Marketers need to take a multidimensional approach to assess the performance of their brands. Chris Percy outlines the changes Nielsen has made to the Top Brands report this year.
Nielsen works with a broad spectrum of clients across various industries, and they all have one thing in common – in order to succeed, the consumer/shopper needs to be a central part of any company’s marketing and/or sales planning. Given the new, more savvy grocery shopper, we felt it was appropriate to introduce a range of fresh consumer dimensions outside of sales performance to this year’s report. As part of this unique approach to ranking the Top 100 Brands list and the Top 25 Umbrella Brands list, we have developed The Nielsen Brand Score – a ranking system based on a combination of the key consumer metrics – penetration (household presence), average household spend levels, and attitude towards the brand.
This is the first time this multidimensional approach has been adopted anywhere in the Nielsen world, and is a more comprehensive way of reviewing the performance of grocery brands. Manufacturers and advertisers can use this report to identify how brands are performing within the key consumer metrics compared to other super-brands, and most importantly, can immediately see where the opportunities are to grow these brands even further.
What is clearly evident from this report is that getting the optimal balance between the various elements of the marketing mix is a key factor driving the success of these brands. Knowing which levers to pull will depend on how your customers view, use and shop for your brand and could include tactics such as: expanding your brand reach by attracting new consumers through investing more in advertising, rolling out below-the-line activities in-store to encourage consumers to spend more on your brand, or build a stronger brand connection through a combination of the above.
Congratulations to the brands that made it in this year. It is a huge feat given that there are thousands and thousands of brands in the grocery sector today, and the multitude of financial challenges and pressures that have been presented to manufacturers, retailers and consumers alike over the past 12 months.
If you would like to know more about the information we used in this report, please do not hesitate to contact your local Nielsen representative, or visit Au.nielsen.com
Chris Percy is managing director consumer group at Nielsen Pacific.
Definitions of a brand
Defining a brand can be difficult. Manufacturers often have different views of what makes up a brand, sub-brand or umbrella brand.
Nielsen has compiled two separate lists in this report. The Top 100 Brands list defines a brand within a single category. Range extensions under the same name are classified as one brand – Diet Coke for example, is included in the Coca-Cola brand. Sub-brands that can be viewed as brands in their own right are listed as individual entries – Arnott’s Shapes and Arnott’s Tim Tam are both included in the Top 100 list.
Umbrella brands include any brands that span across categories – such as Heinz soup, baked beans/spaghetti, frozen vegetables – or have multiple big sub-brands within a single category – such as Nescafé, which includes Blend 43, Gold, Café Menu.
The Nielsen Brand Score Methodology
With market trends dictating a move toward more consumer and shopper centric strategies, it is vital that manufacturers understand the underlying factors contributing to their net sales results. It is these underlying triggers that will determine the most appropriate growth strategies to be employed by the brand and the optimal mix of above-the-line versus below-the-line activity.
It is for this reason Nielsen has undertaken a unique approach to the methodology behind the compilation of this year’s Top 100 Brands and Top 25 Umbrella Brands ranking. Nielsen Australia has moved from a purely sales based measure to determine the ranking and has instead, introduced for the first time globally The Nielsen Brand Score.
The Nielsen Brand Score is a multidimensional measure derived by combining three key consumer metrics, and brands are scored according to their overall performance across these areas:
• Household penetration: Measures the presence of the brand in the home – How many households bought the brand during the 12 months to October 2009;
• Average spend: Measures the average amount that households spent on the brand in the 12 months to October 2009;
NB: Household penetration and average spend numbers are sourced from Nielsen Homescan – a 10,000 household consumer panel, the largest in Australia, that is geographically and demographically representative of the Australian Household Population. Homescan measures actual consumer take home purchases over time across all channels, and is collected using electronic barcode scanning technology.
• Attitudinal index: Measures consumer attitude towards the brand. One thousand five hundred respondents on Nielsen’s Omnibus online consumer panel were surveyed on the Top Brands on three dimensions which establish how engaged they are with that brand in terms of it being a brand they love, a brand they trust, and a brand they would recommend.
Note that due to restrictions on consumer advertising for cigarettes/tobacco – this category has not been included as part of this year’s list.
For transparency, the rankings for the key consumer metrics are included so that manufacturers and advertisers can understand the key drivers behind each brand’s performance. For example, Vegemite is ranked at number 15 in the Nielsen Brand Score. Driving its position in the list is the extremely favourable score this heritage brand has achieved in terms of household penetration and attitude towards the brand – ranked five and two respectively. However, the amount consumers spent on Vegemite annually is ranked at 93, presenting an opportunity to further drive the brand’s position by increasing consumption. This is evidenced by the manufacturer investing an additional 34% in media advertising over the past year, in addition to any below-the-line activities to extend usage.
Comparisons
Nielsen has provided information to the grocery industry on consumer and retail trends for decades. The Top 100 Brands Report is now in its 14th year and continues to generate much interest and feedback.
Nielsen has made every effort to ensure the data in this analysis is accurate. However, due to the constant shifting of the marketplace, the magnitude of the analysis, and the new methodology for the 2009 report, Nielsen cannot guarantee all omissions or discrepancies have been corrected.
Due to the completely unique approach Nielsen has used for determining the Top 100 Brand and Top 25 Umbrella Brand ranking this year, comparisons to previous Nielsen Top Brands Reports will not be valid.
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