Walmart to Share Scan Data

Discussion
Jul 22, 2011
George Anderson

Walmart says it wants to better understand its customers. That’s why the company has reversed its position and agreed to share its scan data with outside research firms. The company has already reached a deal with Nielsen and is reported to be very close on a similar deal with SymphonyIRI.

Since Walmart first made the decision not to share its data, suppliers to the company have been able to see how well their products sold, but not competitors. Having this additional information is seen by many as critical to fully understanding the market.

“This is a very big deal, to know how these companies’ products are selling at Walmart,” Dave Kolpak, an analyst at Victory Capital Management, told Reuters.

One exception to the no data sharing rule at Walmart has been Sam’s Club. The division, which has participated in syndicated data services, is the one area of Walmart’s business that has achieved growth in the U.S. in recent years.

Cindy Davis, executive vice president for global customer insights for Walmart, is a former executive at Sam’s Club. She said in a statement that sharing data would help Walmart gain “deeper insights into customer purchasing — and unmet needs — both nationally and in key local markets.”

“We plan to share our point-of-sale information to help us identify category growth opportunities sooner and collaborate with our manufacturer partners to develop more impactful customer-driven programs going forward,” Ms. Davis added.

Discussion Questions: Why do you think Walmart is making sales data available again to Nielsen and SymphonyIRI? What will data mean for consumer product manufacturers and other retailers?

Please practice The RetailWire Golden Rule when submitting your comments.

Join the Discussion!

11 Comments on "Walmart to Share Scan Data"


Sort by:   newest | oldest | most voted
Joel Rubinson
Guest
9 years 9 months ago

In the early 2000s, I was at the NPD Group when they pulled their data from us as well. At the time, I said it was shortsighted and reflected hubris that Walmart thought it controlled their customers. I knew there would be a watershed moment when that feeling had to change, although I’m surprised it took so long. No one controls the customer any longer and a full view requires industry cooperation. Congratulations to Walmart because, ultimately, the consumer will be the winner as Walmart and its vendors make better marketing decisions that add more value to daily life.

David Biernbaum
Guest
9 years 9 months ago

Walmart, which is now under different management than it was back in the day when it isolated itself from published sales data, probably realizes that it needs to be part of the overall retail and CPG industry. Walmart is doing a good service to our industry by participating with IRI and Nielsen so that our industry can more accurately measure sales data in a far more meaningful way. Without Walmart IRI and Nielsen data always had to be interpreted and explained with an asterisk. In any case, I strongly believe that Walmart’s isolationist days are giving way to a newer philosophy and strategy that will be beneficial for all of us in the business of retail and CPG marketing.

Gene Hoffman
Guest
Gene Hoffman
9 years 9 months ago

Walmart never does anything without having an agenda–open or otherwise. Their business in the USA isn’t as dynamic as it always was and WM is seeking new ways and data to regain its former unchallengeable zenith. That, to me, is what’s behind its new openness.

For CPMs and retailers it means another mountain of information in which to try to control customers. But customers are a wily lot who resist being controlled.

Camille P. Schuster, PhD.
Guest
9 years 9 months ago

If Sam’s Club has been sharing data and has good sales that could certainly be part of the reason for reversing the decision about sharing Walmart data. Since Walmart stores have had no same store sales growth for at least 8 quarters and Sam’s Club has had increased sales, management is taking a long, hard look at how to increase same store sales. Getting data on sales from one retailer without any comparison data provides a limited view of consumers. It was only a matter of time before Walmart reversed the decision because good decisions can not be made with limited data. This is good news for everyone.

Carol Spieckerman
Guest
9 years 9 months ago

I’m impressed that Ms. Davis made this happen so quickly after taking on her new role and you have to believe that doing so was a big reason behind creating the job to begin with. The move comes at a pivotal time for Walmart and other retailers as small format growth, and the accompanying category, competitive, and localization complexities, usher in a new era in retail that will require a delicate balance of granular analysis and big picture context. With the field getting crowded, there won’t be much room for error.

