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Understanding Category Management in Retail

Category management

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anasjawed364369157
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85 views15 pages

Understanding Category Management in Retail

Category management

Uploaded by

anasjawed364369157
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
  • Category Management Overview: Introduces the concept of Category Management in retail, focusing on structuring product assortments based on consumer purchasing behavior.
  • What is a Category?: Defines a category and explains the purpose of category management to improve performance in retail settings.
  • Importance for Retailers: Highlights why category management is crucial for retailers, focusing on customer alignment, competitive differentiation, and profit increase.
  • Importance for Manufacturers: Discusses the significance of category management for manufacturers, including collaboration with retailers and inventory optimization.
  • Organization of Retailers and Manufacturers: Explains how retailers and manufacturers organize their category management efforts for effective merchandising.
  • Category Management 8 Step Cycle: Outlines the eight steps of category management from defining categories to implementation and review.
  • Define: Presents the best practice principles for defining categories based on consumer needs and market trends.
  • Category Role: Loyalty Drivers vs Profit Contributors: Explores different category roles in balancing customer loyalty with profit contributions.
  • Assess & Set Objectives: Details the process for assessing categories and setting objectives to align with business goals.
  • Strategies & Tactics: Provides strategies and tactics to enhance category management effectiveness through various initiatives.
  • Implement & Review: Describes the implementation and review stages, including the use of planograms and customer satisfaction metrics.
  • Category Manager's Role: Defines the responsibilities of a category manager including strategy implementation and performance evaluation.
  • Barriers in Category Management: Identifies the common barriers faced in category management, such as misalignment and trust issues.
  • Conclusion: Concludes the document with gratitude and final remarks on the importance of category management.

CATEGORY

MANAGEMENT
DEFINITION
Category management is a technique used by retailers where
the product assortment is subdivided into categories that reflect
the purchasing behavior of the target consumers. These
categories are then managed as separate business units.

PURPOSE
The main purpose of category management is to improve the
overall performance of a group of similar products rather than
focusing on individual items.

WHAT IS A
CATEGORY?
WHY IS IT
IMPORTANT FOR
RETAILERS?
1. Alignment with Customer Needs

2. Differentiation from Competitors

3. Improved Internal Management

4. Increased Sales and Profits


WHY IS IT
IMPORTANT FOR
MANUFACTURERS?
1. Shifting Focus to the Category

2. Collaboration with Retailers

3. Reduced Dependence on Trade Allowances

4. Inventory Optimization
HOW ARE RETAILERS AND MANFACTURERS ORGANISED?

RETAILERS MANUFACTURER
Category Managers – buying & merchandising Brand and Sales management

Product assortment, pricing, promotion, space Building relationships with retailers to ensure their
management, and inventory replenishment brands have a significant presence within the
retailer's category strategy
DEFINE
ASSESS &
SET
OBJECTIVES
STRATEGIES & TACTICS
TRAFFIC BUILDING Attract consumer in-store

TURF PROTECTING Response to competitor

TRANSACTION BUILDING Drive sales per customer

PROFIT GENERATING Retailer own brand

EXCITEMENT GENERATING Seasonal

CASH GENERATING Large packs, 11-11 sales

IMAGE ENHANCING
IMPLEMENT
& REVIEW
CATEGORY MANAGER’S ROLE
REVIEW CATEGORY TARGET CONSUMERS PLAN MERCHANDISING

Analyze market share, sales Use consumer data to Develop pricing, promotion,
trends, and performance understand shopping behaviors and shelf strategies

IMPLEMENT STRATEGY EVALUATE RESULTS

Align the plan with store operations Continuously assess performance


and ensure proper execution and make adjustments
BARRIERS
Misalignment of incentives between retailers and
manufacturers

Lack of trust and data sharing

Complexity in managing categories over individual brands


THANKS

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