Decoding AI for CPGs: A Path to Category Management Success

Hosted by the Category Management Association

Curious about integrating AI into your category management practices? Join us for this panel discussion with retail industry veterans and former category and sales leaders at Coca-Cola, Walmart and Nike as they discuss AI adoption in the CPG world.

Our panelists will explore critical topics such as generative AI, strategic starting points on your AI journey, and the nuances of outsourcing AI solutions. Equip yourself with the knowledge to thrive in an AI-driven marketplace and stay ahead of the curve.

  • Identify the best opportunities for AI integration in your category management practices
  • What to look for in an AI partner and how to identify AI white washing
  • Receive expert guidance on where and how to initiate your AI journey, tailored specifically for CPG companies.
  • Benefits and challenges of outsourcing AI talent.
  • Explore the potential of generative AI for CPGs

Get actionable steps and practical advice on how to execute an AI project, both with partners and gain alignment and support internally. Gain clarity and confidence in embracing AI to outpace your competitors in the dynamic CPG landscape.

Presented by:

  • Capri Brixey, EVP, Strategy Consulting at Insite AI
  • Kristine Joji, EVP, Strategy Consulting at Insite AI
  • Marsha Shapiro, SVP of Client Solutions at Insite AI

Four Trends That Will Drive CPGs To Adopt AI in 2024

While food retailers have been actively utilizing AI to forecast shopper behavior and streamline supply chains, the adoption rate among consumer brands lags behind. In this article, we discuss four key trends that will drive CPGs to adopt AI in 2024 and beyond.

About the Author:

Brooke Hodierne serves as EVP of strategy consulting for Insite AI. She previously worked at 7-Eleven as SVP of merchandising for the leading c-store. Before joining 7-Eleven, she held multiple positions at Giant Eagle, notably as VP of own brands.

Unlocking the Full Potential of Walmart Luminate through AI

Walmart Luminate highlights what’s happened inside the store and online like never before. Insite AI emphasizes what to do next with the data.

Walmart Luminate is a game-changing data platform that shines a light into a deep, dark data void, where no CPG has had visibility before. The platform delivers shopper insights, product performance and channel data such as pickup and delivery orders across 140 million households — weekly.

The platform is revolutionizing how brands use data to reach their consumers, but Insite AI can help unlock even more potential within the data. For example, Walmart Luminate highlights what’s happened inside the store and online like never before. Insite AI emphasizes what to do next with the data. Insite AI’s machine learning and AI models provide a forward-looking tactical layer on top of the Walmart data. Brands can see how a change in pricing, promotions or pack sizes will alter their course in the marketplace.

Walmart Luminate delivers the data. We help you put it in motion.

Walmart Luminate and Insite AI at work

Having spent nearly 20 years of my career at Walmart, most recently as the VP of merchandising in dry grocery, as well as working within bakery, personal care and other categories, I have been fortunate to see Walmart pilot and cultivate the Walmart Luminate program.

I also have a tremendous amount of experience working with brands to grow and maneuver within Walmart. I mention this, because alongside Brooke Hodierne, who was SVP of merchandising at 7-Eleven, and Capri Brixey, who was a former leader at Coca-Cola, we add a human element to the numbers. We overlay business intuition and consultation as a result of our deep and diverse business backgrounds.

With that said, let’s look at some hypothetical scenarios where Walmart Luminate and Insite AI can work together to help brands get better results.

