Kroger’s data-science division, 84.51°, has launched a new analytics solution to help branded suppliers better position their products with consumers, in-store and online.
Single view of in-store and online performance
The new tool, Stratum, has been developed to help Kroger’s branded suppliers gain new insights into product performance. Given Kroger’s broad reach, Stratum will be fuelled with insights from one out of every two households in the US, delivering conclusions that are representative of consumer behaviour nationally. With access to in-store and online purchases in a single view, brands will be able to access data on sales performance, inventory and out-of-stocks, ranging, promotions, customer segmentation and behavioural insights, new item performance, and in-store space management. Kroger will also be able to apply the tool to its private label portfolio.
Source: IGD Research
Enhanced data visibility
The platform provides Kroger’s suppliers with an enhanced level of granularity. Users can analyse sales performance at item and store level, evaluate promotional performance and better understand who their customers are to determine white space opportunities. Customer behaviour reports highlight new, loss, retained and switching behaviour, helping brands to gain insights into household preferences. Suppliers will also be able to track inventory daily and improve demand forecasting.
Developing alternative profit streams
Kroger established 84.51° four years ago when it purchased the remaining 50% of its joint venture with Dunnhumby and Tesco. The business was further enhanced with the acquisition of Market6 in 2016. The launch of Stratum aligns with its plan to change its profit model through developing alternative profit streams. It plans on optimising its stores, logistics and data assets to create incremental new profit streams as part of its goal to grow operating profit by $400m by 2020.
Data as a competitive advantage
Data capabilities are increasingly becoming a source of competitive advantage in food retail. Through 84.51°, Kroger has established a lead in this space which it can use to drive additional income and optimise to enhance the performance of its private label portfolio. Retailers have been investing in technologies such as machine learning and artificial intelligence to enable them to mine their data at scale and identify new insights. The challenge for manufacturers is to ensure they are developing their own data capabilities in a similar way.
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