CATEGORY

MANAGEMENT
Yesterday, Today
& Tomorrow

An ECR Community
Review of Current
Practices in Category
Management 2020

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 CATEGORY MANAGEMENT
Yesterday, Today & Tomorrow

Contents
Acknowledgements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Editorial Committee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
A Word from our Sponsors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
INSIGHTS .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Category Management - Yesterday, Today and Tomorrow,
by Brian Harris and Luc Demeulenaere. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Managing in Times of Crisis – Insights and Learnings from the Covid-19 Pandemic
- The Role of Category Management, by Claudio Czapski, David Ciancio and Brian Harris.. . . . . . . . . . . . . . . . 40
The Social Science of Shopper Marketing, by Ken Hughes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52

ECR COMMUNITY REPORTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60

Total Store Optimization – Next level of Category Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Most efficient functionalities to improve user experience on food E-retail website. . . . . . . . . . . . . . . . . . . . . . . . . 68
Omnichannel Category Management:
Moving from product categories to shopper needs & wants categories. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76

CURRENT PRACTICES IN CATEGORY MANAGEMENT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84

Introduction to Current Practices in Category Management. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
∂ France . . . . . . . . . . . . . . . . . . . . . Lactalis Nestlé . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
∂ China . . . . . . . . . . . . . . . . . . . . . . . Rainbow Department Store . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
∂ Italy . . . . . . . . . . . . . . . . . . . . . . . . . Birra Peroni . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
∂ Germany. . . . . . . . . . . . . . . . . . . Rewe, Coca-Cola & Hoffrogge .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 106
∂ Greece. . . . . . . . . . . . . . . . . . . . . . Nestlé .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110
∂ Ireland . . . . . . . . . . . . . . . . . . . . . Musgrave Retail Partners Ireland . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 114
∂ France . . . . . . . . . . . . . . . . . . . . . Coca-Cola European Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118
∂ Canada . . . . . . . . . . . . . . . . . . . . Metro. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126
∂ Ireland . . . . . . . . . . . . . . . . . . . . . Heineken . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 133
∂ Brazil . . . . . . . . . . . . . . . . . . . . . . . Raia Drogasil .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137
∂ Greece. . . . . . . . . . . . . . . . . . . . . . Coca Cola HBC .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141
∂ Italy, UAE, France . . . . Barilla, Carrefour . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149
∂ Greece. . . . . . . . . . . . . . . . . . . . . . Mars . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161
∂ Brazil . . . . . . . . . . . . . . . . . . . . . . . Nestlé .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 167

TECHNOLOGY IN CATEGORY MANAGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 172

To be fit for the future, Category Management must embrace the power of customer insight . . . . . . . 174
Meatsnack Shopping 2020 – Perfect Shelf. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 178
Using AI and Technology to create a better Dairy Category experience. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 190
Using Blockchain to promote food category quality - Carrefour’s Food Provenance Program.. . . . . . 200
Enabling the Multi-Channel Customer Journey. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 204

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Acknowledgments

It has been a privilege to lead this ECR Community initiative. I have been intrigued by the study of
Category Management & shopper behaviour for many years and am delighted to present such a global
Review of current practices.

My sincere thanks and appreciation go to the Editorial Committee for the countless hours spent in virtual
meetings debating and fine tuning this Review.

Special thanks to Dr. Brian Harris and Luc Demeulenaere who are contributing to their third major
ECR publication on Category Management and have significantly enriched this Review with their deep
experience, passionate analysis and progressive views.

Particular thanks to all retailer and manufacturer executives who have contributed their time and
experience to this Review and are playing a significant role in advancing the standards of Category
Management globally. Central to this Review are the case studies from retailers & manufacturers
illustrating how Category Management is currently being used throughout the world. All case studies are
presented according to a common template and include background information to allow the reader to
put into context the scale & complexity of each initiative from the outset.

I am grateful for the support from dunnhumby, Hoffrogge and Yagora. They have added their expertise to
this Review and appreciated the benefit and need in being involved in such a global publication.

Declan Carolan
General Manager, ECR Ireland & Co-Chair, ECR Community

[email protected]

All rights reserved.

No part of this publication may be reproduced or transmitted in any form or by any means, electronic, mechanical, photocopying,
recording or otherwise, or stored in any retrieval system of any nature, without the written permission of the copyright holders.
© ECR Community
This report contains considerable intellectual property and ideas provided by contributors. It has been provided for use by the
industry. This material cannot be used by other consultants for commercial purposes.

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Foreword
Declan Carolan,
Co-Chair, ECR Community

November 2020

This global ECR Community Category Management where collaboration brings better results for all and
publication has a clear objective. To build a community creates correct superior value for the end customer. This
platform to help the practitioner and the manager to deal publication brings these dimensions in the framework
with the massive speed of change that is impacting the of the right market value creation and formulates some
marketplace today. recommendations for retailers and manufacturers.

This publication gives both a historic and a future view Before supermarkets, hypermarkets and discounters
on the methodology for how to go-to-market as a retailer existed there was a local store owner who knew his
or a product manufacturer and is food for thought to all customers by heart, their aspirations and preferences,
who have an interest in the business of value creation and he was able to respond in a superior way to win
with the consumer and the shopper. the heart of his customers. The development of scale
in retail solutions since the 1970’s has brought dilution
From the student who has a career ambition to the
in this commercial intelligence. Category Management
practitioner, to higher management, this publication will
has been and is the progressive insight methodology
stimulate new ideas and build greater understanding of
to bring this commercial intelligence into scaled retail
why businesses win or lose because of changing market
environments.
dynamics and not in the least, recently in situations of
economic crisis, when consumer and shopper behavior As such it will even grow in importance in the future
change significantly. as AI develops, E-commerce, robotics and NFC make
major contributions and in that respect we hope that this
Category Management as a work model provides
publication gives you inspiration to be faster and better
insights into how retailers and manufacturers can
than your competition.
build winning strategies within a logical brand building
framework, how new retail channels, new technologies I believe this publication will promote knowledge
and new media arise. Even more importantly, it provides development and trigger significant discussion and
the method for how to build upon the consumer/shopper debate by category managers globally. This debate
insights to configure the go-to-market strategies and will be richer if there is an appropriate forum to
tactics for brands and store formats to succeed. facilitate such. To this extent, ECR Community will
host a series of webinars in 2021 to promote this
In the design of these methodologies and their enabling
Review. The objective will be to allow contributors the
organizational approaches and tools, all companies
opportunity to bring their submissions to life and enable
need to do an update and understand what it is they can
practitioners across the globe to interact and gain better
contribute in a multi-dimensional market environment
understanding. I encourage all to engage with these
where brands, retailers, tool providers and researchers
webinars and believe they can be the launchpad for a
each play their role and sub-optimize towards their
global ECR Category Management Network.
personal business goals. We often forget what a
network economy could do better by just understanding

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BIRGIT SCHRÖDER - Lead Shopper Experience, GS1 Germany

Editorial Committee Birgit Schroeder is Lead Shopper Experience of GS1 Germany and responsible for ECR
Germany. Birgit has been focusing on the topics of Category Management and Shopper
Experience for more than a decade. In doing so, she is strongly oriented towards the
idea of ECR, with the conviction and experience that a cooperative approach with focus
DECLAN CAROLAN - General Manager, ECR Ireland & Co-Chair, ECR Community on consumer needs achieves much more positive results than a one-sided approach of
the market participants.
Declan has worked in the retailing/FMCG sector for over thirty years. In Superquinn
(a chain of Irish supermarkets), he worked in store management and category
management roles and was the company’s first Head of Supply Chain. In this role,
Declan introduced holistic company strategies, according to ECR principles, where FRANÇOISE ACCA - Consultante GT Online, Institut du Commerce / ECR France
effective operations, optimal product availability, retailer/supplier collaboration, category Françoise Acca is the founder of ACTINCO and coaches organizations in their agile
management & supply chain strategies were aligned and became drivers for growth. business transformation. She trains and facilitates in E-commerce and customer
Within ECR, Declan is a firm believer in working together, internally & externally, to raise journey. Previously, Françoise was Marketing Manager in both Carrefour France and
overall knowledge & expertise throughout the industry as “a rising tide lifts all boats”. Italy and is now working for Institut du Commerce / ECR France.

