In the race for performance, access to the right information is crucial. This not only applies to performance and your market trends, but also to the performance to competitor performance as well as all players in an ecosystem. However, to collect this data and use it efficiently, the scope for an analysis in line with your objectives must be defined. Panels can help you to do this! Whether private or independent, they can be great tools to boost your strategy. How do they differ and how you should choose the one that best suits your business objectives?
Private panel versus independent panel: what are the differences?
The private panel, a targeted analysis
Based on the initiative of a tire manufacturer, a private panel only covers a sample of its customers. Most often including direct customers, it provides information on inventory and the sales made with its brand's products. The manufacturer defines the scope of this collection itself. In practice, it asks participants (usually wholesalers or major networks) to report sales made within its customer portfolio, as well as stock of its own brand products. Based on this information, the tire manufacturer has visibility to sales of its brand and can assess the performance of its references. Objective: optimize its production and adapt its sell-in offer.
The tire manufacturer will gain visibility of its own performance in the market of registrants. It may also have access to its distributor’s performance through sales of competitive manufacturers. However, the latter will be available in an aggregated form, with no details.
The private panel represents a contractual commitment with a definite, but potentially limited interest, since it only provides the tire manufacturer with visibility of the segments in which it is involved. Therefore, this panel may miss market trends or may only have a partial view and miss certain opportunities. Setting up a private panel is a good way for a manufacturer to obtain a very precise view of its own performance in the market, its distribution network, or partner network.
With this tool, the tire manufacturer can quickly implement strategic actions:
Optimize its product catalog and its production capacity.
- Bring its brand’s sales policy in line – do distributors follow the defined guidelines (sales price, product mix, etc.)?
- Measure the impact of trade marketing actions - have campaigns met the objectives set, or should they be prolonged or adapted?
Data available for tire manufacturers for its own brands
- Total sales volume by distributor (or sell-out distributor for the brand)
- Aggregated volume for all brands
- Detailed volume by product and segment established with customers
- Geolocalization of sales
- Inventiry level
- Sales price
The independent panel, a broad view of the market
Built from the initiative of the panelist, this type of panel fills a need for all players involved in the ecosystem. The role of the independent panel is to provide an all brand vision of sales in the market studied. Details of sales are not given by the distributor. This panel offers a more complete vision of the competitor's behavior, the market and the different distribution channels, which allows major trends to be assessed.
With an independent panel, the tire manufacturer can find out how many of its benchmark products have been sold by the distribution network in the market studied. It benefits from an overall view of the market segments, which allows it to assess those that perform better globally and those with a specific brand. It can thus measure the performance of its brand’s products, that of its competitors and also the different distribution channels.
Data available for the tire manufacturer
- Performance of distribution channels (overall sales volume, market share by channel, etc.).
- Average sales price (by channel, segment, brand, etc.).
- Sales volume and changes within the scope of the panel registrants.
- Performance of brand products compared with competitive brands in the global panel (sales volume and product market share, etc.).
Remember: the distributor will have access to the same information and performance indicators as tire manufacturers. It will also have a visibility of its performance compared with the global panel, as well as the performances by brand and by channel.
To read also: [Use Case] Understand the tire market for all ecosystems
3 challenges facing the panelist on an independent panel
Within the framework of an independent panel, the information sent by the panelist to the different players is made anonymous. In this way, tire manufacturers only have access to market sales through the channel that made the sales: specialist dealers, car dealers and fast-fitters, car manufacturer networks, pure players etc. So that no-one with access to panel data can deduct which distributor made the sales, it is recommended to include at least three distributors per sales channel.
The coverage rate
The market coverage rate of a panel can be calculated in two ways: either by setting the overall sales of the panel against the estimated market sales, or by comparing the number of declaring sales outlets with the estimated number of sales outlets on the market.
A minimum rate may be expected so that the panel has a minimum value and can be considered as representative. The distribution channels which contribute most must also be represented.
In the tire market, distribution is not homogeneous, due to the very broad typology of distributors. Extrapolation may prove to be hazardous.
Processing collected data
The panelist is positioned as a trusted third party. He/she is in charge of processing the exchange and organization of the data to provide participants with the right level of information.
The panelist collects, processes and analyzes the data after defining the scope of the analysis (distributors, level of the supply chain, online or offline sales, etc.). Entrusting the creation of your panel to an expert allows you to benefit from a third party that is required to ensure the confidentiality of the collected data, particularly as part of its anonymity.
Registrants must ensure that a non-disclosure agreement for data (especially your market share) is established with the panelist.
Providing specific business information can be a sensitive matter for the distributor. Yet, a clear vision of the market behavior is essential for all players in the ecosystem. Lizeo is a trustworthy third party, and an expert in the collection and management of data. Would you like to know more or discuss your problems to assess the performance of your market?