THE SITUATION: A manufacturer's share of shelf and its category dollar share are highly correlated. Item share is a critical driver of category share and brand growth because over 70% of purchase decisions are still made at-shelf. Retailers seek increasing guidance on how to localize assortment, address the unlimited online shelf and balance space allocation between national, challenger, and store brands. Complicating the assortment equation is a shrinking retail footprint, shifting space from center store to an expanding perimeter, and a continuous flood of new items into the marketplace. Determining the optimal shelf set of assortment requires a deep understanding of category growth drivers, shopper types and behaviors, and the ability to customize recommendations. While a number of tools and scorecards exist, a well-informed strategy with assortment guidelines is the foundation to compel retailers to act.
OUR SOLUTION: We believe that developing category assortment strategies that link to well-supported guidelines is an integrated discipline, essential to inform an algorithm or model embedded in assortment planning tools. We conduct a thorough business assessment focusing on the shopper, consumer, manufacturer and retailers. This creates market definition, decision hierarchy and category vision that sets up the category for long-term success. This perspective allows us to clearly link assortment guidelines to a category vision and growth strategies to drive constancy of purpose behind one message at the point of purchase. We incorporate retailer data to customize guidelines and support, where possible. Assortment does not operate separately from other shopper marketing levers, so taking a broad view is necessary to provide an end-to-end solution, as illustrated below.
END BENEFIT: At a more tactical level, assortment optimization enables trading partners to determine which products should be in the item mix by understanding the incrementality of each product and its transferable demand to substitutable products. Further investigating the interaction of different products brings visibility to maximize shopper reach while increasing top-line sales and profitability.TALK TO AN EXPERT