DR. BRIAN HARRIS - Senior Advisor

Dr. Harris pioneered the concept of Category Management in the late 1980’s. Since
then he has been a leading ambassador and thought leader teaching and delivering the CLAUDIO CZAPSKI - CEO, ECR Brazil
benefits of Category Management methods to hundreds of retailers and manufacturers
Graduated in business in 1972, worked with management responsibilities for Mercedes
across the globe. He co-founded The Partnering Group in 1990 to provide a platform for
Benz, Pfizer and Bunge International, and as a strategy consultant for a broad array of
the global use of Category Management. For the last 30 years, he has been a leading
companies, ranging from manufacturing and distribution to health services, food service
contributor to every major ECR industry initiative across the world directly related to
providers, associations, governments and institutions such as WHO, PAHO, World Bank
Category Management and its related practices.
and IDB.
Since 2000, in addition to consulting, CEO of ECR Brazil and collaborating with different
LUC DEMEULENAERE - Senior Advisor universities and specialized media organizations to disseminate consumer and shopper-
centric management concepts and implementation processes.
Luc has over 35 years of experience in the FMCG industry including over 12 years as
a global Associate Director in Procter & Gamble’s global operations. His primary roles
were to support the implementation of Category Management globally with P&G’s key ANTONELLA ALTAVILLA - Academy Consultant for Category Management, GS1 Italy
retail customers and to lead shopper insights initiatives to support these efforts. He co-
founded the Brussels based consultancy ShopTing in 2012. He is a globally recognized Antonella Altavilla is the GS1 Italy Academy Consultant for Category Management and the
expert on Category Management and in the use of consumer and shopper insights in Owner of ADF Consulting. She has significant marketing experience, as Chief Marketing
brand equity building frameworks. He has been involved in all industry related ECR Officer in leading companies operating in retail industry. Antonella runs important joint
publications in Europe since 1998. projects between Retailers and FMCG Manufacturers working for leading Consulting Firms
such as Roland Berger and KPMG Advisory and has published several articles and two
books including Category Management, Omnichannel and Digital Marketing, Shopper
DAVID CIANCIO - Global Head of Grocery Retail, dunnhumby Marketing and Customer Relationship Management.

David has 50+ years of retail experience as an operator, marketer, and strategist. He
created Kroger’s first-to-market and industry-leading KrogerPlus loyalty program after
CHÉ MCGANN - Projects & Communications Manager, ECR Community
working in every role in a supermarket, proudly including 20 years in store management.
Currently, David helps dunnhumby’s global clients grow their sales and loyalty by Ché provides the daily support to our global network of ECR Nationals and works with
creating better Customer experiences, and by applying Customer-led organisational them to progress best practice and collaboration across our membership base. With a
change. For his visionary and pioneering work in applied data science to grocery background in engineering and a keen interest in sustainability, Ché also works with a
merchandising and marketing, Ciancio was named one of Advertising Age magazine’s number of Irish corporates on their sustainability strategy & circular economy projects.
“Top 50 Marketers” as well as one of RIS’s “Top 10 Retail Influentials of 2020”. She previously worked with Sustainable Nation Ireland.

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A Word from our Sponsors

www.Hoffrogge.com

We at Hoffrogge experience that dialogue-oriented cooperations in Category

Management between retailers and manufacturers are the best way to achieve
profitable category growth.
If the processes are based on well-managed data and the relevant category tactics are
supported by scalable software solutions, the strategy can easily be executed even on a
store-individual level.
Our customers confirm that our fully integrated back office solutions combined with the
easy-to-use mobile applications for the people in store will make a difference in the
future ways of working.
Wilhelm Hoffrogge - CEO, Hoffrogge

www.dunnhumby.com

dunnhumby helps retailers and brands to deliver better shopper experiences through
Customer-First strategies. With a unique combination of consultancy and best-in-class
software and tools, our Category Management framework helps clients turn the data
they already own into insight, so they can focus on what matters most to shoppers,
make smarter category decisions, grow sales, and protect margins.
We’re pleased to share two case studies of category management projects showing
how clients brought the ‘voice of the shopper’ into their decision-making process,
ultimately improving the in-store shopping experience and generating sales uplift.
David Ciancio - Global Head of Grocery Retail, dunnhumby

www.yagora.com

At Yagora purchasing decisions have been at the heart of our thoughts and actions for
over 20 years. Using well-founded data, we measure and analyse shoppers’ behaviour
when making purchasing decisions and examine the attitudes, motives and emotions
behind them. Yagora is partner of GS1 Germany since many years and we are happy
to share together with our client Jack Link’s a very successful category management
project which we carried out in Germany.
Andreas Luppold – Partner, Yagora GmbH

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INSIGHTS

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Category Management
Yesterday, Today and
Tomorrow
Brian Harris and Luc Demeulenaere
The primary objective of this paper is to recognize the key role that Category
Management has played in the evolution of the consumer goods retailing and marketing
industry since its introduction thirty years ago and to reinforce the importance that this
core business process will continue to play as an essential business method in the
dynamic world of consumer and shopper marketing.

INTRODUCTION The main sections of the paper are:

∂ Executive Summary of Content

Category Management has known it’s success since the
late 1980’s as it made decision making in retail more ∂ Category Management 1987 to 2010 – Bringing the
data based and, as a result, more productive and more Consumer into Retail Marketing
connected with the consumer. Now almost 40 years ∂ Category Management in the Omni-Channel Era
later, retail has changed, data availability has changed, - 2010 to 2020 – Bringing the Shopper into Retail
the consumer has changed, technology has changed Marketing
and economic dynamics have changed. It’s time to
review the role that Category Management has played ∂ The Future – Integrated Consumer and Shopper
Marketing
in the evolution of retail marketing and to define its
contribution in the future. ∂ Recommendations for Retailers and Manufacturers
First, we review two time periods since the introduction
of Category Management – 1987 to 2010 and 2010 –
2020. Each of these periods has been characterized
by unique industry dynamics that led retailers and
manufacturers to view Category Management as an
essential tool for their business success. We then
lead you to the critical success factors that will make
your business win in the future and some thoughts
on how Category Management is likely to evolve in
the next 3-5 years. How some new technologies and
tools will drive this evolution will be presented. Some
recommendations for retailers and manufacturers to
continue to get maximum value from their investments
in Category Management will conclude the paper.

