IRI CEO: ‘Harnessing power of data’ is vital
At the recent IRI Summit, IRI president and chief executive officer Andrew Appel outlined the company’s comprehensive “Growth Delivered” business strategy designed to drive revenue growth acceleration across the sales and marketing operations of consumer packaged goods manufacturers and their retail partners.
But before developing the plan, Appel, who joined IRI in June 2012 after having held a number of senior leadership positions for Chicago-based professional services firms, sought out the insights and opinions of leaders in the CPG arena as well as those from other industries.
“He noted that in his first 10 months as CEO he met with over 500 executives at about 100 CPG and retail companies and more than 30 CEOs from peer companies as well as IRI colleagues to make certain the company has the right people in the right positions and that they have the right resources to help IRI and its growing list of clients.
The goal, he said in an interview, was to “shake out an emotional feel” for the industry. Much of the input gathered by Appel during his “listening tour” helped create “Activate Your Growth Engine,” the theme for this year’s conference, which was attended by an estimated 1,200 CPG manufacturers and retailers and at which the company rebranded to its founding name of IRI.
During his listening excursion Appel noted that he harbored no preconceived ideas of what he might hear but stressed to those he met that IRI would continue to focus on providing clients with “data and insight that matters,” emphasizing how such information can be used to
strengthen their business.
Understanding how to use that data will take on even greater importance in the future — a factor often referred to by Appel in his remarks at the Summit’s opening general session. “Big data is here,” he said. “Big data technology and services will reach $17 billion by 2015 from just $3 billion in 2010. IRI has a unique ability to integrate and activate all this data. We have an unprecedented opportunity to create clarity out of this chaos.”
To accomplish this objective, he cautioned, market research must evolve from its image as a cost center to one of a growth engine. “Harnessing the power of data will separate the winners from the losers within the next five years,” he predicted. Appel stressed that IRI, with the support of New Mountain Capital (a private equity firm that serves as its ownership group) has the people, programs and partnerships in place to help the industry meet the challenge of utilizing data to deliver growth. He pledged that IRI would continue to get the basics right and to spend most of its time looking forward proactively; that it will continue to invest in end-to-end technology solutions that support the core processes of clients; that it will provide those clients with big data for growth through realtime analytics; and that, internally, it will invest in the tools and training of IRI staff members so that they can “interpret the data, understand its implications and drive action.”
Appel noted that, like many companies represented at the conference, IRI is looking toward so-called emerging countries for growth. “For us it will start with China,” he commented. “Consumer purchases around the world are expected to grow from 8 trillion to 12 trillion between now and 2020; China represents $1.7 trillion of that, so it’s a natural place to start.” Along with the bombardment of data has been the digital and social media explosion and its impact on CPG manufacturers and retailers. Appel noted that a quarter of CPG purchases are influenced by either online or mobile activity (up from 19% two years ago) and that nearly three-fourths (73%) of today’s consumers use smartphones while in stores to compare products and prices. Likewise, he pointed out that digital ad spending is forecast to grow from 20% this year to 25%by 2016. “Five years ago it was 1% to 2%,” asserted Appel. “The consumer is now in control: The digital revolution has forever changed the consumer’s path to purchase.”
Early in his remarks Appel advised his audience to embrace change or risk becoming irrelevant. And although the company has undergone changes itself, he noted that IRI’s pledge of delivering new vehicles to drive growth for its clients is really a reflection of its past. “‘Growth Delivered’ is not just a future concept or theory that we’re looking to use down the road, rather it is an acceleration of what we’ve been doing for years.”