The three essential pieces of the category management jigsaw

Darren Smith
26 November 2015

The very words "category management" split those in the retail world into three groups; those that think category management is old hat, those that are fearful because they don’t completely understand it, and those that believe they are practicing good category management.

Whatever group you fall into, we all agree that there is only one true goal and that is sales and profit, which will come easier to us, if we know what our shoppers want. To this end, putting aside what we call it, we have a puzzle to put together and that is the one that shows us the shopper and there are three key pieces. The three essential jigsaw pieces of the category management puzzle are "shopper profiles", "shopper map" and "shopper segmentation".

1. Shopper profiles
We once used the Acorn data of ABC1, and so on, to better understand the shopper, but the challenge is to understand the "real" shopper profiles of our own category. And ultimately the challenge is to then turn the stacks of data into a simple chart for everyone across the sales team to understand and be able to make better day-to-day decisions as a result.

A Boston matrix showing the two main axes of the shopper, which might be frequency and enjoyment, will then help you identify that there are four to six shopper profiles in your category. By doing this you will also identify sales opportunity values that will persuade the most ardent of non-category management fans that £X million is worth seizing.

2. Shopper map
This piece of the puzzle has the most amount of mystical fog surrounding it because it is known by many names, like "purchase decision hierarchy". In essence, it is how we, as shoppers, shop the category - those decisions that we make at the fixture without thinking.

For example, chilled ready meals – the first decision is cuisine, e.g. Indian, the second decision is for one, two or more people, and the third decision is likely to be a value for money decision of quality versus price. The better we match the fixture to how our shopper shops, the happier they will be to shop and buy more.

3. Shopper segmentation
Understanding how the shopper groups our products is very important. Watching shoppers in focus groups grouping products, according to what they understand, will be far different to watching people in that industry group the products.

"Topfruit" is an example of an industry term that is widely used in produce to describe apples and pears, yet shoppers have never heard of it. Once your shoppers have grouped your products into their understanding, the challenge is to reflect this on the fixture as closely as possible, or, at the very least, plug the difference with excellent signage and packaging to help the shoppers make an informed choice.

☛ Darren Smith is a former category manager and founder of Making Business Matter

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