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EXECUTIVE SUMMARY to work collaboration between retailers and

manufacturers
OF CONTENT
∂ The role of the category to manage traffic versus
Category Management 1987 to 2010 profit mix and how this translates in different category
– Bringing the Consumer into Retail strategies and tactics
Marketing ∂ Efficient Consumer Response (ECR) becomes a
global collaborative initiative with Category Management
1. New competitive forces reshape retail: as the umbrella; total system efficiency, store space
∂ The blurring of the boundaries of the traditional management, direct product productivity and data
channels: drug stores sell food, food stores sell drugs sharing are the leading methodology concepts.
etc.

∂ Rapid growth of discounters Category Management in the Omni-Channel

Era - 2010 to 2020 – Bringing the Shopper
∂ Category killer stores make their entry into Retail Marketing
∂ Retailers develop private labels and retail brands
and bring new pricing dynamics into the customer 1. New generation of consumers, upcoming trends
Category Management proposition and management of global issues
∂ Health management, sustainability and ecology,
2. Bringing the consumer more into retail decision- individuality, social responsibility, convenience put
making societies, governments and the consumers in a new
∂ POS data-use and sharing to complement consumer context to change consumption and shopping choice-
The Future – Integrated Consumer and
and shopper store productivity insights making, influencing strongly category strategies and ∂ The role of the category in these new shopping
tactics missions, consumption occasions bring Category Shopper Marketing
∂ The loyalty card opens new ways to build customer Management in a new cross- category offering
relationships and insights ∂ The new generation of consumers brings a shift in platform, dictated by the Consumer-Shopper journey
1. The era of shopper marketing in the Consumer
buying power and urges companies to rethink their and Shopper journey
∂ Category Management as a data based language offer and the shopping experience
which starts from the consumer need value drivers
and the consumption occasions which lead to where ∂ Retailers become marketers to win the shopper with
and what her money is spent on. differentiating offers, store formats and media offering
based on insights derived from the Consumer and
2. Innovative channel development to reach the Shopper journey.
consumer
∂ The CS- journey to integrate consumer and shopper
∂ ‘On the go’ store formats, ‘online- store’ developments value drivers and the resulting customer experience
in retail bring the consumer and her product user- insights on expectations
moments closer and blurs the traditional shopping
habits ∂ The CS-journey influence - structure to manage
consumer and shopper- interactions (social media,
∂ Convenience and Price become heavy shopper search engines, traditional) in a more strategic
drivers in the retailer constellation, driven by new price marketing logic, reshaping drastically the traditional
transparency and the convenience of e-Commerce media solutions
home delivery

∂ From physical store to omni-channel to opti-channel 2. Big Data providing the platform for Artificial
revolution. As price, multiplication of the on-line Intelligence
sku offer (assortment), delivery convenience, on-
line transparency of the competitive offers, mobile 3. Technology innovation drives retail innovation
switching to compare across retail solutions, on-line ∂ Virtual experience to capture the aspiration of the
browsing quality, recruiting via social media allows the consumer
consumer to see her needs answered faster, cheaper,
better informed and delivered where she/he needs it at ∂ Robotics in production, but even more in logistics to
assemble the on-line order delivery basket
in the right time.

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∂ Be clear on where to focus first – understand which ∂ Develop communication strategies and media
categories initiate purchase behavior change (non- choice tactics along the same structure to generate
food versus food, luxury versus commodity etc.); awareness, consideration (influence), trial, re-
which value drivers are better responded to in an purchase and recommendation (influence) to capture
e-Commerce channel versus the physical store that potential value ahead of competition
channel; which segments (younger consumer
generations, fashion influencers) drive other consumer
∂ Create alliances with e-Commerce retailers to
capture online ROI of e-Commerce communication
segments (e.g. older generations, followers) into
investments, especially in social media
new behavior to gain faster critical mass behind your
marketing investments ∂ Understand the cross-category and cross-consumer
segments that can have the most impact on expanding
∂ Update Category Management methods to adapt what consumers buy and where they shop in the new
category strategies and tactics (especially assortment)
channels to build a smarter opti-channel game plan
to the role of the category in each of the retailer’s
channels; identify categories which may justify a ∂ Build a central data intelligence plan to evaluate
different role in the on-line channel versus the physical consumer solution e-Commerce alternatives as new
store channel and adjust strategies and tactics logistical delivery structures arise.
accordingly

∂ Collaborate with manufacturers to re-invent supply

systems given the new convenience expectations of CATEGORY MANAGEMENT
∂ Development of mobile intelligence from Apps, mobile solutions” to the retailer’s most important consumer- consumers and the new ecology regulations to reduce 1987 TO 2010 – BRINGING
packaging waste and improve delivery efficiency
phone tracking to learn about our aspirations, values, shopper segments. Some recommendations to THE CONSUMER INTO RETAIL
desires, preferences to make the offer more relevant develop the required capabilities include: ∂ Expand the focus of negotiation to include joint media MARKETING
collaboration and shopper marketing initiatives.
in the battle to win the customer in an AI build up; ∂ Build consumer-shopper understanding to be able to
∂ Image recognition to capture behavior transition from mass marketing to mass customization 1. NEW COMPETITIVE FORCES RESHAPE
to 1-1 personalization using Artificial Intelligence tools Recommendations for Manufacturers RETAIL
to build maximum relevancy in the shopper proposition
4. Next generation of supply logistic-structures
from product source to place of consumption with ∂ Develop a strategic multi-source data intelligence
For manufacturers, the key for success will be to ∂ The blurring of the boundaries of the traditional
understand the new consumer growth drivers for the channels: drug sells food, food sells drugs etc.
respect to the new ecology rules masterplan to connect the various sources of brand, the consumer and shopper segmentation that
∂ Eco-driven home delivery supply chains
customer insights and use this intelligence to install supports these drivers and how to market to these ∂ Rapid discounter development
customer centricity as a core business philosophy
∂ Home refill replenishment solutions to build new ‘loyal’ across all functions of the retail organization
segments at each step of the consumer-shopper ∂ Category killer stores make their entry
journey. This will require new levels of collaboration to
habits via open shopping lists ∂ Retail develops private labels and retail brands and
∂ Connect marketing and merchandising decisions understand how brand segments connect with retailer
brings new pricing dynamics in the customer Category
∂ Refill intelligent packaging to reduce waste to the primary and aspirational value drivers of segments and new alliances to capitalize on the ability
Management proposition
customers to build innovative propositions ahead of of new media (especially social media) to activate
competition behavior along the journey. Some recommendations to Category Management was born in the late 1980’s.
develop the required capabilities are: Like many new methods that have been introduced
RECOMMENDATIONS ∂ Co-invest with manufacturers to improve the desired into retail marketing, the driving forces behind the
FOR RETAILERS AND price/quality equation of the category solution ∂ Identify and update each brand’s consumer drivers emergence of Category Management were changes
proposition, the convenience to shop it and to deliver to reflect lifestyle values and trends (health, ecology, taking place in the competitive retail marketplace and
MANUFACTURERS it to the place where it will be consumed and to be individuality, budget consciousness, and so on) and the impact of new competitive forces on retailers. For
able to communicate category solutions within the map these brand drivers to high opportunity purchase many years, retail competition took place within well-
Recommendations for Retailers consumer-shopper journey communication structure growth segments for the future; connect these brand defined channels. Grocery stores competed primarily
segments to likely retailer customer segments
∂ For retailers, the key for competitive advantage will be ∂ Learn to operate in an opti-channel world where with other grocery retailers, drug stores with other drug

