Case Study

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Prosper Technologies Case Study Category Analyst Role Please go to www.LEInsightCenter.com and REGISTER to complete this Case Study. Purpose:

Arguably, the most common data used by category management professionals is syndicated scanner and panel data. The purpose of this case study is to help you understand how other data such as consumer attitudes and macro trends can help explain shopper behavior relative to your product category.

Situation:

You are a Category Analyst supporting one of the larger categories at Kroger. (note: it does not matter if you want to play the role of a retailer or manufacturer as this case study is role agnostic) Both the Buyer and Manufacturer trading partners were discussing current category trends and asked for your help to better understand how macro trends are affecting consumer attitudes and shopper behaviors. In addition to the syndicated data at your disposal, you have access to several less-traditional data elements that are available in the Prosper Technologies InsightCenter.

Instructions:

For each of the following exercises, please access the InsightCenter and assess the specific data sets to form your perspective on: o What’s happening? o So what? o Now what?

Exercise #1 Consumer Confidence (click “Economic” tab at top of InsightCenter and open “Consumer Confidence”)

Typically, consumers will spend on necessities (i.e. staples) first. As confidence grows in the economy, consumers tend to spend more on discretionary goods. They are more willing to take on debt. They may choose to buy more quantity on each trip or indulge with more expensive products. In this exercise, you want to determine how consumer confidence is currently trending, especially for Kroger shoppers. Please answer the following questions: 1. To what degree are there differences between Kroger shoppers with Little/No Confidence versus shoppers who are Very Confident/Confident in the economy? a. CLICK Options tab in top left corner of the

Consumer Confidence Trend Chart and select shopper groups 2. To what degree are there differences between different age groups of Kroger shoppers? a. CLICK Options tab in top left corner of the Consumer Confidence Trend Chart and select shopper groups 3. To what degree are there differences between shoppers in general versus shoppers of specific product categories? a. CHANGE Kroger Shoppers in general to other categories (i.e. HBA and Prescription Drugs) Note: You may want to look at other retailer’s and/or product categories to determine any directional differences that may shed light on shopper attitudes. Exercise #2 Gas Prices (click “Economic” tab at top of InsightCenter and open “Gas Prices”)

Gas prices fluctuate, at times with steep increases and other times dropping precipitously. When prices rise, Consumers are pinched, and often have to make adjustments in terms of trips to the store, amount they spend, how they use coupons and promotional offers, etc. When gas prices drop, and more money is in the pocket each week, confidence levels rise. In this exercise, you want to determine how gasoline prices have been trending, as well as spot opportunities as to how Kroger shoppers and other consumers might choose to make use of Gasoline savings. Please answer the following questions: 1. To what degree are there differences between spending plans of Consumers with Household Income of <50k to those with Household Income of 50k-100k? Look at staples plans like Grocery and Clothing spend vs. Discretionary plans like Dining Out and Big Ticket items – will this impact share of wallet / stomach? a. CLICK Options tab in top left corner of the Impact of Fluctuating Gas Prices on Spending Trend Chart and select shopper groups 2. To what degree are there differences between these earning groups on behavior of plans to buy store/Generic Brands? Look at Use of Coupons and Shopping for Sales plans – what could this mean for your Category planning? a. CLICK Options tab in top left corner of the Impact of Fluctuating Gas Prices on Behavior Trend Chart and select shopper groups

3. To what degree are there differences between shoppers at other Grocery, Mass Merchants, and Warehouse Chains, as well as different shopper groups? Will this present Opportunities or Threats for your Retailer? a. CHANGE Kroger Shoppers in general to Kroger Shoppers for HBA or Kroger Shoppers for Prescription Drugs Note: You may want to look at other retailers and consumer demographic segments to determine directional plans that may indicate Spending and Behavior differences. This will prove useful if you are developing a Store Cluster strategy for your Retailer Exercise #3

During strategic planning periods of the year, your Retailer Competitive SWOT typically conducts a SWOT – Strength, Weaknesses, Opportunities, and Threats – evaluation of their business and stores. That SWOT positions them to better run to their Strengths while tackling perceived Weaknesses, and thus (CLICK on “Category Dive” at opening up Opportunities and manage Threats during the upcoming months. top of InsightCenter and open “Grocery” In this exercise, you want to provide your Retailer, Publix with a candid Consumer perspective of their view of Publix. Simultaneously, you want to offer Publix a view to competitive Grocers, Mass Merchants, and Warehouse Clubs within their markets, as well as Grocers similar to them outside of their core markets. Please answer the following questions: 1. On a Year over Year basis what are the “Share of Mind” beliefs of the Consumer (Stores they Shop Most Often for Grocery) changes for Channels of Grocery, Mass Merchant, and Warehouse Club? What Consumer trends over the past 5 years can you point to for Kroger, Food Lion, Winn-Dixie, Harris Teeter, and Piggly Wiggly for Grocery; Walmart and Target for Mass Merchants, and Costco and Sam’s Club for Warehouse? a. CLICK Options tab in top left corner of the Store Shop Most Format and the Store Shop Most Often Trend and select Formats and/or Store Banners 2. What is the monthly Spend for Adults, 18+, Publix, Kroger, HEB, Shoprite, Safeway, Target, Costco, and

Sam’s Club Shoppers? Who is gaining at the cash registers? b. CLICK Options tab in top left corner of “Groceries” Monthly Spend and select Retailer comparative trends 3. What Strengths and Weaknesses does Publix have compared to those of Adults, 18+? What Strengths and Weaknesses do they have compared to other specific Grocers, Mass Merchants, or Warehouse Clubs? a. CLICK Options tab in top left corner of “Groceries” Store Loyalty – view “Reasons” and “Likeliness to Recommend” (Net Promoter Score) 4. Help Publix understand how they are gaining or losing sales by Consumer Cross-Store or Cross-Channel Shopping. Are consumers buying their Meat Products often enough at Publix? Who is Publix vulnerable to losing Meat sales? How might your product lines boost Publix Meat sales and increase Ticket? a. CLICK Options tab in top left corner of “Groceries” Meat Products – view “Do you shop for Meat Products at the same store as your other groceries?” and “Shop most often for Meat”