Discover how CPG/FMCG marketers & CMOs can use geospatial analysis & data to evolve their analytics to rapid consumer changes in the new normal
Think about this time last year and ask yourself these questions:
- Has your office location changed?
- Are you or your family living in a different location?
- Are you shopping the same way?
- Have you bought a puppy?
The COVID-19 pandemic and the new normal we now live in has forced us to change a lot of our behaviors in a short space of time. A high percentage of the workforce has moved to remote working apartment building amenities have changed the shift to e-commerce has been accelerated by 5 years and even puppy prices have risen!
Have analytics professionals in the CPG market evolved their workflows and data to this new normal? The answer is probably not since they are usually buying data from their typical providers and often using outdated census data (by average 9.4 years old on a worldwide basis weighted by population). Given that 90% of worldwide purchases are predicted to take place in-store versus online in 2025 (source) understanding offline real-world behavior of consumers is crucial for CPG brands to pivot their strategies.
In this post adapted from a recent webinar we held we outline 7 reasons why CPG Marketers are turning to location analytics including looking beyond the census and using additional proxy location data sources.
1. Spending behavior has changed forever
What we spend money on and how we spend it has changed. For example consumers are spending much more on home fitness whilst the high street fashion industry is experiencing a drastic slowdown. The take home grocery market is growing 12% YoY in spite of a 10% drop in the frequency of visits to grocery stores (source). 56% of consumers are buying bulk goods or expecting to buy in bulk (source). In some areas the death of cash is accelerating as contactless payments become more ubiquitous frictionless and allow for larger purchases. As spending patterns change there is a need to understand where people are spending money including their movements.
Near real-time data is required to respond to these changing consumer behavior patterns. The example below uses Mastercard credit card data and shows how changes in spending patterns can be analyzed by category and neighborhood. This gives CPG brands the ability to focus their efforts and adjust their supply chain depending on the needs of their clients. Using alternative sources of data such as this alongside first party and census data allows brands to scale such analysis when delivering goods nationwide.
Change in spending behavior in Eating Places before and after lockdown. Manhattan New York.
2. Mobility patterns change by the week
Mobility patterns are changing on a regular and rapid basis as mandated restrictions on movement respond on a regional level to peaks and troughs of case numbers. As a long term factor local & regional lockdowns are top of mind for brands to navigate. Predicting mobility behavior is closely tied to other demographic & socio-economic variables with specific consumer segments requiring more mobility because they work in certain industries during the pandemic. During the webinar nearly a third of the CPG audience responded that had never used mobility/movement data within such analysis showing there is definite room for growth within the industry.
The map below shows the relative difference of three social distancing metrics with respect to the previous week and uses human mobility data from Safegraph.
3. Social sentiment is unpredictable
Attitudes towards COVID-19 are closely tied to location with differing behaviors and attitudes across regions. Social media data (with its limits) can provide indicators on attitude for brands to evolve their content & campaign channels accordingly. Analysing social sentiment around specific topics and being able to see where down to a census tract level consumers are experiencing positive or negative sentiment gives CPG brands more flexibility and granularity in the targeting of their campaigns. Brands using this data have the opportunity to cultivate specific products within locations with loyalist segments whilst also focusing other products on areas with an emerging customer base.
The map below was taken from a recent post where we looked in detail on how behavioral data can be used for such geospatial analysis and shows the relative percentage change in prevalence for Live & Local Music.
4. New workplace trends
As people avoid office spaces shared workspaces in apartment buildings are becoming increasingly popular due to not having to commute and the increases in productivity experienced. This in turn is leading to shared workspaces in prime locations (e.g. Shoreditch Manhattan) suffering with workers opting to meet a handful of colleagues closer to their homes. All of this is underlined by a need to avoid mass transit for the considerable future.
Those buying or renting a new home may be attracted to properties that allow them to walk to work or use micromobility options (such as bikes or scooters). We carried out some analysis identifying walk to work hotspots in London resulting in the map seen below.
These changes in commuting patterns and workplace trends can allow CPG marketers to ensure that their products are stocked within the right store locations according to where their target consumer base is now living working and travelling.
How can Distribution Management & POS Strategy be spatially optimized?
5. Drastic behavioral changes
CPG brands are targeting completely new segments or audiences that they haven’t targeted before which requires new data bringing together online and offline behavior. For example new segments of shoppers who would never normally have bought their groceries through online platforms such as Ocado or Instacart are turning to e-commerce. This means looking beyond solely social media and including first party data from websites customer relationship management (CRM) and data management platforms (DMP).
CPG has traditionally been on the outside when it comes to social media given the historical disconnect between offline behavior and online sentiment. Therefore this gives them the opportunity to use location data in a new way as it relates to their business.
Using Dstillery’s behavioral data can bring these digital based audiences to the physical world for geospatial analysis thus expanding and enhancing first party data. An example can be seen below using their Online Shoppers audience index.
6. New transit preferences
With lockdown policies in a state of flux around the world certain demographics are opting to avoid mass transit and use ridesharing more or buy a vehicle. This means that there are changing demographics being exposed to roadside media. With many leaving cities for second homes or selling up there is also increased value for less urban outdoor media. This can change pricing strategies entirely which would be of great interest to many CPG brands.
7. Physical brick & mortar data must be real-time
With the highstreet now declining at a much faster rate retailers are consolidating site networks and opting for curbside collection formats. Quick service restaurants (QSR) & higher-end restaurants are opting to increase the number of ghost kitchens serving their delivery business. Changing behavior of typical Point of Interest (POI) visitors (universities hospitals schools parks) is critical data for CPG marketers evolving their strategies.
POI data from February will be significantly out of date so having access to accurate and frequently updated data is paramount. Given the high rate at which stores are closing POI data needs to reflect that change. The most successful CPG companies are combining different sources of data (e.g. Pitney Bowes HERE OpenStreetMap and scraping data from other sites) to get a holistic view of the locations of where POIs actually are.
360 View of Consumers
To tell the right stories in the right place CPG marketers are going to need a 360 degree view of consumers by evolving their analytics by considering these reasons and taking advantage of the detailed techniques and data.
During the webinar over half of the attendees reported that they were using 5 or more third party data providers which as we’ve outlined is increasingly important but can also cause issues and time delays during the processes of finding curating validating and negotiating. Using spatial data catalogs can save time on data discovery and reduce costs by including all relevant spatial data in one place including population demographics purchasing power credit card transactions points of interest climate road traffic and more.
With a Business Intelligence (BI) platform you can likely figure out where your target consumer group are hanging out (which historically was fine for the CPG industry) but a Location Intelligence (LI) platform will help you discover why there & how their behavior may change over the next crucial 6 months.
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