the ability to have the deepest possible understanding

the consumer is assumed to know all about your ∂ Gain Category Management insights for these stores and so on. In the mid-to-late 1980’s, however, the
competition across all channel formats; build a data- segments along the Consumer and Shopper Journey traditional boundaries between these channels started
of consumer-shoppers, their value drivers and
sharing capability with your strategic manufacturers structure to understand how to capture potential in to blur. As retailers searched for new ways to grow sales
behavior across all channels and to leverage these
to co-invest the influencing insights and media which channel/retailer and expand their customer base, the lines that had
insights to develop and implement superior “category
investments along the journey defined these different channels began to disappear.

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Supermarkets began to carry more of the categories and party data firm dunnhumby, began to develop shopper price-quality positioning and more efficiency in their mix
products that had traditionally been offered mostly in intelligence as a weapon to differentiate itself from of promotional offers. Category Management became
drug stores. Conversely, drug stores started to expand Walmart’s low price attacks. Data captured from Tesco’s a must, and for retailers it was a necessary element to
their offerings of food categories. Convenience stores loyalty cards provided a way for Tesco to respond in a remain competitive against the growing inroads of the
started to significantly expand into more fresh and more targeted manner to the needs of its customers. discounters.
packaged food categories that were traditionally the Other retailers in the UK, and in other countries,
In addition to the growth of discount formats, another
domain of grocery retailers. This “channel blurring”, as including Germany (DM drugstore chain), Belgium
new competitive threat emerged in many retail markets
it became known as, defined the new retailing reality. (Colruyt and Delhaize) and Holland (AHeijn), also began
around the world beginning in the early 1990’s.
It imposed new and more challenging demands on to use loyalty card data not only to reward loyalty, but to
This came from “category killers” - retailers that
retailers as they entered categories in which they had develop a deeper understanding of their customers.
focused on carrying only one category of products.
limited expertise and were now in competition with a
Also, starting in Germany, and then expanding to a In Europe, a good example was the emergence and
much wider range of competitors. This changing scope
number of European countries, the entry and growth of growth of Electronics category killer retailers, such as
and nature of competition ushered in a new retailing
hard discount retailers, led by Aldi, put new pressure Vanden Borre, Krefel and Boulanger. They attacked
paradigm.
on the more traditional supermarket and hypermarket categories that had been very profitable for traditional
Several other important developments were also channels. Significantly lower retail prices were offered hypermarkets.
underway that would change the nature of retail and supported by a bare bones operating cost structure.
In the US, the most visible example was the Pet
competition forever. The clearest example was the Consumers responded positively and the market share
Category Killers, including Pet Smart, Pet Co, Pet
rapid growth of discount retailing. In the US, this was of the hard discount retail format began to grow.
Stuff and others. These were one-stop shops for all
led by Walmart and in Europe by Aldi. Walmart started
The need for retailer differentiation also provided a basis the needs of a pet owner. Traditional retailers offered a
as a non-food general merchandise retailer with the
for the expansion and growth of premium private labels more restricted range of products tending to focus on
strategy of offering the lowest possible prices. From its
and retailer brands. This, supported with information the best-selling segments of the category (dog and cat
non-food, lowest prices foundation it saw the growth
analyzed from loyalty cards, demonstrated that not all food) and a limited range of non-food pet accessories.
potential in attacking higher margin categories that,
shoppers are alike in their responses to discount prices. The new “category killers” were quickly seen by
up to that time, had been dominated by supermarket
The ability to identify and target different segments consumers as a more convenient, more knowledgeable
and drug store retailers. Household product categories
of shoppers was an important new marketing tool for and more exciting place to shop for their pets. This
(such as laundry, paper, cleaning products and pet
retailers. It delivered Tesco impressive growth through attack on the pet category was especially damaging to
products) were initially targeted with the discount
leveraging these differences across its shopper supermarkets. Pet owners tended to be family shoppers,
strategy to gain penetration in these higher household
segments. It also encouraged retailers to manage and the primary target of supermarkets. Since around 70%
penetration and more frequently purchased categories.
differentiate their categories through more effective of US households own a pet, the losses suffered in this

This was followed by aggressive expansion of these

price discount attacks on personal care / health and
beauty care categories where traditionally supermarket
and drug store retailers had relied on higher profit
margins to offset lower margins in their food category
departments. Categories such as baby care, shampoos
and conditioners, toothpaste and toothbrushes were
targeted. In a relatively short period of time Walmart
captured significant sales in these categories from the
traditional retailers. In addition, Walmart’s significantly
lower operating costs provided a major disadvantage
to traditional retailers as they searched for response
strategies. Clearly, this was a very different competitive
landscape in the US and Walmart was writing the new
rules.

A similar situation was occurring in Europe. In the UK,

Walmart / ASDA introduced this US strategy in the
1990’s. In response, Tesco, in partnership with a third

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category hit very close to the core of a supermarket’s initiative was launched in the US in 1994 with the goal
business. Also the pet category was one of the most of developing new best practices in the key supply-
frequently purchased categories, was in the top 10 chain and demand management areas that impacted
categories in terms of sales, was growing at above sales and costs. Category Management was adopted
average rates and had good profit margins due to the as the core practice that was needed on the demand
lower price sensitivity of many pet owners. Categories side to better understand and meet consumer needs
with these characteristics were core categories for and, by doing so, prevent further inroads by the new
any supermarket retailer. In a period of just 3-4 years, competitors.
supermarkets share of pet category sales fell from
Similar competitive trends were occurring in the other
over 90% to under 60% due to the combined impacts
developed regions of the world. In response, similar
of the two new competitive threats – Walmart and the
ECR industry initiatives were also launched in Europe
“category killers”. Category killers also began to appear
in 1997, in Latin America and Asia-Pacific in 1998. In
in other categories, including soft beverages, juices,
all these regions, the same Category Management
ready meals and in health and beauty categories. It
principles, definition and business model that were
was clear that traditional retailers needed new methods
adopted as best practices in the US were endorsed
to combat the attacks on categories they had long
as the global standard for ECR demand management
dominated.
practices. Widespread adoption of these concepts
and methods occurred around the world as retailers
2. BRINGING THE CONSUMER MORE IN and manufacturers realized the ability of Category
RETAIL DECISION-MAKING Management to ensure that the needs of the consumer