  • Product innovation. A snack food brand uses Walmart Luminate to look at larger category trends and in the process identifies a competitive product making waves. The new challenger brand delivers higher protein content and is more affordable. In response, the snack food brand has decided to create a new line of products with 10 more grams of protein. Insite AI can help that brand forecast a range of scenarios on how a certain pack size would perform against that competitor. What pricing would work better? Would a specific promotion generate more sales at launch, and how will it be performing months down the line?
  • Brand-switching behavior. Walmart Luminate delivers a weekly report to a detergent brand that shows the detergent was out of stock in a specific region of the country. It also shows what percentage of households switched to a new brand because of the out-of-stock product, highlights what brand the households bought and shares more in-depth analysis. Insite AI can then layer in predictive market analytics around demand forecasting in consumer segments and parts of the country to help the detergent brand see where its brand loyalty lies and how to effectively respond.
  • Delivery trends. Within Walmart Luminate’s data is a look at online transactions for delivery and pickup at the store, and a beer brand, for example, can narrow in to see if there was a spike in delivery during the first Sunday of the NFL football season. What brand had the highest delivery? Which brands lagged? At what time of the day did the deliveries occur most? Insite AI can layer on the tactical to see if the trend will continue and deliver efficient forecasts on what types of promotions or moves can be made to accelerate the trend and predict when out of stocks may occur.

Factor in all the categories and shopping behaviors happening daily inside a Walmart, and the scenarios facing brands are endless. Walmart Luminate works with brands of all sizes, offering a free package with limited insights. There is a monetized version which provides customer decision trees, leakage trees and real-time insights across 140 million households.

No doubt, the data platform will grow. Insite AI will grow alongside it, working with CPGs to help solve their challenges.

Unprecedented data and insights

No other data platforms deliver a view into online delivery and pickup behaviors, giving Walmart Luminate a major competitive advantage. Before Walmart Luminate, CPGs had to rely on panel data and qualitative data sets to try and spot a trend.

But the panel data is tens of thousands of households, and the data is months old. Brands have done excellent work with panel data but it can also be tricky. The results rely on how the panel responds, and sometimes people say what they want you to hear, or the subset of people in the panel isn’t very broad, in my opinion.

Walmart Luminate offers brands data at scale, and the data presents a complete picture of shopper behaviors and households. The data withholds any identifiable information of a shopper, but it represents 140 million households across income levels and ethnicities shopping at Walmart stores. CPGs have at their fingertips truly robust data.

Insite AI can help brands take this data even further. Contact us to see how we can leverage AI and predictive analytics and help you turn insights from Walmart Luminate into immediate action.

Connect at Groceryshop

Connect at Groceryshop

Accelerate Your Sales, Revenue Growth, and Category Management Initiatives

Groceryshop | September 19-21, 2023 | Mandalay Bay, Las Vegas

Connect with Insite AI at Groceryshop and find out how our revolutionary approach can accelerate your top initiatives. Our team of AI and strategic consulting teams have walked in your shoes, giving them unparalleled insights into your industry-specific hurdles. Our Strategic Advisors are consumer brand and retail veterans from Coca-Cola, PepsiCo, Mars, Anheuser-Busch InBev, Walmart, Target, 7-Eleven, Kroger, among dozens of others.

Let us guide you in tackling your organization’s distinct challenges head-on. Through our collaborative approach, we craft a tailored solution to elevate your product assortment, pricing strategies, trade promotions, and demand forecasting.

Don’t miss this opportunity to expedite your success and lead your organization toward a more efficient and profitable future.

The Leading Partner for Large Consumer Brands

Know the precise impact of your decisions.

We’re the only partner that lets you dial in multiple scenarios, and confidently predict how they would perform on a forward looking basis against multiple KPIs, with details down to the most granular level, regardless of complexity. Make confident decisions at either the big-picture strategic or tactical level involving commercial aspects such as assortment, pricing, trade, space, and planning. In one click, foresee the results of exactly what will happen in any given scenario. Our unique capabilities take in multiple conditions and assumptions; alternatively, decision makers can rely on us to leverage the technology on their behalf. Act with extreme certainty, speed, save significant time, and ensure your actions will achieve commercial results.

Define your specific objectives, and receive new and creative ways to reach them.

Are you seeking to grow volume? Maximize prices? Grow shelf space? Improve trade effectiveness? Outperform a competitor? Rationalize spend? Our capabilities “goal seek” the exact new strategies or tactical outputs to achieve this, taking into account all of your business dynamics, beliefs, and nuances. Get multiple novel strategies that are truly implementable and actionable. Fuse your vision with our technological levers that incorporate an incredible number of factors. See the forward looking and granular articulation on the recommendation’s performance. This is something any large team of experts aren’t capable of.

