The term “Category Management” comprises how a retailer manages all of its product categories (macro category management) or just one specific category (micro category management), as well as how a manufacturer manages its brand within the context of a given retail product category.Decision Analyst helps optimize retail categories (macro), a specific category (micro), and the performance of individual brands within specific product categories. The following section focuses on research methods to optimize a retail category to the benefit of the retailer and/or to the benefit of a specific manufacturer’s brand within that retail category.
Retail Category Optimization
The goal of a retailer is to maximize the sales and profits of a given product category within the limits of space devoted to that category. Generally, the retailer is somewhat brand agnostic in this endeavor, so long as the sales-profit goal is achieved. To optimize a retail category, three sets of questions must be answered:
- How do the category and its brands interact with other categories and brands within the store? If these interactions are not understood, what is gained in the subject category that might be offset by losses in another category?
- What brand equities (brand strengths) are represented by the various brands (including private labels) that make up the subject category? How strong is consumer loyalty to each of these brands? What brands are “must haves”? What brands can easily be replaced by another national brand or by a private label brand?
- What is the optimal organization of the retail (or online) display? What is the optimal pricing for each SKU?
Depending on the industry and the category, Decision Analyst recommends research methods that will optimize category sales and profits for the least investment in research and analysis. Frequently used research approaches include depth interviews with category consumers, ATU types of studies, and choice modeling experiments to optimize the shelf-set and pricing.
Category Management Services
Decision Analyst has over 40 years experience in brand research, strategy research, and category management. If you would like to discuss consulting possibilities or would like more information, please contact Jerry W. Thomas, President/CEO (firstname.lastname@example.org) or call 1-800-ANALYSIS (262-5974) or 1-817-640-6166.
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