The Supply Side: ItemMaster aims to grow footprint as a content curator

Content remains king in the retail world of omnichannel. That’s a message Walmart has preached for several years. Chicago-based ItemMaster heard the call and connected with the retail giant last year to work with suppliers on their content creation and management.

John Pennington, director of national sales at ItemMaster, said his company has worked with Walmart in its brand activation center in Indianapolis as a content partner for retail suppliers. He said ItemMaster works to help Walmart suppliers with cumbersome content requirements through a variety of service offerings. He said the company looks to expand its local footprint in the region over the next year as Walmart’s focus on content continues.

Walmart has made the case for its suppliers to furnish the optimized item content because without it the retailer can’t successfully grow sales against its competitors. Most agree online sales are gaining momentum, but grocery has been one of the slower categories to gravitate toward e-commerce.

In 2016, Deloitte Consulting said 51% of in-store grocery sales were influenced by digital technologies somewhere along the path of purchase. That was a wake-up call for CPG (consumer packaged goods) suppliers and retailers.

A separate report from McKinsey predicted by 2018 as much as 30% of CPG industry sales growth would come from online. That has not yet happened. Through 2016, online sales of CPG surpassed $10 billion, up from $7.3 billion the prior year. IRI estimates the overall U.S. CPG industry at $760 billion. Last year online sales were about 8% of the CPG total industry revenue, according to IRI.

J.P. De Villiers, director of content acquisition at Walmart, told Talk Business & Politics/Northwest Arkansas Business Journal in September the retailer had about 100,000 items in its store that were not yet available online. He said some of that is seasonal, but getting a complete catalog of items is becoming more crucial because an estimated 76% of purchases in-stores begin online.

De Villiers said his top priority is to get information on as many supplier items as possible posted online, and that has to start with complete, unique and accurate content. He said Walmart is investing big in that area, and suppliers must also step up given the mandate.

Walmart President and CEO Doug McMillon said during the recent earnings call with analysts the retailer plans to double the number of grocery pickup locations in the U.S. this year, giving it 2,000 pickup sites located within 10 miles of 90% of the population. Walmart is focused on grocery pickup because it not only drives online sales, but a higher average ticket for online shoppers compared with in-store customers boosts the top line.

Also, stores that offer grocery pickup enjoy higher in-store sales than those that don’t. That omnichannel focus is a mainstay for Walmart and retail overall, according to Jami Dennis, CEO of Bentonville firm Vendor Masters.

“The ability for consumers to seamlessly shop from one channel to the next is essential,” Dennis said. “From following their favorite Instagram fashionista to mobile check-out, suppliers will have to find new ways to connect with consumers. In addition, suppliers will be challenged on how to get their products to the consumer faster, stepping up their responsiveness … decreasing lead times and investing in better fulfillment options to keep up with the latest industry delivery standards.”

Pennington said Walmart’s focus toward online grocery fits well with ItemMaster’s strengths. He said ItemMaster was a startup originally built inside PeaPod to help the online grocery pioneer develop item-level content in 2006. He said the specific content helped shoppers better manage their shopping lists for specific needs such as nut allergies or other health issues.

In 2013, ItemMaster began a three-year process of being spun out of Peapod so its services could be marketed to all retailers. By 2016, ItemMaster became a standalone business garnering Series A funding from Edison Partners. The company has since partnered with Walmart as one of 22 content service providers approved to work with Walmart suppliers.

ItemMaster said brand visibility is crucial, and there is no easy button to push when it comes to generating consistent, detailed content that is recognized in retailer algorithms and search filters of browsers like Google. Suppliers spend millions of dollars every year promoting brands and products. While online consumers search, sort and filter structured content, internal departments, including planogram, merchandising and marketing teams, also need access to complete, verified, and enhanced product data. The idea of “let’s hope our brand is found” is crazy,” ItemMaster noted in a recent White Paper.

Pennington said the largest suppliers have so many products in their catalog that optimizing the content can be cumbersome and time intensive for what has typically been a small team focused on the supplier’s e-commerce business. He said omnichannel is changing the game and suppliers to Walmart and other retailers focusing on online grocery will have to beef up their own teams or outsource the work.

In a case study with Peapod, which is owned by grocer Ahold Delhaize, ItemMaster said they were challenged to help the grocery chain drive more revenue with higher basket sales. According to ItemMaster, they were the only service to provide complete and verified product content to minimize content cobbling and allowed for consistency and brand recognition across the digital shelf. The results from the content investment were bigger baskets by over $42 on average.
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Editor’s note: The Supply Side section of Talk Business & Politics focuses on the companies, organizations, issues and individuals engaged in providing products and services to retailers. The Supply Side is managed by Talk Business & Politics and sponsored by Propak Logistics.