Explainable assortment, space, pricing, and trade promotion decisions.

Harmonizing data and searching it for insights is old news, and few companies see value from it. We provide internal and external narratives that are defensible and truly differentiated. In one click, our capabilities explain and decompose the “why” on a forward-looking basis; and the data is presented in a powerful, immediately understandable manner. Incrementality, demand transference, price elasticities, cross elasticities, attributions, shifts, patterns, and factors affecting your existing or recommended actions are clearly articulated.


Connect at Groceryshop

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Meet our Team:

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Brooke Hodierne

EVP, Strategy Consulting

Former SVP of Merchandising at 7-Eleven, Brooke brings nearly 20 years of grocery and convenience retail experience to Insite AI. She understands what it takes to build valuable partnerships with retailers, and in her role as EVP of Strategy Consulting, she advises consumer brands on ways to elevate strategic business planning, achieve category leadership, and create optimal shopping experiences for their consumers.

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Capri Brixey

EVP, Strategy Consulting

Former leader at Coca-Cola, Dr Pepper Snapple, and Delhaize, Capri brings extensive strategic leadership experience from both retail and supplier roles in the consumer goods industry. She was recognized as a Senior-Level Top Woman in Convenience in 2022 and has also received recognition for her leadership in collaborative/joint business planning with top retailers across multiple channels and formats.

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Kristine Joji

EVP, Strategy Consulting

Kristine is a highly accomplished retail executive and former VP of Merchandising at Walmart.  Kristine led strategic initiatives that resulted in substantial revenue growth for the company across Grocery and prior to that Personal Care.  Widely recognized as a visionary leader, she played a pivotal role in optimizing Walmart’s merchandising with large CPGs.

Why Insite AI?

A Consultative Approach

Our team becomes an extension of your team. Our Strategic Advisors are consumer brand and retail veterans from PepsiCo, Mars, Anheuser-Busch InBev, Walmart, Target, 7-Eleven, Kroger, among dozens of others. Our top priority is ensuring you have the guidance and support you need to achieve your goals and maximize the value of your investment.

Most Mature, CPG-Proven Capabilities

Everyone else starts from scratch, yet Insite AI has already invested over eight figures of capital and several years into building leading edge technology; creating unmatched advantages for tackling your top initiatives.

Deeply Tailored to Meet Your Goals

We deeply tailor our engagements and fully configure our solutions to meet the unique needs of your brand. Insite AI is a true innovation partner providing CPGs with fully customizable solutions built to solve their unique challenges, enabling them to adapt quickly to changing market conditions and outperform their competition.

Navigating Uncharted Waters: How I’ve Used AI To Help Brands Prepare for Unexpected Events

AI can not only produce plans A, B and C, but also plans X, Y and Z.   

Having spent roughly the last seven years in data science at leading global brands, including Bacardi and Anheuser-Busch InBev, I can tell you that brands are too often working in “react mode.” Even at leading brands that already have an army of data scientists and AI-enabled sales and commercial teams, the organization can be challenged by events or market shifts it didn’t see coming.

During my time in the large CPG world, I saw how the brands I worked for — and competitors — reacted to economic shifts, technological changes, unexpected category product trends and more. There’s a lot that can throw a brand off track.

For any global brand looking to scale-up results or that is newer to AI and machine learning, there’s room to improve when it comes to preparing for the unexpected. There are learnings to gather that better manage product assortment, pricing and demand forecasts.

Unexpected Events Impacting Retail

The greatest and most timely example of an unexpected event is the COVID-19 pandemic, which upended all industries, but especially retail. At AB InBev, being a global company, we were able to prepare for shifts in the market and jumped to work with professors at MIT. Understandably, not all brands prioritized using data and technology to help, which has left many of them still learning from what happened.

