Consumer analytics for lifestyle product retailer

Client: Europe-based retailer selling its products across 5 countries

OPPORTUNITY: The client’s existing product and outreach strategies were not working well, as sales of flagship products had seen a volume decline for three consecutive quarters. The company wanted to understand the major factors that drove/inhibited purchasing and accordingly improve the focus across marketing initiatives.

SOLUTION:

SG Analytics involved its industry experts to design, test, validate and conduct a survey in the client’s most important market to gauge the attributes that drive consumers’ buying decision:

• The SG Analytics team performed MaxDiff scaling on the data received from the survey. SG Analytics then conducted PrincipalComponent Analysis (PCA) using Correlation Matrix and Varimax Rotation. The team then finalized the FactorSolution after selecting emotional and functional factors on the basis of the Scree Plot and Maximum Variance Explained.
• Using the factor scores obtained and the least correlated contextual variables, SG Analytics identified the statistically-best discriminating variable (the variable that best splits occasions into groups of responses with shared needs) using a two-step Cluster Analysis
• SG Analytics team repeated the process to identify multiple such descriptors that fully segmented the survey data, and created the Driver Tree with unique and discrete micro-spaces. SG Analytics profiled the micro-spaces in detail, which became an input to the client’s product development and marketing strategy teams

VALUE DELIVERED:

• Deeper understanding of consumer needs that improved the efficacy of the product strategy
• Improved focus on marketing efforts, customized as per the needs of various micro-spaces
• Total beverages revenues up 15% year-on-year