∂ POS data -use and -sharing to complement consumer

were placed at the center of their marketing and Nestle and Unilever, were now faced with this new
CATEGORY MANAGEMENT
merchandising decisions. The era of retail consumer retailer Category Management capability and with
and shopper store productivity insights
marketing had arrived and Category Management the development of retailer branding initiatives. This IN THE OMNI-CHANNEL ERA
∂ The loyalty card opens new ways to build customer provided the platform for collaborative solutions. created a new dynamic in the traditional power balance - 2010 TO 2020 – BRINGING
relationships and insights between manufacturers and their retail customers. It
Leading global brand manufacturers were also quick
represented a new paradigm for these relationships THE SHOPPER INTO RETAIL
∂ Category Management as a data based language to recognize this new opportunity. Multi-national
to work collaboration between retailers and companies, including Coca-Cola, Procter & Gamble,
and new opportunities for more effective collaboration. MARKETING
manufacturers Category Management provided a “common language”
and platform for these new collaborative efforts. Global 1. NEW GENERATION OF CONSUMERS,
∂ The role of the category to manage traffic versus profit retailers and manufacturers were quick to adopt a single UPCOMING TRENDS AND MANAGEMENT
mix and how this translates into different category global best practice standard. This further accelerated
strategies and tactics
OF GLOBAL ISSUES:
the global adoption of Category Management methods.
∂ Efficient Consumer Response (ECR) becomes As mentioned previously, the origins of Category ∂ Health management, sustainability and ecology,
a global collaborative initiative with Category individuality, social responsibility, convenience put
Management can be traced to its use as a logical
Management as the umbrella; total system efficiency, societies, governments and the consumers in a new
method to respond to the significant changes that
store space management, direct product profitability context to change consumption & shopping choice
occurred in the competitive landscape of retailing in the
and data sharing are the leading methodology making, influencing strongly the category strategies &
early 1990’s. From its inception, Category Management
concepts. tactics;
demonstrated its ability to provide an effective platform
Category Management, which had been introduced as for more consumer-focused retail marketing and ∂ A new generation of consumers brings a shift in
a more consumer focused retail marketing approach in merchandising decisions. Since then, its acceptance buying power and urges companies to rethink their
the late 1980’s, offered a new approach for managing and use as a core business method has extended offer and the shopping experience
categories. It quickly appealed to more progressive across the globe and across all channels (supermarkets
retailers in a number of countries as a way to more and hypermarkets, drug, convenience, specialty, general
∂ The role of the category in these new shopping
missions, consumption occasions bring Category
effectively compete against these new forms of merchandise department stores) and all sectors of the
Management in a new cross category offering platform
competition. industry (retailers, manufacturers and wholesalers)
dictated by the Consumer-Shopper journey, which
It was also clear that an industry initiative was needed starts from the consumer need value drivers and
to help traditional retailers address these significant the consumption occasions which lead to where and
new threats. The Efficient Consumer Response (ECR) what the consumer’s money is spent on.

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In recent years, a new retail paradigm has emerged and offer (assortment), delivery convenience, online often one order leads to the visit of multiple delivery
with it new challenges and opportunities for retailers transparency of the competitive offers, mobile trucks in front of the consumer’s delivery point. Clearly,
and consumer product marketers. It has provided switching to compare across retail solutions, online this is not efficient, not ecological, nor practical. Total
new opportunities for the application of Category browsing quality, recruiting via social media. allows system efficiency with a sustainability constraint is
Management methods. A number of factors have the consumer to see her/his needs answered faster, already a focus of process re-engineering by online
shaped the current environment. cheaper, better informed and delivered where she/he retailers.
needs it at in the right time;
First is the emergence of a new generation of
Third, the rise of e-Commerce has put traditional
consumers and shoppers with different expectations These new trends have given rise to new retail formats
pricing and margin structures under pressure from the
and demands. Buying power has shifted from Baby not the least of which is the rapid growth of the
transparency of on-line pricing information. Finally, and
Boomers and Generation X to Millennials and post- e-Commerce channel. These new ways of shopping
potentially the most significant long-term impact, will
Millennial population cohorts. The new generation, led have totally restructured the way retailing and consumer
my Millennials, has a heightened interest in ecology, product manufacturing and marketing industries have
health, individuality, social bonding, sustainability, social operated in the past. The traditional supply chain
responsibility and convenience. These expectations and structure:
demands influence what products they buy and where
and how they shop. One significant change is the shift to supplier ∂ retailer ∂ shopper ∂ consumer
more local ecological/sustainable production and away
from global brands and multinational consumer goods is for some consumption universes (non-food especially)
companies. This has resulted in the increasing market evolving to be a new demand chain structure:
presence and share of new suppliers outside of the top
20 brand marketing companies. These new suppliers supplier ∂ shopping interface ∂
bring different business models. The imposition by
governments of new rules on health, nutrition and safety
These new values and expectations have an important logistical platform ∂ consumer
impact on the role of the category to win the shopping
of products and their ingredients in an effort to manage
mission. Consumers are influenced by their lifestyle This new structure has a number of significant
the rising cost of health care is another outcome of
in choosing where to shop and what to buy. Lifestyle implications for retailers and suppliers. First, where
the changing expectations and demands of the newer
defined by these new consumer values influences up until now the dominant market shares in many
generations of consumers and shoppers.
product choice in stores they trust to meet their values categories have been in the hands of larger multinational
and expectations. Bio-product shops and healthier manufacturers, we are seeing the rise of many smaller
product offerings not only enrich the assortment local producers who can simply add their products to
differentiation, but also enhance the retailer’s equity the product offerings of large e-Commerce platforms
towards aspirational expectations of consumers and (Amazon and Alibaba) but also to the platforms of
shoppers. The role of the category connects and smaller niche e-Commerce players that focus on
communicates the category to these values and consumption universe solutions (for example, Douglas.
expectations to win the shopping mission and the de in Germany specializing in cosmetic categories
shopper. The product assortment offered to the consumer has come from the shopper intelligence that is now available
expanded dramatically (Amazon’s 50 million sku’s from online purchasing. It is providing new insights
2. INNOVATIVE CHANNEL DEVELOPMENT versus the 40,000 - 50,000 offered in the traditional into consumer needs and solutions and purchase
TO REACH THE CONSUMER hypermarket / supermarket). Their assortment offer is transactions and behavior.
a thousand times bigger, as they can take on board
Similar to the factors that drove the initial impetus for
∂ ‘On the go’ store formats, ‘online-store’ developments many more items, and in most cases do not even have
Category Management, significant new competitors with
in retail bring the consumer and product user- to keep it in stock. In this new model, the role of many
dramatically different business models have emerged to
moments closer and blurs traditional shopping habits physical (“brick & mortar”) stores is shifting to be more of
challenge existing retailers. The rapid growth of global
a complementary convenience order pickup/showroom/
∂ Convenience and Price become heavy shopper amenity outlet in support of e-Commerce operations. on-line (“click”) retailers, led by Amazon and Alibaba, is
drivers in the retailer constellation, driven by new price the most visible example. The massive assortment of
Second, complementary to this dynamic, where
transparency and the convenience of e-Commerce products available through Amazon and Alibaba and the
consumers from the convenience of their home make
home delivery efficiency with which these retailers can deliver direct to
orders online, we will see a more eco-logistic product
the consumer has created a new standard of customer
∂ From physical store to omni-channel to opti-channel flow to bring orders to the place of consumption, in the
service that never existed in the era of “brick and mortar”
revolution. As price, multiplication of the online home, at a workplace or in another location. However,