Natural disasters are also events that can ravage operations regionally and have impacts on a global scale. But there are several other examples that CPGs may not immediately consider such as:

  • Economic crises. Sudden economic downturns, financial market crashes or currency devaluations that squeeze consumer spending and purchasing power.
  • Technological disruptions. An emergence of a new disruptive technology — or the obsolescence of an existing one — can throw a wrench into business models. Think of the advent of streaming services impacting traditional media consumption.
  • Geopolitical events. Unforeseen trade disputes, political instability or international conflicts can greatly disrupt supply chains, sourcing and trade.
  • Social and cultural shifts. A large cultural movement that causes a shift in consumer values and preferences can impact brands. It can be a sudden reaction to a brand or larger changes like consumer attitudes towards sustainability and ethical sourcing.
  • Regulatory changes. Unexpected changes in policies or legislation can disrupt business. Product label changes and safety standards, taxes and tariffs can impinge on production costs and market access.

The analysis of these events happening around the world simultaneously can greatly complicate brand strategies. Brands need the right talent in place to understand every shift occurring and how it impacts the total value chain.

Where My AI Efforts Helped Brands

It is my belief that AI’s role isn’t so much to unequivocally predict an event, but the technology can better prepare brands for unexpected scenarios. Here are five ways I’ve used AI to help protect and better manage brands during unexpected events.

1. Enable teams to run endless test-and-learn scenarios (mimicking the many events listed above). AI can not only produce plans A, B and C, but also plans X, Y and Z.   

2. Analyze historical data, current market trends and external elements to identify patterns and indicators that may precede such events. This analysis helps alert brands to the potential of unexpected events.

3. Monitor economic indicators, social media sentiment, news reports and even weather patterns, to identify any warning signals. For instance, predictive technology can detect sudden shifts in consumer sentiment or emerging global risks, such as geopolitical tensions or economic instability. By incorporating this information into predictive models, the CPGs were in a better position to anticipate and prepare for unexpected events.

4. Use technology to make snap decisions in real time to chart a new course of action for a brand and make effective moves immediately to limit any damage incurred. For example, if there is a sudden surge in demand for certain products due to panic-buying (like the toilet paper scare of the pandemic) or a shift in consumer needs (like shelf-stable foods during a storm), predictive technology recognizes patterns and quickly predicts behaviors going into and out of the trends.

5. Analyze customer behavior, such as the current downward turn in online grocery shopping or shifts in pricing sensitivity. These real-time insights empower consumer brands to adjust their production, distribution and marketing strategies accordingly.

The power of predictive technology isn’t so much to be a crystal ball, but to aid brands in delivering a collaborative and communicative relationship with retailers during challenging times.

Why Technology Is a Table Stake

The power of predictive technology isn’t so much to be a crystal ball, but to aid brands in delivering a collaborative and communicative relationship with retailers during challenging times.

I saw this firsthand through the brands I worked with, and the technology developed much stronger relationships with retailers. Brand teams can utilize retailer data and run daily reports — especially since constant communication during major events is extra important. These insights can help retailers optimize their inventory management processes and place core, valuable products onto shelves and maintain stockouts.

Data-driven capabilities and AI can be a necessary assistant during unexpected events. The tools can support how crisis teams manage unforeseen events.

The ability to provide data-driven recommendations and support helps build trust inside and outside an organization, and improve operational efficiency. The learnings also guide brands to weather any storm and better expect the unexpected.

To learn more about how Insite AI can help brands mitigate unexpected events, contact us.

Fueling Growth: AI Unleashed in the Energy Drink Industry

Whether its volume, shifting brand loyalty or cross category migration, retailers need to know what will happen next—not yesterday–to maximize profits in valuable selling space. 

The energy market has evolved considerably over the last 30 years. While many suppliers have disappeared, the number of new entrants continues to rise. With increased competition and what seems like constant innovation, consumer preferences and shopping patterns continue to evolve with the category. Without infinite space,  retailers are under pressure to design the optimal assortment with the best combination of SKUs, flavors, brands and package sizes to maximize selling space and win the most consumer dollars. 

