Each retailer trading area offered by Nielsen/IRI also has a “remaining market”. The remaining market represents that retailer’s competition in that geographic region. This remaining market is important for benchmarking.
To create the remaining market for a retailer, IRI and Nielsen include all competitive stores physically located within the boundaries of that retailer’s trading area. Nielsen calls the retailer’s competitive market the ROM (short for “Rest of Market”). IRI calls it the CRMA (short for “Competitive Retailer Market Area”). The ROM/CRMA gives you a single comparison point for each retailer, a weighted average of all the competitors.
Also see glossary post on Trading Area.
Does the REM in Nielsen only include Food Channels? Or does it include Food, Drug, Mass, etc?
Some food retailers do have Rem xAOC available (Albertson’s Safeway for example). It depends how the individual retailer defines their competitive set. It will have Rem xAOC in the market name if it’s includes something other than Food. If it just says Rem it’s just Food.
Sally – my understanding is that CRMA and REM do not represent exactly the same concept. As I understand it (from reading this amazing site!), CRMA is inclusive of the related RMA where as Nielsen’s REM does not include the related TA. Do you know why IRI and Nielsen don’t take the same approach to trading areas? I liked your article on the benefits of REM/ROM vs CRMA – but I can’t stand the thought of having to manually calculate REM/ROM in IRI for all my retailer analysis. Would love your thoughts on how to efficiently approach this type of analysis – or do I just have to access that ROM/REM needs to be manually calculated outside of IRI? FM
Yes, your understanding is correct. We’re not sure why Nielsen/IRI do this differently. Maybe it was on purpose, to be deliberately different. Or maybe it happened by chance and then stayed that way due to precedent and not wanting to deal with changing historical data.
Robin and I agree that the Nielsen ROM/REM is generally a better comparison, especially if the retailer is a relatively big player in the specific market (which means they drive more of the CRMA results in the IRI data). Robin works more frequently with IRI data than I do so I checked with her and she says that, when time allows, she does manually create the ROM for volume and price measures and shows CRMA with an asterisk for ACV-based measures. Maybe there is a way to create a custom market within the IRI software to make this process easier?
Sally,
Having worked for years in IRi data, I am now analyzing a customer’s Nielsen IQ (NIQ) data. Your data tip sheet has been a super help. I am a bit confused by 2 terms that aren’t listed: RM Food (ex: ALBSCO Jewel Div RM Food) and RM xAOC (ex: ALBSCO Jewel Div RM xAOC). Would that be “Remaining Market Food/Grocery” and “Remaining Market eXtended All Outlet Combined”?
You’re right – RM stands for Remaining Market, one is for Food/Grocery channel only and the other is for xAOC. (So RM Food is a subset of RM xAOC.)
Thank you so much! So would TA + RM = roughly the equivalent of CRMA (in IRi)? I ask as our promotions not only affect the retailer that it’s in, but also the surrounding retailers.
Yes!
Sally, in Nielsen why doesn’t Walmart Total + Walmart ROM equal xAOC? What would be included in xAOC that’s not included in Walmart ROM (besides Walmart)?
Great question! One would assume that if Walmart has stores across the entire US, then WM Total + WM ROM would equal Total US xAOC. How far apart are those 2 things in what you’re looking at (the sum vs. TUS xAOC)? My guess is the difference is small and that a difference exists because only the counties in which Walmart has stores are counted in the Walmart and Walmart ROM geographies. So counties where Walmart does not have stores would be in TUS xAOC but not in WM + WM ROM. Hope that helps!