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retailing. The consumer now has multiple options to Tesco.com and Bol.com. The intelligence they build integrated consumer-shopper framework for Category - structure to manage consumer and shopper-
choose from when doing their shopping – in store, on- from the on-line shopping behavior of their customers Management has become necessary. The value of interactions (social media, search engines, traditional)
line, mobile – and when receiving products – inside a provides a competitive advantage over retailers that Category Management today lies in its role in managing in a more strategic marketing logic, reshaping
store, at home, at a store pickup location. merely add an e-Commerce channel in their retailer a category within the context of the total “consumer drastically the traditional media solutions
solution portfolio. As will be discussed later, this provides and shopper journey”. The decision to purchase within
What is interesting is that most retailers, whether
the pioneers (Amazon, Alibaba, Tesco.com, Bol.com) a category is the end result of a number of steps that The Consumer & Shopper Journey
the traditional brick-and-mortar retailer or the on-line
with an important AI development opportunity. the consumer-shopper navigates prior to making this
decision. Category Management strategies and tactics The steps of the Consumer and Shopper Journey
There is little disagreement that the emergence of digital developed in 2011 by ECR Europe are shown in the
now get their direction from insights developed from the
shopping options and the acceptance of consumers Chart below. The need to consume or use a particular
steps in this holistic, integrated journey.
of this new way to shop have reshaped the world of category starts the journey. This need then triggers a
retailing and consumer goods marketing. Even though series of shopping decisions in which the consumer
the percentage of total retail sales through on-line THE FUTURE – INTEGRATED becomes the shopper. These decisions include a search
channels is growing it is still relatively small compared of reviews on options for categories and products that
to sales in brick and mortar store channels, a majority of CONSUMER AND SHOPPER meet this need. This leads to a shopping mission (for
shopping decisions are being made with some kind of MARKETING example, a full family shop, a fill-in shop or a special
on-line interaction and influence. A high percentage of occasion shop) to purchase the desired category and
shoppers now research product options and reviews on- 1. THE ERA OF SHOPPER MARKETING IN products, the choice of a preferred retail channel (in-
line prior to making a purchase decision and many post THE CONSUMER-SHOPPER JOURNEY store or on-line) in which to make the purchase and a
reviews on-line after they purchase regardless of the choice of an option within that channel (retailer format,
channel used for the actual purchase. On-line interaction ∂ Retailers become marketers to win the shopper with banner, website). Then follows the decision to buy within
has become a pervasive element in the overall shopping differentiating offers, store formats and media offerings a category and finally a decision is made on how the
process. based on insights derived from the Consumer and product purchased will be delivered to the consumer’s
Shopper Journey. point of consumption (shop in-store, pick up at store or
There is no doubt that we are now in the next generation
of retailing – the era of “channel merging”, of omni- ∂ The Consumer and Shopper Journey to integrate home delivery). The journey ends where it started with
channel retailing. To continue to have value as a consumer and shopper value drivers and the resulting the consumer evaluating whether the purchase decision,
management method, Category Management must and customer experience insights on expectations and by implication the shopping journey that led to the
has adapted to these new challenges by broadening purchase, met the consumer’s needs and expectations.
∂ The Consumer and Shopper Journey influence At every step in the journey the consumer has options
its original consumer focus into a more integrated
consumer and shopper approach.

“click” retailer, are now, by competitive necessity or the

demands of growth, migrating into an integrated in-store From Consumer to Shopper
/ on-line (“omni-channel”) operating model. Amazon and Category Management’s initial focus was on
Alibaba have led the way in opening their own stores, understanding consumer needs and behavior within
or acquiring existing brick and mortar retailers, as they each category. A key reason was the availability at
implement their integrated “online-to-offline” (O2O) retail that time of more information on consumers. In more
models to meet consumer needs regardless of their recent years, however, the focus has shifted to a deeper
shopping channel choice. Most brick and mortar retailers understanding of the shopper. Sources of information
around the world are also expanding their on-line web- on shopper needs and behavior have expanded
based shopping capabilities and offering a range of significantly and shopper insights derived from this
ordering and delivery options that serve both channels information have become an essential ingredient in the
(such as the “Click and Collect” shopping and delivery Category Management process. The primary role of
model that is becoming a common retailer offering for Category Management today is to manage the category
US retailers). in the most effective manner to influence both consumer
and shopper decision making and behavior regardless
In Europe, similar strategies are being implemented.
of whether the final purchase is made in-store or on-line.
In France, the “Drive” solution and in Belgium Colruyt’s
“Collect & Go” are examples. The true pioneers in
As consumption and shopping habits have changed
Europe, however, besides the invasion of Amazon, are
with the new generation of consumers, a more holistic, Source: ECR Europe Consumer & Shopper Journey Report 2011;
L. Demeulenaere & Associates

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to choose from and retailers and manufacturers have in the marketing arena will find its application in the
options to influence the consumer’s ultimate category Category Management process. But it will require some
∂ The redefinition of categories to reflect new
consumption habits, lifestyles and expectations (for
and product purchase decisions. re-invention to integrate new sources of information example plant-based as an ingredient in healthy meal
into base analytics to deliver solutions to the customer solutions replacing traditional dairy-based ingredients)
Category Management plays a key role in this
with relevancy, efficiency and effectiveness. New
broader holistic process. It is a key vehicle by which
retailers and manufacturers develop the strategies
base analytics because the “new” e-Commerce retail ∂ The integration of Category Management into the
formats get their intelligence from online behavior and broader Consumer and Shopper Journey construct
and tactics to meet the needs of their target consumer
and shopper segments and deliver a differentiated
less from loyalty card or POS data which had been the ∂ The application of Category Management principles
norm for traditional brick and mortar retailers. Today, and processes in e-Commerce channels
shopping experience whether in-store or on-line. This
Category Management adds value within the integrated
is accomplished by using consumer and shopper
consumer-shopper journey framework through the ∂ The use of more comprehensive multi-source
insights based on the consumer and shopper journey consumer and shopper data sets enabled by AI and
use of more comprehensive, multi-source data sets
that identify and quantify category growth opportunities, related technologies
that capture in a structured way how and why these
assign a category role, set category scorecard goals and
develop the appropriate category strategies and tactics
changing dynamics take place. ∂ The expanded use of Category Management in
to influence the decisions of the target consumer and In today’s omni-channel environment, integrated different channels (including DIY and Pharmacy) and
shopper segments as they navigate the steps of journey. consumer- shopper marketing is providing the strategic in new markets (such as China).
framework for Category Management to optimize the Later in this report a number of Case Studies are
A combination of consumer and shopper insights derived Consumer and Shopper Journey experience. The presented that demonstrate the current use of Category
from each step guide category and product marketing focus of Category Management initiatives is on those Management in one or more of these areas.
decisions. These insights define relevant consumer and Google, Facebook and Instagram, claim to be able to areas with the highest potential for category growth and
shopper segments for the category based on consumer competitive advantage. This will especially be true for
reach the consumer faster and easier than traditional Integrated Consumer and Shopper
consumption and usage-drivers. For any segment those segments that comprise the new generation of
advertising media. (Omni/multi channel is more a Marketing Models
(“Who”) the fulfillment of a consumer need evolves to reaction of the brick and mortar retailer who wants to consumer-shoppers.
a shopping mission (“Why”). The channel and retailer be also present in digital channels with an e-Commerce As has been the case since its inception, the evolution
We have identified five areas in which the use of
(“Where”) the consumer chooses to fulfill the need capability. Opti-channel is the retailer solution framework of Category Management methods will continue to
Category Management methods will continue to add
via that shopping mission is influenced by consumer where the consumer/shopper can get to his/her solution be driven by a combination of new consumer trends,
significant value in the next few years:
lifestyle and consumption value drivers that are best or product at the right time and in the right place,
reflected in the retailer image where they will go to following information offered in a multiple of channels).
complete the shopping mission. The role of the category
becomes a cornerstone that connects that mission of the There are now different influence points along the
target segment shoppers in such a way that it will drive Consumer and Shopper Journey. For this new
current and future category growth. Determining the consumer-shopper, creating value is more often
best category strategies and tactics to respond to the determined by how well the shopping experience
needs of this high potential shopper segment requires delivers “solutions” to their needs. This will often be a
the mapping of the opportunities and understanding the combination of categories and products brought in the
barriers and triggers at every step of the journey. The most convenient way, with the most relevancy, bringing
new challenge for Category Management is to achieve to life the aspirations of the consumer and where and
this in an omni-channel, digital marketing setting. when it has to be consumed or used.