In six months, the landscape for this rapidly evolving segment may look dramatically different. Whether its volume, shifting brand loyalty or cross category migration, retailers need to know what will happen next—not yesterday–to maximize profits in valuable selling space. 

A Profitable Segment

Constant category changes can make it challenging to stock the right SKUs. In addition to the continual bombardment of new products and suppliers, Covid-era shopping patterns have shifted back to normal. With only a handful of brands having long-term staying power, retailers continually ask themselves, “How do I balance my assortment of core brands/flavors with new ones?” and “How many cooler doors do I utilize for energy drinks versus other beverages?”

Choosing the right size cans and multi-packs is another dilemma. During Covid-19, purchasing of multi-packs and larger pack sizes increased as more consumers drank beverages at home. Today, retailers must meet the needs of changing consumer mobility patterns, with increased shifting purchasing behaviors between immediate consumption to at home consumption. While in-line square footage is a bit flexible, cooler space is fixed.

AI can help indicate what flavors, package sizes and formulations will resonate with certain groups.

Demanding More Space

The growing energy drink industry continues demanding more square footage. But brands must “prove” their entitlement. Traditionally, suppliers used historic data to make predictions. But, more so than most other CPG categories, the energy drink market is in a constant state of flux, making this data seriously unreliable. AI tools use real time data, allowing vendors to more accurately predict how many items will sell in what space and which will perform best moving forward versus looking backwards. 

AI can provide a granular level of clarity around purchase decisions and consumer preferences. As the energy segment evolves with added need states, functionalities, and more, understanding the ‘why behind the buy’ becomes crucial for achieving long-term category success

Consumers’ preference for new brands and formulations versus legacy brands varies by store, channel and demographics. AI can indicate which shoppers stick with tried-and-true labels and which ones are more adventurous. Using data points to form useful insights, AI can help indicate what flavors, package sizes and formulations will resonate with certain groups.

AI’s ability to track shifting purchasing patterns yields data that can dramatically impact suppliers’ go-to-market strategies. When brand is not the primary motivator, it can help retailers avoid duplicating similar flavors, package sizes and formulations. Consequently, space becomes more profitable.

AI can predict which shoppers will remain loyal to energy drinks and which will not.

The Right Price

Over the past 18 months, cost increases have impacted almost every consumer category. While products must be profitable, brands must clearly understand the impact raising prices can have on shopper demand. AI can help. If the everyday retail price increases from $2.49 to $2.69, for example, AI can clearly project new sales volume. AI can also compare pricing to that of competitors. This helps retailers assess consumers’ sensitivity to particular prices, including associated risks. This is a win for both supplier and retailer.

Technology and modeling strategies can cross categories. The increased consumer need-state for Energy has caused a surge of other cross- category entrants in the added caffeine space. Where typically, brands focused on hydration benefits, we see more brands entering the space. But some newer items contain high caffeine levels, blurring the lines between categories and threatening energy drinks’ market share if energy drink prices go too high. 

AI can predict which shoppers will remain loyal to energy drinks and which will not. It can also determine what this means to the vendor’s base business and how the vendor can protect and defend its energy space. 

Immediate Consumption vs. Planned Purchasing

As consumer household penetration for Energy drinks continues to grow, developing broad brush pricing strategies for all channels from a historical POV will limit opportunities. Some retailers are losing traffic. Higher prices are prompting many consumers to plan purchasing online or in discount, club and grocery channels. These purchases frequently involve more economical multi-packs. Data and predictive modeling can track cross-channel migration and associated purchasing behavior. And it can do so down to the individual flavor, ingredient profile, brand and package type level.

