par Emilie Schaefer4 June 20200 commentaires

How consumers are driving retail transformations: More quality

We tackled it in our 2 first articles of this saga, data is fuelling operations throughout the entire company and it proves to be a challenging resource to manage. With data in high demand, it is not only the amount of data that is important, but also its quality.

Data quality directly affects the user experience

Discrepancies in product data across different channels, such as differences between product packaging displayed online and in-store or nutritional information on a product’s packaging that contradicts the information in a consumer app, can lead to the loss of both sales and consumer trust. Data needs to be consistent, whether on store shelves, e-commerce sites, or apps. This consistency can no longer be considered simply “nice to have” — it’s become an essential prerequisite for effective customer relations, in a context where consumer journeys are a blend of the offline and online interactions.

Data quality plays a key role in addressing traceability and regulatory requirements

Whether for food, household products or cosmetics, regulatory pressure in terms of labelling has increased sharply over the past few years. INCO regulations have made nutritional declarations on food products mandatory since December of 2016, and European legislation has defined specific rules for food labelling: consumers must have access to the same information online as they do in stores. The Nutri-score system, while not (yet) mandatory, also requires high-quality data.
Monitored by the General Directorate for Fair Trading, Consumer Affairs and Fraud Control (DGCCRF), it is imperative for retailers to maintain extremely rigorous standards. Since manufacturers are still the experts on their products, retailers need to work in close collaboration with them to streamline the process of sharing data as regulations become increasingly strict.

This means that data accuracy has become a key criteria for evaluating manufacturer performance, just as consequential as business competitiveness. A criteria that needs to be carefully managed over time, as well as updated regularly. The reason is clear: why list products from a commercially appealing brand if penalties due to non-compliant labelling will later cut into the margins? For example, INCO regulations include criminal penalties and fines of several hundred euros per point of sale for each non-compliant label. This risk falls on retailers, who are seen, in this case, as the providers of this information, and therefore responsible for it.

Note that the food industry is not the only sector affected by these regulations. For household cleaning products, the CLP (Classification, Labelling, Packaging) regulation was implemented gradually, before completely replacing the existing European system in June of 2015. As for cosmetics, a new regulatory framework entered into force in 2013, notably including an annual audit.

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This saga is based on our Supplier Relations 3.0 white paper which analyses retail transformation and propose some insights on organizational models to answer to the new challenges of this industry.