IR professionals may find themselves at a disadvantage during quarterly earnings discussions if they don’t have as firm a grasp on performance trends of similar but competing companies – or whole sectors – as their investors and analysts do.
That’s why it’s a good time for IR professionals to make a New Year’s resolution to access the kind of data that allows them to level the playing field with their external contacts. There is a wealth of consumer spending data that helps IROs to gain signal clarity, trace performance trends, analyze patterns, set benchmarks, anticipate analyst and investor questions and establish messaging during earnings calls.
De-identified consumer spending and transaction data, from the right provider, is a great resource for retailers, banks, ad tech firms, governments and academics to gain a fuller understanding of industries under consideration and generate actionable insights. IR teams can take advantage of these benefits, too.
Seeing the whole pictureOn a granular level, de-identified consumer spending data can tell you a great deal about individual transactions: the amount spent per transaction with an individual merchant, the locations where transactions occur and a buyer’s affinities for other merchants.
At a higher level, the data can be aggregated in a variety of ways to track companies and sectors and to observe macro trends across industries. The resulting insights can inform a variety of actions, from determining a company’s fair market value to setting KPIs or anticipating near-term and long-term performance and growth.
Consider, for example, looking for information surrounding holiday spending. The 2022 holiday season has already presented retailers and industries with confusion. While holiday shopping has traditionally accounted for up to 40 percent of annual sales, could this year’s season see a return to that threshold, or would 2022’s economic uncertainty – marked by inflation, a tight labor market and pandemic-related changes in social behavior and supply-chain trends – wreak holiday havoc for merchants?
At Envestnet® | Yodlee®, which tracks de-identified consumer spending data from more than 2 mn merchants across more than 60 industries, researchers are seeking to answer this question by comparing data from recent holiday seasons and from the first two thirds of 2022.
What they have observed thus far for various industries is that, despite some initial sticker shock when inflation spiked this summer and sent year-on-year spending into sharp declines, spending rebounded for key holiday-season players – notably, travel, food, apparel & accessories and home entertainment – by the end of the summer, boding well for year-end revenues.
In supermarkets, for example, Envestnet® | Yodlee® researchers looked at three years of transactions at stores like Albertson, Aldi, BJ’s Wholesale Club, Costco, H-E-B, Kroger, Publix, Safeway, Sam’s Club, Target, Trader Joe’s, Vons, Walmart, Wegmans and Whole Foods Market. The study found robust spending increases during the previous two holiday seasons but fluctuating spending thus far in 2022 as shoppers feel the effects of inflation.
Nonetheless, grocery shoppers were still spending more throughout 2022 than they did before Covid. And that was on top of rising spending throughout 2021. A supermarket IRO, looking to allay the anxieties of investors and analysts, might have used such data to note the long-term positive trend in consumer spending on the firm’s groceries, cite individual stores that were excelling, discuss the overall health of the industry and set expectations for holiday earnings. Tracking of weekly or even daily transaction records can arm IR teams with the most current data to inform reporting and projections.
Looking to 2023If you’re an IRO looking to better understand your firm's performance and better communicate those results to investors, you may benefit from a solution that helps provide greater transparency to the signals investors analyze to forecast quarterly targets and predict growth – 2023 may be the time for you to seek an advantage through a consumer spending data and analytics solution, like those offered by Envestnet® | Yodlee®.
Envestnet® | Yodlee® Merchant, Retail, Shopper and Spend Insights use de-identified transaction data from a diverse and dynamic set of data from millions of accounts to identify patterns and context to inform spending and income trends. The trends reflect analysis and insights from the Envestnet® | Yodlee® data analysis team. By combining data with intelligence – connecting vast amounts of actual de-identified shopping data with state-of-the-art analytics and machine learning – Envestnet® | Yodlee® provides visibility into an entire set of daily shopping purchase behavior including, but not limited to, transactions, customer lifetime values and merchant/retailer shares.
To learn more and get a free demo, please contact an Envestnet® | Yodlee® sales representative or visit www.yodlee.com/data-analytics/corporate-data.