Conclusion

In the dynamic world of energy drinks, AI holds the key to success. With the market ever-evolving and competition intensifying, the optimal assortment is crucial to attract customers and maximize profits. AI offers real-time data to predict consumer behavior, helping brands to make informed decisions on SKUs, flavors, and pricing. By discerning brand preferences, tracking shifting patterns, and unlocking cross-category insights, AI elevates strategic planning to new heights.

Embrace the AI advantage to secure lasting success in this dynamic landscape. Contact Insite AI.

Why Are CPGs Still Making Multi-Billion-Dollar Decisions Using Spreadsheets?

“Mainstream media and technology companies have made the topic of AI so confusing to the point that it now seems too conceptual and risky to adopt.”

Many CPGs still rely on the trusted yet limited capabilities of spreadsheets as primary tools for assessing and taking action on assortment, trade spending, space and promotions planning. While effective for certain applications, spreadsheets were invented in 1979; Excel was invented in 1985. These are not intuitive or enabled tools that can provide the timely, precise details required to make multibillion dollar decisions. With the retail landscape moving faster than ever, it is time to break free from the constraints of spreadsheets and leverage the transformative power of 21st century technologies. The future belongs to those who embrace innovation and adapt to the evolving industry landscape.

Limitations of Spreadsheets

Relatively easy to learn and use, spreadsheets are a popular option for conducting data analysis among CPGs. They offer a familiar and accessible interface for handling data, performing calculations, and creating visualizations. However, when it comes to fast decision-making in the dynamic world of consumer brands, spreadsheets reveal their limitations. While they can handle considerable amounts of data, they can be slow and unstable, particularly when data is complex. Spreadsheets further struggle to efficiently process and consolidate diverse data sets, leading to manual efforts (heavily reliant on already limited human resources) and potential inconsistencies. Excel can also impede collaboration and sharing at a time when there is more data than ever before to leverage. The bottom line is that spreadsheets are not intuitive and they require human intervention for use and to create value.

Market Volatility

Organizations are constantly trying to evaluate market volatility, competition, emerging markets and channels, and consumer behavioral shifts to assess where to allocate resources. Not having the right products and package sizes in the right place at the right time with the right price results in lost sales opportunities. If performance data shows gaps to targeted objectives, the organization will spend the year working to re-assess remaining planned actions and investments. This makes dependence on historic data troublesome. The gap between the “look back” and the “look forward” is a missed opportunity, especially in light of the market and supply chain volatility of the past three years in the CPG industry in particular.

Modern Approaches          

Today, purpose-built CPG-tailored software can ingest billions of data points from disparate sources to assess category maturity, predict future performance and assess the value of investments, allowing brands to appropriately allocate resources. It can also make more precise financial predictions. If resources are not allocated properly, expected results are not achieved. The resulting “gaps” can take a long time to close. Spreadsheets simply indicate what those gaps are; they do not indicate how to solve them. They can only hold data.

CPG-tailored technology uses timely data to project into the future, reducing dependence on historical data alone. Unlike spreadsheets, CPG focused software can “learn” from repetitive patterns and algorithms; it does not simply report data.

CPG-specific software with modeling capabilities uses multiple data sources in real time, incorporating everything from product sales and gas prices to labor department data and demographics. Because their models (accelerated by different prediction, product and pricing engines), are continuously finding data points and learning, they are able to provide forward-looking and prescriptive insights. It can signal package optimizations–e.g. whether there should be more gallon sizes of milk in a particular store versus single-serve cartons. The technology also finds those “needles in the haystack” that can be key differentiators from one store’s assortment to the next. By allowing all data to work together, teams can respond swiftly to market changes and adapt strategies dynamically, providing a competitive edge in a fast-paced industry.

