Wal-Mart Walks Away from PRISM

Discussion
Dec 29, 2008

By Tom Ryan

While Wal-Mart supplied
shopper data for the pilot, the retail giant will not participate in the
expected launch next year of the P.R.I.S.M. national retail data syndication
service from The Nielsen Co.

"Wal-Mart was pleased
with the insights they gleaned from the PRISM pilot," a statement from
the Nielsen Co.’s In-Store division read, according to Promo Magazine.
"However, they have decided not to participate in a national syndicated
service, remaining consistent with their internal data-sharing policies."

Nielsen added that Wal-Mart’s
decision not to subscribe to the service will not affect the launch of
the in-store data service, and noted that 15 of the retailer members plan
to take part when the data service rolls out. It added that Wal-Mart’s
decision was not a reflection on the quality of the shopper data produced
in PRISM’s pilot phase.

"Wal-Mart acknowledges
the industry value of the national [P.R.I.S.M.] service and the quality
of the service provided to those participating," Nielsen said.

Product manufacturers
including Procter &
Gamble, Unilever and Kraft Foods have agreed to take part in the data service.

"We remain optimistic
about the Nielsen In-Store measurement service and continue to support
the vision of a common industry metric to measure consumer reach in-store,"
said P&G associate marketing director Ann Mooney, in the statement.

P.R.I.S.M., the acronym
for "Pioneering Research for an In-Store Metric", examines point-of-purchase
reach by department and links sales display impressions to sales conversions
in an effort to help retailers and manufacturers make better merchandising
decisions.

The service began in
April 2007 to amass in-store data from 30 product makers and 16 retailers,
including shopper traffic, POP, merchandising programs, retail TV networks,
shelf- and cart-talkers and digital signs. The intent is to arrive at a
measurement system that will permit a side-by-side comparison to other
media advertising.

In an editorial on instoremarketer.org,
Bill Schober, editorial director at In-Store Marketing Institute,
wrote that while he wasn’t shocked that Wal-Mart opted out of the national
PRISM launch, he was a "little disappointed" that Wal-Mart would "just
walk away from such a promising project."

Mr. Schober noted
that when Wal-Mart stopped providing POS data to syndicated market research
firms in 2001, it launched Retail Link to share internal data with suppliers.
He suspects a similar Wal-Mart program will eventually be launched around
its in-store metrics.

Mr. Schober concluded,
"P.R.I.S.M., meanwhile, will soldier on with all of the other original
consortium retailers as well as a lot of blue-chip CPGs such
as P&G, Kraft and Unilever. And we’ll keep cheering for it from the sidelines,
because as far as this magazine is concerned, P.R.I.S.M. represents the best
methodology yet devised for reaching the ultimate goal, a practical in-store
metric."

Discussion
Question: How much does Wal-Mart’s pull-out impact the rollout and overall
value of the PRISM in-store data service?

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7 Comments on "Wal-Mart Walks Away from PRISM"


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Ed Dennis
Guest
Ed Dennis
13 years 4 months ago

What good is it if the largest retailer in the world isn’t included? This is especially true with branded food items. I guess Walmart has a system in place that allows them to get all the information they need to manage space and inventory.

Herb Sorensen, Ph.D.
Guest
13 years 4 months ago
This may seem extreme, but I often characterize the store as a black box, to both retailers and brand suppliers. This is driven by their nearly total lack of PROCESS data, and their own economic marriage. In this circumstance, it’s easy for a retailer to “give away” process data to a common pool, for the industry to paw through–and pay the retailer even more. As retailers themselves become more sophisticated in understanding process, as opposed to input/output, they will find gold there, far beyond any in-store media metric. Strictly looking from the outside, it is apparent to me that Walmart first came to this conclusion with their in/output data years ago, and now are following suit with a proprietary approach to process data. From the viewpoint of having married process to input/output data on millions of shopping trips over the past eight years, I would say that the major advances in retailing, already emerging here and there, will come from this marriage. I don’t see cutting edge retailers sharing the keys of the kingdom. There… Read more »
Jonathan Marek
Guest
13 years 4 months ago

This can’t have been unexpected. I wonder whether this was the outcome Walmart had been driving towards from day one. Learn as much as possible in a pilot, then drive off on their own.

Lisa Bradner
Guest
Lisa Bradner
13 years 4 months ago
Walmart’s pullout is not surprising given their partnership with DSIQ. As it did with Retail Link, Walmart has found a way to provide more specific actionable data that gives it a competitive advantage rather than participating in a shared data pool that benefits multiple players. PRISM’s data methodologies have always, in my opinion, had some fatal flaws because they focus on impressions and store traffic rather than specific conversions to sales. While this was a necessary approach given the consortium of competing manufacturers and retailers for in-store media to truly take off, a more direct link to sales needed to be established. The big question here is, who goes forward with what? Clearly Walmart views the DSIQ data as a competitive differentiator and is willing to invest in the data (as they have in the past). Others will need to decide whether syndicated data takes them far enough or they need the more expensive model. For the foreseeable future we’ll see the competing models play out. The ultimate question to me is, how do retailers… Read more »
Carol Spieckerman
Guest
Carol Spieckerman
13 years 4 months ago

Wal-Mart’s PRISM pullout can’t be minimized; it’s a grave disappointment to the other participants in the beta. And, just as Wal-Mart’s absence from syndicated data leaves a gaping hole to this day, so will it as PRISM marches on without the world’s largest retailer.

From the start, Wal-Mart was quick to say that they weren’t taking a leadership role in PRISM (which of course they could have) but instead were participating equally with others. With Wal-Mart’s paradigm-changing Smart Network rolling out, and unprecedented in-store insights due to roll in, I can completely understand why Wal-Mart would close the Kimono once again. Why would Wal-Mart volunteer to make its solid first-mover advantage honeymoon more fleeting?

David Biernbaum
Guest
13 years 4 months ago

Using any type of data to interpret and evaluate consumer sales needs to include Walmart in order to be accurate and totally meaningful. Most of the industry has been using IRI and Nielsen data without Walmart, however for most product categories, the tracking results are virtually senseless for Mass, or now even for F-D-M, unless the users create an estimated projection of results based on Walmart’s ACV and share of the market. Not accurate, but any results without Walmart do not hold a lot of value unless a given product would not likely be sold significantly at Walmart.

The “problem” is that Walmart reaches not only such a gigantic share of the consumer market but also that it’s so widespread across so many demographics and regions.

Camille P. Schuster, Ph.D.
Guest
13 years 4 months ago

Walmart doesn’t allow its POS data to be part of syndicated research services; Walmart created its own data warehouse. As the industry works toward standardization and collaboration, Walmart stays abreast of the developments, participates in pilot studies, and then develops its own separate system.

When and if Walmart decides it wants to collaborate with the rest of the industry, there will be a good deal of lost trust to rebuild.

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