Nielsen and JD.com bolster retail pricing and promotions

Nielsen has partnered JD.com on a strategic cooperation and data sharing agreement. Based on the agreement, both sides launched an innovative big data product called the online pricing optimiser (OPO).This product will help brands evaluate its pricing on the JD platform, optimise its promotion and assist in customising year-round promotions and designing plans for certain eCommerce festivals. As such, brands are able to increase its sales and profit margins on the JD platform. OPO aims to help brands better understand the online consumers, such as the comparisons shoppers take before making a shopping decision, the proportion of different promotions in the overall discount as well as the impact of each discounts on consumer shopping decisions.Based on an analysis of pricing and discounts, OPO provides suggestions for long-term and short-term pricing promotions. Developed by Nielsen's analytical consulting department and JD's business development and cloud platform units, the product leverages the order and browsing data generated by more than 300 million active online consumers on JD, as well as Nielsen's monitoring data on omni-channel retail.OPO can also analyse all the factors influencing consumer decision-making at different level of the pricing and promotion strategies. It can restore consumers' shopping decisions, find the key factors that drive sales through pricing and promotion, give professional suggestions that can be executed, thus enhance the brands' promotional efficiency on JD platform.According to Nielsen's research, Chinese consumers have been increasingly sensitive to pricing in recent years. In addition, the study said that product pricing influences not only brand owners' profit margin, but also the possibility for brands to open a market and activate the needs of the target population.As smart phones are popularised, digital lifestyles have gradually penetrated new retail and channels are becoming more apparent. As such, the study said that eCommerce will be embraced by more Chinese consumers. An increasing number of consumers are getting used to online shopping, while the shopping channels are also surging. With the help of JD cloud platform's fast data processing capability, Nielsen fully integrates its global expertise in pricing and promotion techniques.Andy Zhao, president of Nielsen China said that OPO is designed based on Nielsen's traditional pricing and analysis product, while also combining individual order data provided by JD platform. By creating OPO, he added that Nielsen pioneered the way that using consumer order data to provide pricing and promotion analysis for brand owners.According to Zhao, China's retail industry was competitive last year, when many companies with poor management closed down. Growth models driven by the online clicks and investment gradually failed, he said, adding that Nielsen then understood the importance of precision marketing."For either online or offline retail industry, the most fundamental law is to respect and understand consumers. Chinese consumers are having more diverse demand, getting more sensitive to pricing and more complex in decision-making process. By using scientific data tools, brand owners can see a pattern, and come up with strategies that serve consumers and realise long-term healthy growth," he said."Ecommerce pricing and promotion products available on the market often use store-level data as the basis for analysis, which is limited by the third party's data collection technology and the relations with e-commerce platforms. But this attempt ignores the fact that behind online stores, customers are changing extremely fast," Zhao added. He also said that Nielsen found the accuracy of eCommerce analysis and predictions made based on store-level data stands at only about 25%. In contrast, the forecast accuracy by Nielsen's OPO, which using data on individual order level, can exceed 75%.Yan Weipeng, vice-president of JD said that retail has no boundary, neither the development of retail industry. "Win-win cooperation will always be the trend of retail sector. JD is very pleased to work with Nielsen and brand owners to find out growth engines, promote GMV growth among JD and brand owners, and create a multi-win situation. Our partnership with Nielsen has a long history. Whether it is MTA (Multi Touch Attribution) or OPO, the Nielsen team's professionalism made a profound impression on us. We believe OPO will bring tremendous value to JD and the entire industry," he added.