Collaboration & Pinpointed Goals

Moving beyond spreadsheets enables greater collaboration and agility. Cloud-based platforms and data-sharing technologies have begun to facilitate seamless communication across departments, breaking down silos and fostering a collaborative culture. As part of that evolution, good software can facilitate better annual business planning, factoring in supply chain, labor and other costs into input assumption fields. The beauty of this is that it gives visibility to everyone in an organization and makes highly accurate predictions. This elevates target-setting, breaking out targets by function. It measures and compares achievements and lets retailers and suppliers work together to meet goals. Retailers and CPGs can then enable the Joint Business Planning process with these same powerful tools and more collaboratively agree upon a set of metrics and activities that will achieve aligned business objectives that are very specific to categories, investments or activities. Progress against all objectives is part of the modeling, constantly assessing and improving accuracy of predictions, reducing or eliminating the replanning that results from gap closure and volatility.  

Lack of Trust & Familiarity with AI

Mainstream media and technology companies have made the topic of AI so confusing to the point that it now seems too conceptual and risky to adopt. Despite evidence to support the use of AI, its effective application to broad data sources and existing processes is still nascent in the CPG industry. Just 11% of CPG organizations have adopted ML/AI tools. This stems from various factors, including concerns about the accuracy and reliability of AI algorithms, and a lack of clarity on how to apply the forms and functions of AI models to existing business processes.

There is tremendous efficiency to be gained using technology over spreadsheet, regardless of whether it incorporates a little AI or a lot of AI. Good software does not necessitate adding people (nor replacing people) to make that happen. It’s a small investment compared to what the returns can be when technology is used to augment teams and enable them to act with exponential speed and precision. Any returns can be high with clearly measurable objective-setting and ROI.     

Conclusion

The move away from spreadsheets is not just a call for change; it is an opportunity for growth and innovation. By embracing cutting-edge software and analytics, the full potential of data can be unlocked, allowing CPGs to make informed decisions and drive sustainable business growth. The time to act is now, as the CPG landscape continues to evolve rapidly. Those who adapt to change will be the ones to thrive and capitalize on the transformation opportunity.

To learn how you can evolve to be a more agile and AI enabled company, contact Insite AI.

Beers & Sunshine: How Brewers Can Lead the Season Through Assortment and Space Elasticity

How a national brewer optimized and cultivated a successful assortment in the craft beer category, increasing revenue and market share

The most important months for alcohol sales are underway. From Memorial Day to Labor Day, retailers see the largest percentage of sales in beer and alcohol. To capitalize on that demand, however, retailers rely on their beer partners to deliver the most profitable assortment available.

The craft beer sector can be one of the most complex categories, requiring a retailer to choose among hundreds of unique breweries local to their stores; then there are thousands of regional breweries and national craft companies. Next, how many IPAs should be carried? What about sours, stouts, pilsners, maybe a gose with hibiscus or a near-beer pale ale? How many four-packs, singles or cases? Cans or bottles? The options are seemingly endless.

Factoring in the importance of the summer — the National Beer Wholesalers Association ranks the top three beer holidays as Independence Day, Memorial Day and Labor Day — retailers need powerful insights that deliver reliable visibility into seasonal trends like summer.

Beer brands need to help retailers measure the price elasticity of craft beer in the summer and perfect assortments to take advantage of summer habits, trends and taste profiles. Insite AI and precise predictive modeling can set brands up to lead the way. 

In this blog, we explore further through a national brewery client that optimized an assortment for two national specialty retailers, resulting in an increase of sales of nearly 3% for the craft beer category, growing annual revenue by $20 million.

Understanding the Complexity of Craft Beer

Year after year, the total number of craft breweries entering the U.S. market continues to climb. But is there enough space for them? Or, better yet, how can we truly expect a retailer to know what to put on the shelf or in the cold vault? 

In the problem of too much beer, we worked with a national brewer to optimize assortments at two national specialty retailers, one with 300 stores and another with 500. As a result, it was the first time the national brewer had been awarded a category captaincy to help rein in and optimize assortments. 

For both chains, the brewer helped make the most out of the retailers’ craft beer shelf space, something incredibly important for the big four months. The National Beer Wholesalers Association has reported summer beer sales represent anywhere from 20-40% of a company’s sales.

Driving Revenue and Market Share

Working with the national brewer, we leveraged AI-powered predictive analytics at a store-by-store level, as opposed to store clusters.

