You are a Senior Consultant working a boutique management consultancy firm that is recognized for its ability in helping FMCG and Pharma companies analyze sell-out data. One of your customers wants to launch a new hair color product, and needs to understand the market better. You have been given a detailed dataset with a few years of sales (to run the analysis, type "sell-out hair color" in the app.).
Sales variance analysis
See aggregated sales variance or split variance between its components (volume, price, mix, drivers,..).
Overall, in the last 12 months, the market has remained relatively flat.
In fact, not much has been happening to the market on the aggregate in the last three years.
See how a metric, here revenue, interacts along a pair of dimensions, here product type and company.
Multi-tier bar chart
See how a dimension - here company - plays out in the two periods on a metric - here amount.
...and is growing at twice the market rate.
See how a dimension - here type - plays out in the two periods on a set of metrics - here amount and units.
Permanent lost ground, Temporary did well.
Permanent has been loosing ground for years.
The loss of Permanent sales seems to be easing in the most recent months.
The share among retailers remained stable and,....
...with the exception of Costco, that has lost some ground, has not changed much.
All retailers benefited from the positive market dynamic of the most recent month.
Popular colors in the permanent segment often lost sales...
...while "new" colors are gaining ground.
Dark Brown and Light Blonde performed better in the most recent month.
L'Oreal gained share, Coty suffered.
A few of the top brands lost ground, especially Nice N Easy...
...that has been weak for some time.
Nice N Easy, loosing ground the whole year with the exclusion of the most recent month...
...negatively impacting on Coty.
There is a negative price pressure on the market.
However the average price did not change between the two periods...
....keeping the same distribution...
At the Type level, the average price of Permanent products did not bulge
Mix variance is positive, meaning that customers have moved towards higher ticket products.
Growth is driven by "new" offerings (new products or old products offered in new retailers).
The distribution has gone down considerably, but has been more than offset by higher sales by POS.
FIRST RESULT COMBINATION
Variable dimension variance analysis helps understand better where the "action" is. Here is a breakdown by aggregated variance.
- Coty Company products lost 10% of its sales (-5.4M)
- Temporary Type products doubled their sales (+3.8M)
- A "Root" product also doubled its sales (+3.1M)
- The remaining "Permanent" products remained stable with the exception of "Feria" that lost 80%.
The first waterfall draws attention to what arguably are three key developments in the market: (i) loss of Coty sales, (ii) growth of Temporary products, (ii) success of Magic Retouch offering.
FIRST ROW RESULT DETAIL
Here is the drilldown of the first result row cohort (-5.4M).
The following charts plot the data of the first result row cohort (-5.4M) along the different dimensions.
SECOND ROW RESULT DETAIL
Here is the drilldown second result row cohort (+3.8M) along the different dimensions.
The following charts plot the data of the second result row cohort (+3.8M) along the different dimensions.
THIRD ROW RESULT DETAIL
Here is the drilldown of the third result row cohort (+3.1M).
The following charts plot the data of the third result row cohort (+3.1M) along the different dimensions.
PRICE AND VOLUME VARIANCE
SECOND RESULT COMBINATION
Variable dimension variance analysis helps understand better where the "action" is. Here is a breakdown by price and volume variance. Three out of four millions of negative price variance come from Permanent.
The second waterfall details volume and price variance. It draws attention to the growth of L'Oreal and the loss of Coty, but also to the general loss of price in Permanent.
THIRD RESULT COMBINATION
Both L'Oreal and Coty reduced prices.
Finding patterns in data
'Mparanza uses variable dimension variance to help find patterns in the data that could be missed with a traditional slice and dice approach.
The third waterfall filters all instances of price variance, and therefore leaves a 6M unexplained variance residual. Both L'Oreal Permanent and Coty have suffered from soft prices and have been rewarded with unchanged or weakening sales. Henkel Live increased prices and grew sales.