CHICAGO – July 11, 2006 – Information Resources, Inc. (IRI), the leading global provider of enterprise market information solutions, today announced the IRI Long-Term Drivers Consortium Study™, the industry’s first strategic study designed to quantify the importance of TV advertising, promotion, distribution and brand variety on the long-term health of brands and the overall consumer packaged goods (CPG) industry. This study provides a broad perspective on the drivers of brand growth and health in the United States and Europe and will be used by CPG marketers to better leverage marketing strategy and improve brand health for years to come.
“Today’s marketing organizations are under intense pressure to produce positive financial returns in the current quarter,” said Lauren Lieberman, equity analyst, cosmetics, household and personal care, Lehman Brothers. “As a result, business units have learned to effectively identify and leverage short-term volume drivers but often don’t pay enough attention to the long-term viability of the brand. For example, while it is evident that temporary price reductions lead to higher sales in the short run, the effect of these promotions on long-term brand health and baseline sales is less clear. The IRI Long-Term Drivers Consortium Study is just what the industry needs to understand how to keep brands healthy and productive well into the future.”
The IRI Long-Term Drivers Consortium Study is adapted from soon to be published academic work, “The Long-Term Effect of Marketing Strategy on Brand Performance” by M. Berk Ataman, Tilburg University; Harald J. van Heerde, Tilburg University; and Carl F. Mela, Duke University. The academic work builds on past industry research to establish new, quantifiable metrics for understanding what drives brand growth and health. The IRI study will use proprietary modeling methodology to control for short-term effects, while quantifying the key drivers of long-term brand health and growth, including TV advertising, in-store promotion, distribution breadth and depth and brand variety. This new modeling technique uses five years of baseline sales and price sensitivity as indicators of a brand’s overall health.
“While it may take years to create a strong and prosperous brand, the current metrics for brand evaluation are short-term focused,” said IRI Global Services President Sunil (Sunny) Garga. “The IRI Long-Term Drivers Consortium Study will help the industry understand both short- and long-term drivers of brand sales. Marketers can objectively make the right trade-offs in spending allocations, deliver required short term ROI, and build sustainable brand value. Imagine brand reforestation; that’s exciting.”
The study will use brand information from a consortium of six to ten national CPG manufacturers to illustrate the relative importance of each driver to brand growth and health over time and will include an analysis of long-term effects relative to the short-term impact of in-store promotion and TV advertising. Consortium members will receive an in-depth analysis of the long-term drivers of their own brands as well as a view of how those brands compare to the CPG industry. They will also receive a positioning and strategy recommendation for brand growth, shaping the way brands go to market in the future.
About The Long-Term Drivers Consortium Study
To learn more about becoming a charter member of the Long-Term Drivers Consortium, visit: http://us.infores.com/page/consortium_study.
About Information Resources, Inc.
Information Resources, Inc. (IRI) is the world’s leading provider of enterprise market information solutions and services, empowering its clients to grow their business profitably in a complex marketplace. Driving the transformation of the consumer packaged goods (CPG), retail, and healthcare industries, only IRI provides a unique combination of real-time market content, advanced analytics, enterprise performance management software, and professional services. The company’s portfolio of services, solutions, and technology enable leading retailers and their suppliers around the globe to see what they are missing, act faster with greater confidence and win at the shelf. Ninety-five percent of the FORTUNE Global 500 in CPG and retail leverage IRI to power their business. For more information, visit http://us.infores.com/.