Every store came with unique space constraints and localized options to consider. With Insite AI, the brewer was able to take multiple sources of unstructured data and deliver granular insights to help the brand forecast performance over a two-year period. Insite AI deployed targeted assortment capabilities inside the brand’s cloud environment to analyze key data points across multiple retailer accounts. Insite AI then applied sophisticated models that delivered visibility into areas of growth and decline, and predicted innovation trends. 

They quickly delivered critical insights on demand transference. The platform highlighted the incrementality associated with new products to add to an assortment, suggested what to remove, and looked at other market factors.

For the national brewer, the modeling led to huge success for the two retailers, generating:

  • A 3% lift in sales above “business as usual.”
  • $20 million in annual revenue increases for the retailers. 
  • Significant market share gain.

These numbers are significant for a category where retailers are looking to pull back on inventory and players in the space. It is more important than ever for brands to become trusted and credible thought partners to their retailers with business planning and decision-making.

With Insite AI, the brewer can now create multiple assortments within seconds and recommend the best one for its retailer partners. Alongside the consulting engagement, they provide an AI model that is continuously learning so brands can deliver updates to optimally run the category and maintain a captainship.

Building Better Assortments

Brands across the CPG space can refine and optimize assortments, space planning and trade promotions through AI modeling. Machine learning distills the months of manual work required to understand movements and trends within a category to minutes. AI serves as an accelerant to internal teams and ways of working.

Insite AI can help brands create stronger relationships with retailers through predictive and precise technology that brings clarity to complex categories like craft beer.

To see how AI can lift your brand, contact us here

Seeing AI Through a Practical Lens (Featured on C-Store Dive)

Guest article featured on C-Store Dive. See full article.

There’s a lot of noise around AI and what it can or cannot do. In this article, Brooke Hodierne, former SVP of Merchandising at 7-Eleven explores the practical applications and challenges of implementing AI in the convenience store industry. She discusses the potential benefits of AI technology and emphasizes the importance of aligning AI initiatives with actual business needs and objectives rather than pursuing AI for its own sake. She also addresses the obstacles and skepticism faced by businesses, highlighting the need for realistic expectations and understanding AI’s limitations.

About the Author: 
Brooke Hodierne currently serves as an EVP – strategy consulting at Insite AI, an AI and strategy partner for larger consumer brands. She joined the company following her time as SVP of merchandising for 7-Eleven. In the role, she drove category management teams that developed, implemented and communicated merchandising strategies for vault, packaged goods, tobacco and services.

Before joining 7-Eleven, Brooke held multiple positions at Giant Eagle, serving as VP of own brands, senior director of strategic sourcing and own brands, and director of prepared foods merchandising. She supported brand marketing at Del Monte Foods and held analytical roles with financial investment firms Wilshire Associates, Federated Investors and the Vanguard Group.

The CPG’s Guide to AI

Empowering Consumer Brands with Clear and Actionable AI Insights

Research confirms leading consumer brands who harness the value of consumer insights and artificial intelligence (AI) better predict the needs of their customers, improve category performance, accelerate growth, and outpace the competition.

72% of executives consider AI as a business advantage

But how can you get started? With data overload, an abundance of options and unclear direction, many companies opt to do nothing. This is no longer an option. You will be left behind. Armed with the right data, AI-driven CPG brands are working hand in hand with their retail partners to better meet consumer demand. By turning mounds of overwhelming data into actionable intelligence, these CPGs are scoring big with retailers and end consumers alike.

In this guide:

  • Demystifying AI
  • How consumer brands can leverage AI today.
  • Top 5 AI/ML Use Cases in CPG
  • Going beyond Power BI and advanced analytics
  • Making the case for AI in your organization
  • Top questions to ask for a fruitful AI journey

Harness the power of AI to ensure you have the right products on the right shelves at the right time. Download this guide to begin your AI journey toward becoming an AI-driven, category-leading consumer brand.

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