RMS Academy-Value Volume Share and Growth (en)

Introduction

Welcome

Learning Objectives

This session will demonstrate RMS sales measures. Following the session you will be able to: 

  • Calculate and apply volumetric and value facts for trend and share analyses.

Frequently Asked Questions

Value, Volume, Share and Growth questions are… 

  • How big is the market?
  • Which segments are growing/emerging?
  • How are the key manufacturers/brands performing?
  • What are the opportunities?

Value and Volume Sales

How can sales be evaluated?


Package/Unit

  • The number of packages purchased by shoppers
  • Not dependent on size of package
  • How many packs of a product were sold in a given time period

Volume

  • The number of packages/units purchased converted to the most appropriate unit of measure (e.g. Liters, Kilograms, 1000's)
  • Often referred to as Equivalized sales or Converted sales

Value

  • The sales in local currency

Sales Growth and Sales Decline


Can be expressed in two ways: 

Absolute Change vs. YA = Sales This Year - Sales Last Year

% Growth vs. YA = Sales This Year - Sales Last Year  x 100
                                  Sales Last Year        


Note:

It is most common to compare current sales with either "year ago" or "prior period."

  • Actual Growth
  • % Growth

It is important to use a benchmark

  • Manufacturer's product growth vs. competitive items growth or category growth
  • Retail chain growth vs. channel growth or total region

Sales Growth and Decline Example

Provide understanding of the sales relationship between brands, demonstrating strengths, weaknesses & opportunities.

Click on fact names 'i' to demonstrate interpretation of this chart.

Share

Share of Category vs. Share of Market


What is the difference between sales and share?

Sales is the amount of product purchased by consumers.

Share is the relationship between the focus product and the universe.

Product Share Channel Share
Percent of category sales the brand or manufacturer represents Percent of Total Market sales represented by the Channel
Share based on the product dimension Share based on the market dimension

Share of Category vs. Share of Market Example

Watch-outs

When calculating average shares over a period of time, absolute volumes should be used. Do NOT calculate average shares by adding shares and then dividing them by a set time period - this calculation could be very misleading, as shares in different periods would reflect different volumes particularly in seasonal markets.

Exercise: Share and Change

Use your calculator to complete the table and answer the questions. 

Please select the correct answers.

  1. Which Brands gained share? 
  2. Which Brand gained the most share? 
  3. Out of Brands B and C which Brand gained the most share? 

Exercise: Share of Market

  • Hypermarkets
  • Supermarkets
  • Convenience
  • Petrol
Evaluating Share of Trade allows you to determine opportunity channels for products.

Your client works in the Candy Category and would like to test a new product in one of these channels. Which would you recommend and why?

Share Gap Opportunity

A method of quantifying opportunity based on achieving share target. 

What is a Fair Share Gap?

A difference when comparing shares that provides a recognizable opportunity to increase sales. Used to compare between brands, between channels/retailers, between types of shares or compare share of shelf/sector.

Calculation: 

Value of one share point x # of opportunity share points
OR 
Value Sales  x Opportunity
Share







Mfr A has opportunity to increase share in Supermarkets

Supermarkets share gap to Hypermarkets = 10.0 pts
Value of 1 share point in Supermarkets = 50
Value Opportunity = 10.0 X 50 = 500

Share Interpretation

Share is one of the most valuable metrics that Nielsen provides, therefore, using appropriate Share targets is critical.


What is Share Change Tolerance?

  • Share Change Tolerance ranges are simple guardrails to enable you to determine whether a share change level is significant.
  • It recognizes external market conditions impacting reporting stability and precision, which enables country specific guidelines based on macro and retail conditions.

How does awareness of Share Change Tolerance enhance usage of reported share data? It tells:

  • Is share movement between periods significant?
  • Is a share target challenging or attainable?

Applying Share Change Tolerance: Responding to "non-significant" share movement creates significant waste. 

How does Share Change Tolerance Apply?

Example: In a dynamic market with significant change in the retail universe, such as this example market, the Share Change Tolerance is +/- 0.8 


Interpretation:
Brand A share movement is not significant, the share changes period on period are driven by market conditions as opposed to brand performance.
Brand B share movement is significant, after a short term uplift in performance the brand is demonstrating signs of a sustained decline. Corrective action is required.

Modern Man Case Study

Situation and Background

Category Overview

Gain an understanding of the Men's Moisturizer Category and sub-categories to identify:
How big is the market? Which segments are growing/emerging? Is there opportunity? 

  • Oil Control
    Fastest growing segment
  • Basic Care
    Largest segment, experiencing growth
  • Anti-Aging
    Declining segment in both value and volume sales
  • Blemish Control
    New segment with smallest share of category

Brand Performance

Learn about the value and volume performance of major category brands to understand:
How are manufacturers performing? 

Please select True or False for each statement below.

  1. Category value sales are outpacing volume sales, suggesting rising prices. 
  2. Modern Man is volume share and value share gain leader. 
  3. Men's Champion provides the biggest threat to competitive brands. 
  4. Nature‚Äôs Potion, the largest player in the category, has suffered the most from growth of competition. 

Segment Opportunities

Understand brand contribution to each segment and identify growing vs. declining brands to isolate: In which segments am I strong/weak? Why?
 


Match the analysis of Modern Man's situation to the segment.
  • Oil Control
    Modern Man share position strengthened in this segment, the largest segment
  • Basic Care
    Modern Man lost considerable share to new brand introductions

Modern Man Case Study Summary

Executive Summary

Modern Man has improved category share and is now the #2 player within the largest segment, Basic Care. 
Modern Man needs to gain larger share in Basic Care segment. 
If Modern Man is able to gain 1 share point in Basic Care it is worth 6.5 Million value.