – just look at the original content Netflix has produced in the past few years based on consumer analytics.

What to do with the data
Making sense of massive amounts of data can be daunting, but not so much when you take it piece by piece.

Break it down
Begin by taking your consumer information and breaking it down to the most granular level possible. This dissection might include looking at trade promotion data, transactional data, social media data and even in-store data on the consumers that are shopping there. This is the first step to capturing extraordinary insights into the consumer.

Rebuild it
Once you’ve broken down data to the fully fragmented, most granular level, there’s an opportunity then to look across those pieces and recompile to an aggregate level. Think of it as building different compounds out of the same molecules that you started with. What do those new formations look like? Are there patterns that emerge? By reassembling the components, it may become clear that there are similar behavior patterns among groups of consumers. Store clustering is one way to imagine this concept. In the past, CPG companies would cluster stores by size, demographic and geography. That approach works well for a regional media buy, but it doesn’t answer the question of, “what promotion should I run in a given store at a particular time?” Granular data helps CPG companies learn who is consuming the product and how they behave. Behavior may be very different among consumers in the same size store with a similar demographic, or it may be very similar to the behavior of consumers shopping nearby at different format. By breaking down the data to a micro level, CPG companies can begin to assemble demand-driven store clusters that tie specifically to what consumers are buying and consuming.

Exploit it
Rebuilding granular data into something of more value has impacts on social engagement, dialogue marketing, shopping list management, mobile ordering and more. It can help brands to step away from large-scale promotions and move toward customized journeys that add value at every touch point. And data is not the only thing that will go molecular – fragmented customer interactions will create a new opportunity for engagement as the Internet of things grows. This newfound granular layer of detail will usher in a new era in brand strategy, consumer engagement and service delivery for years to come, but only for the companies who are ready.