Download Report


Thank you! Your copy of the report opened in a new tab. If you have trouble viewing it,click here.

Your personal information is kept in accordance with our Privacy Notice.

Introduction to the Retailer Preference Index for U.S. Grocery and the Covid Momentum Metric

In order to reflect on how the grocery world changed in 2020, we have changed how we calculate our overall Grocery RPI score. Given the historically unique metrics we've witnessed in the economy, the restaurant industry and the grocery industry, along with the rare influence a global pandemic has brought to consumer behavior, we're viewing grocery success in 2020 through a different lens than we viewed grocery success in prior years.

Introduction

Our Methodology

Starting in 2018, our Retailer Preference Index (RPI) score established which retailers' value propositions were best positioned to win with customers long-term. Our rankings were the result of a statistical model that predicted how retailer execution on various customer needs – or Preference Drivers – impact both lasting emotional bonds formed with customers, as well as longer-term financial success:



2018-2020 RPI Approach



By understanding how different Preference Drivers propel overall market share

we understand what it takes for a retailer to scale their offering up to different regions, to a wider variety of consumers, which takes time. Modelling against Five Year rather than Year-Over-Year sales growth ensures we understand what it takes for a retailer to maintain growth that isn't just the result of a trend. Finally, knowing what it takes to secure a strong Emotional Connection with consumers sheds light on what will get consumers to keep coming back to retailers long-term, even in spite of events that would temporarily steer them away – like job loss or illness. This year, we are introducing another element to our calculation: the Covid Momentum Metric. This metric results from a statistical model that predicts how retailer execution on the same Preference Drivers impact short-term financial success, namely market share gains or losses during 2020.



By modelling against Covid Era market share gain or loss

we can understand what is driving changes in consumer behavior during Covid. This does not tell us what it takes to win with customers long-term, since the Covid Era is a unique moment in time. However, we nor any retailer should dismiss the Covid Era changes in consumer behaviors or preferences as definitively temporary, especially given the length of the Covid Era and how long these new behaviors have had to wear new grooves in consumers' brains and lives. Therefore, to understand which retailers are best positioned now and for the future, we must consider how their value proposition is positioned to win Emotional Connection, long-term financial results and short-term Covid Momentum. As a result, the RPI score this year is really the RPI+ score. It blends how well a retailer's customer value proposition is positioned for long-term success with how much short-term momentum that same value proposition generated for the special circumstances surrounding Covid:

2021 RPI Approach


FOR RETAILERS

Smarter operations and sustainable growth, powered by Customer Data Science.

FOR BRANDS

Better understand and activate your Shoppers to grow sales.

In the first episode of Customer First Radio, Dave Clements, Global Head of Retail for dunnhumby and David Ciancio, Global Head of Grocery for dunnhumby kick off the series by discussing what it means to be a truly Customer First business, share which retailers and brands today embody a Customer First mindset, and examine how Customer First materialized during the pandemic with retailers.

black and silver headphones on black and silver microphone
Photo by Will Francis on Unsplash

The 2021 Retailer Preference Index: Who's winning and why. David Ciancio, Global Head of Grocery discusses the 2021 U.S Retailer Preference Index (RPI): Grocery Edition with the lead author of the RPI, Erich Kahner. They unveil key insights and discuss who is winning and who is best positioned for the future.

dunnhumby’s Prophets of Aisle Six, Episode 2: Heinen's Fine Foods

The Prophets of Aisle Six is the first online reality series focusing on innovation in the food retail industry. In this episode, Jose Gomes, dunnhumby's North America Managing Director, travels to the downtown Cleveland store of Heinen's Fine Foods. Jose meets with Tom and Jeff Heinen, co-owners and brothers, and learns how they are evolving their grandfather's mission of delivering excellent customer service. With 23 stores in Northeast Ohio and the greater Chicago area, and a 90-year legacy, Heinen's is proving that being a small retailer can be an advantage when it comes to data.

In this series, dunnhumby tours the globe and speaks with some of the world's greatest brands, exploring their biggest challenges and how they are using customer data science to meet those challenges.


In my last post, I posed five questions to retailers to help them determine whether they're ready for a customer-first mindset. Now, I'd like to challenge the retail basics that seasoned retailers were trained on, and suggest instead a new customer data science approach.

"Retail is detail" is common industry wisdom, and it means that achieving success is subtle and difficult. Success in any field demands practice and experience, and so it is little wonder that many senior retail and brand leaders and managers have vast years of involvement, and that most have grown up through the business in progressive steps.

Keep Reading... Show less