Digital marketing and omni-/multi-/opti-channel business Retailers are re-inventing retail solutions to win in this
models have become the keys for activating the new new context to differentiate themselves in meeting the
consumer generations as they shift their shopping aspirational needs of the new consumers. New amenity
preferences from physical store to mobile and tablet, stores, On-the-Go outlets, show/demo-stores, combined
and research, compare, judge, and give opinions on with online services, experiences, influencing tactics and
their experiences using e-Commerce media. In the past new delivery logistics-chain concepts come to life every
10 years, there was a lot of attention given to digital day somewhere in the new world of retailing.
marketing which has replaced a significant proportion
of the traditional above-the-line advertising investments The consumer-shopper intelligence developed to
of manufacturers. Digital marketing platforms, such as create this relevancy and strategic choice making

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competition and technology. New application models collaboratively between the manufacturer and retailer This type of collaborative business model provides a
that reposition the role of Category Management within to develop and execute win-win consumer and shopper number of advantages:
a totally integrated, more collaborative framework of marketing initiatives designed to maximize a category’s
consumer and shopper marketing will increasingly come growth potential. In this model, Category Management
∂ Leverages the value of consumer and shopper
insights
into use. This will expand well beyond the integration plays two roles – first as the collaborative tool to define
of Category Management into the Consumer and the best mix of consumer and shopper marketing ∂ Deploys these insights across an omni-channel
Shopper Journey. This will be driven by the steady strategies and tactics to address the needs and behavior structure that captures shopper decision making in
growth of demand for digital shopping options by the of the target consumer-shopper segments, and second, either in-store or on-line mode
new generations of consumers and shoppers and the in how these strategies and tactics are implemented at
∂ Incorporates the Consumer and Shopper Journey as
availability of new, more in-depth and faster insights the point of purchase be it in-store or on-line. a roadmap for understanding consumer and shopper
into consumer and shopper needs and behaviors made needs and behavior across different channels
The starting point is the development of a Category
possible by new technologies and tools.
Vision. A series of steps then develop and implement
∂ Takes retailer-manufacturer collaboration to a higher
An example of an integrated collaborative Consumer customer-specific collaborative Category Business Plans level by leveraging the insights and resources of the
and Shopper Marketing model is the Category and that influence consumer and shopper expectations and retailer and the manufacturer and clearly defining the
Brand Building Framework shown in the Chart below. behavior and deliver category differentiation and growth roles of each in the total approach
for the retailer and brand growth for the manufacturer.
It describes a business process by which insights from
the Consumer and Shopper Journey deliver and connect Typically, the Category Vision is led by the manufacturer
∂ Enables category innovation and differentiation to
be key outputs and drivers of the future growth and
outputs from a consumer value driven category growth which normally has more of the research, data and development of the category.
vision with shopper choice making across channels and insights that enable a deeper assessment of the key
retailers. Category assessments confirm and quantify consumer and market trends that will drive development
where and how the category growth potentials can best and growth of the category over the next 3-5 years. 2. BIG DATA PROVIDING THE PLATFORM
be realized and how collaborative business plans can be the Category Vision. An important output of the
Insights derived from the Consumer and Shopper Category Vision work is often a revised category
FOR ARTIFICIAL INTELLIGENCE
optimized to deliver the category growth vision.
Journey framework then guide the identification of definition that reflects new consumer and shopper
This Category and Brand Building Framework consumer and shopper segments and their expectations Major paradigm shifts in retailing historically have
trends. The remaining steps of this framework develop
comprises three phases and a series of specific steps and behavior in the category. These insights, when been driven by one or more of three factors - changes
and implement the consumer and shopper marketing
which guide the internal and external work completed combined with the category growth drivers, produce in consumer needs and expectations, new forms of
strategies and tactics that best deliver the Category
competition and the availability of more insightful
Vision for the mutual benefits of the consumer, the
information made possible from advances in technology.
retailer and the manufacturer.
While all three will continue to mandate new business
Based on the trends and insights from the development models and management practices, it seems likely
of the Category Vision, an assessment of the category’s that technology will become a more dominant force for
current performance and growth opportunities is influence and change in the next decade. There are a
conducted in all major retail channels and for the target number of specific technology advances that seem likely
retail customers in each of the identified key markets. to significantly impact how retailers and manufacturers
This category assessment identifies barriers, purchase market apply Category Management methods to
triggers, and size of the category growth opportunity by manage categories and brands. At the forefront are
channel and key retailer. developments in Artificial Intelligence (AI) that unlock
the insights from Big Data. This provides the basis for
The output of the category assessment is a prototype
connecting the dots across multiple data sources to
Category Business Plan which follows the traditional
build detailed intelligence around the consumer and the
8-step Category Management process. This general
shopper.
plan validates and quantifies the future growth
opportunities in the category and provides an overall
roadmap for achieving this category growth within Artificial Intelligence (AI)
channels and with key retailers.
Advances in AI tools are providing significantly
The third phase focuses on the collaborative expanded analytical capabilities to identify breakthrough
development of customer specific Category Business new insights from the massive multi-source databases
Plans, including the development of shopper initiatives now being collected from all phases of the Consumer
Source: ECR Europe Consumer & Shopper Journey Report 2011; and tactics and a scorecard of KPI’s and performance and Shopper Journey. These insights are providing a
L. Demeulenaere & Associates measures to monitor progress and measure results.