Charles P. Walsh
Guest
Charles P. Walsh
9 years 9 months ago

Walmart didn’t stop sharing data with the outside research firms because they felt it controlled its customers, but for two very different reasons.

First, Walmart felt that the information was very valuable to their competition and that sharing it would/could undermine strategic efforts to grow their businesses. Secondly, facilitated by its vaunted information systems acumen, Walmart believed strongly that through a combination of analytical tools available to their buyers and suppliers (Retail Link and other micro analytical applications) that it was unnecessary to share sales data to outside companies.

Well, times have changed and the sales momentum has slowed/reversed to the point that Walmart has come to realize that sharing this data can/will have potential positive impact on their ability to drive their own business through more complete market compiled data.

I have to believe that in return for the sharing of this data that Walmart has leveraged some pretty valuable services in return.

Richard J. George, Ph.D.
Guest
9 years 9 months ago

In order for Walmart to be successful it needs to continue its tradition of having suppliers partner with them to better serve the target market. Not being able to see the whole competitive array is like watching TV without the sound. You see, but miss key narrative that helps you to understand what you are viewing. Now the market picture is complete with all of the needed sights and sounds.

Walmart gives up some privacy in return for a more robust engagement of suppliers.

Ed Dennis
Guest
Ed Dennis
9 years 9 months ago

My guess is that Walmart has found another revenue stream or information stream that it can use to try to increase prices. Walmart’s success is directly tied to customer perception of the value it provides. Their low price strategy worked like a charm for years, through good and bad times, with more successful times than bad times. However, new management was hired outside the company, and they went searching for silver bullets. For gosh sakes they even had people worried about what color the store was painted! Consultants will tell you that this is important–but customers don’t care if the building is blue or green!

If Walmart would just get back to delivering low prices and great value, all would be okay. Someone in Bentonville has, however, determined that the Federal Government model is best (more staff, centralized decision making, and increasing prices). They don’t care about customer counts, out-of-stocks, dirty stores, beat up buggies, or low prices.

Dennis Serbu
Guest
Dennis Serbu
9 years 9 months ago

Send in the clowns. I can see with the release of WM data that “some” grocery retailers will knee jerk, panic and try to do things they shouldn’t do. On the positive side, it will give competing manufacturers information to develop emerging categories and items for this unique channel. Things happen fast at Walmart because of the mass. It is price oriented so we have to be careful of analyzing how the same strategies might work in conventional channels.

James Tenser
Guest
9 years 9 months ago

A very interesting development. Walmart has traditionally argued that sharing its data with the syndicators would reveal much to others but deliver scarce benefits.

Why the sudden change of heart? Perhaps declining same store sales has something to do with it. Syndicated data suggests greater transparency without revealing too much specific detail.

Or perhaps this is a preemptive measure by the Great Wal, to dissuade efforts by Big CPG to directly measure purchase behavior. It’s pretty easy to scan a receipt with a cell phone camera these days, after all…

Louis Mellet
Guest
Louis Mellet
9 years 9 months ago

This time with Nielsen feels different.

Among other things, the implication for Walmart is that, for the first time in its history, it is actually worried about what its competitors are doing, in terms of comparable supermarket items. The quid pro quo will be to access competitive data and Nielsen insights.

Once upon a time, Walmart dictated the terms of the retail game with pricing. However, Quantitative Easing and the resulting commodity cost increases/dollar devaluation are increasingly stressing the traditional Walmart “feedback loop” business model, forcing Walmart to take price increases on food items.

Food retailers like Kroger, Publix and HEB are way ahead of the shopper insights game, at this point. Walmart now has to play catch up–a strikingly more defensive posture than what we have ever witnessed from Walmart in the past.

wpDiscuz

Take Our Instant Poll

Which party will benefit most from the inclusion of Walmart numbers in syndicated data?

View Results

Loading ... Loading ...