Google “8 steps to mastering category management” and you’ll see tens of thousands of articles laying out the long-prescribed and ever-familiar category management approach. But in light of a recent study which found that 85% of retailers have made only moderate if any changes based on these eight steps over the past 20 years, the question arises: do these eight steps really offer the best way to approach category management?
The standard eight-step approach begins by generalizing the customer base of a retailer as being one defined population who all behave in a similar way. This generalized mentality when approaching category management is a missed opportunity as consumer behaviors continue to evolve. By leveraging insights gained from drilling down into digital-based consumer and shopper data, a better understanding of consumer preference and behavior can be gained. This enables a new, more shopper-centric approach to be implemented — resulting in more satisfied customers and a more efficient and profitable relationship between CPG brands and retailers.
The remainder of the seven steps overview additional steps to implementing appraisals, scorecards, and strategies for categories, yet each step is predicated on a rigid and perhaps overly assumptive understanding of contemporary retail consumers. Instead of focusing category management strategies on narrowly focused categories, shift the focus to better understanding the perspective of the shopper and build efforts around their behaviors.
By implementing a powerful performance management solution like Salient’s Margin Minder, all available data from any number of sources can be brought together into easy-to-navigate dashboards, allowing everyone from the CEO to field reps to drill down through vital consumer information in seconds. By evaluating data by market, retailer, SKU, or any number of levels, more customized and shopper-centric categories can be identified and more easily managed.
Learn more about how Margin Minder can help uncover a new approach to category management.