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deeper understanding of the differences in needs and major media use and purchase channels. The ability to
behavior of consumer and shopper segments and how target the right consumer and shopper segments with
to meet these needs in the most convenient manner the right personalized incentives at the right time, in the
that reflects the consumer’s lifestyle, personal values right channel and with the right message will significantly
and time constraints. This provides the basis for more increase the efficiency and return on investment from
accurate and timely personalization in the development marketing and merchandising programs.
of 1-1 offers. It also allows the consumer-shopper to
AI is the process of gathering and applying deeper
interact and help decide in a preference-driven way (or
individual consumer and shopper insights to improve the
coded from past purchase history) the place and time
individual offer and related services. While most of this
of purchase and delivery. The battle among retailers
intelligence to date is captured from behavior tracking
to leverage the power of Artificial Intelligence methods
and/or app interaction to understand preferences,
will disrupt current purchase power spending dynamics
more aspirational or higher need dimensions can be
heavily, and even more so as the next generation of
added to go beyond what can be observed in current
consumers gains purchasing power and as technology
behavior. Marketing differentiation is about identifying
continues to expand.
undiscovered value drivers that arise from often smaller,
but very strong influencer consumer-shopper segments.
They drive and expand the interest levels of other
segments and capturing these insights first is the way
to a significant competitive advantage. For the Category
Manager this is about connecting and building on new
or previously unfound value drivers in the category and
exploiting these new insights via AI to design strategies
and tactics to build category growth. recruitment tactic using search engines, such as Google, better with which consumer-shopper segments
and work the consumer via popular search engines and and by doing so learning how best to improve the
3. TECHNOLOGY INNOVATION DRIVES smart social media digital marketing into their online offer, communicate promotions and simplify the
RETAIL INNOVATION offer. They build online behavior intelligence over time assortment.
and build stronger loyalty and market share as a result.
∫ For store managers it brings higher productivity
∂ Virtual store experience to capture the aspiration of Another factor is the online experience itself, the filtering, for the physical stores by allowing color-coded
the consumer
the visualization. Virtual technology will become a key visualization of planograms and store traffic
∂ Robotics in production, but even more in logistics to tool for making the proposition more personal, more pathways based on individual store level data
assemble the online order delivery basket attractive, and more easy to connect emotionally with to identify opportunities for improving category
the category and product. This technology will become sales, profitability and over/understock inventory
∂ Development of mobile intelligence from apps, mobile an important tool to support Category Management. conditions.
phone tracking to learn about aspirations, values,
Some of its uses will be to:
desires, preferences to make the offer more relevant ∫ For product marketers it allows for testing new
in the battle to win the customer in an AI build up ∂ Complement the physical store with virtual visuality product packaging preferences with online research
in the omni- channel context to expand the category tools and collaboration with product management
∂ Image recognition to capture behavior assortment offered to the consumer (often the online to improve package design and communication.
AI driven machine learning tools can identify linkages offer will be complemented with items that are not
between the characteristics of different consumer and carried in the physical store)
Virtual Store Experience / Virtual Reality Robotics
shopper segments and the impact of a impact of a
broad range of external factors and internal marketing
∂ Provide the consumer with a virtual product use
As the penetration of online shopping increases, experience before making a purchase decision A second area where new technology is likely to
and merchandising initiatives on the behavior of these consumers and shoppers are led into it either because have a positive impact on Category Management
segments. The depth, accuracy and speed with which of the younger generation, the discovery of stronger ∂ Reduce capital investment by adding virtual instead of is the use of robotic technology in retail. The multi-
retailers and manufacturers can understand how best to physical presence
convenience or better pricing, or by categories that functional capability of robots at retail is rapidly being
market their categories and products will create major connect better and create influence online to other ∂ Improve the future of research and machine learning: understood and many of the world’s leading retailers
new opportunities for growth. Integrated category and categories. The online experience success differs are implementing robot-based applications in their
∫ Virtual technology is an easier way to capture
shopper marketing programs will increasingly be driven enormously. The recruitment is a strong factor. stores and supply chains. While the focus so far has
preference driven purchase information and a more
by these new, more comprehensive insights derived Traditional retailers focus too much on converting their been primarily on addressing store operational tasks,
effective way to capture which solutions connect
from large multi-source databases that encompass all current shoppers. The winners now deploy a broader

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to improve the supply chain productivity and impact Image recognition 4. NEXT GENERATION OF SUPPLY
Category Management in what part of the supply chain LOGISTIC STRUCTURES FROM
process will be owned by the supplier and what is part The development of applications in this area will PRODUCT SOURCE TO THE PLACE OF
of retailer logistics. In the future a lot of products will impact a number of retail methods and applications. CONSUMPTION TO MEET THE NEW RULES
go directly from the supplier via a DC structure direct These include payment systems and interactive shelf ON ECOLOGY.
to the consumer’s home. In the physical store channel, communication with the consumer to influence category,
robot based automation will dominate in all aspects product and channel choice. In the next few years, ∂ Eco-driven home delivery supply chains
of merchandising from shelf replenishment, store image recognition will likely become the primary means
of consumer-shopper ID recognition replacing the loyalty
∂ Home refill replenishment solutions to build new ‘loyal’
operations, food treatment to cashier systems. habits via open shopping lists
card as is the case today.
Apps and Mobile Phone Technology It will provide data-based insights into shopping both
∂ Refill intelligent packaging to reduce waste
on-line and in-store by tracking and mapping how CO2 reduction targets, waste reduction, the
Interactive technology to connect, guide, and build consumers spend money and make their choices along development of the “convenience” factor in the logistics
intelligence will be dominating the shopper experience the consumer-shopper journey. As such it will enrich the of home delivery will lead to many new elements in how
more and more. NFC, Bluetooth, mobile big data data-based insights available to Category Managers categories are managed in the future.
analytics will make targeted offers, sampling, services to make improved decisions on assortment, new item Online retailers take orders, pass them through to their
more relevant and more productive. It builds the arsenal introductions, pricing and promotion. Learning more suppliers or their DC and often the consumer gets
of ways to interact with the consumer- shopper along the about the purchase decision tree will be an important three or more delivery trucks. These logistical solutions
steps of the Consumer and Shopper journey in the opti- outcome from the use of this technology. create traffic in the cities against the regulatory goals
channel world of tomorrow.
of CO2 level reduction and urban traffic congestion.
Mobile phone technology will impact Category Logistical solutions will be developed to rationalize and
Management in several ways: optimize all these product flows. Often the end delivery
∂ By capturing interaction insights for learning about the may be a drone or a coordinating delivery solution,
individual along the consumer-shopper journey - centralizing order delivery by delivery address. Starting
with new food eco-packaging solutions, with built in
such as store cleaning, the next generation of robotic ∂ What can we learn behind the preference driven chips will go along with such solutions, and extend to
applications will center on the collection of information choices and build on earlier identified value drivers
other categories over time. It will also connect with the
to enable management to maximize category and
product sales and profits. The use of in-store robots
∂ Which retail channels are browsed, visited consumer’s refrigerator to optimize the shopping list and
delivery schedules.
to more quickly and more accurately collect and ∂ Which journey experiences lead to the actual
communicate information on out-of-stock or low stock purchase (the store or online experience, the
recruitment tools (Facebook, Google), the price,
conditions, planogram and promotion non-compliance
type of promotion, product information provided
RECOMMENDATIONS
and pricing and shelf tag errors will go a long way
to addressing the number one problem that, since and so on. FOR RETAILERS AND
its inception, has undermined the ability of Category
∂ Mobile phone platforms carry most of the potential MANUFACTURERS
Management methods to achieve their full potential to bring all the relevant information a consumer
– the problem of incomplete or inconsistent in-store and shopper requires in front of him / her in mobile There is much that can be learned by understanding
execution of Category Management programs. Robots phone screen applications. As such the Category the evolution of Category Management methods over
can now collect a wide range of in-store information Manager has, in every step of the consumer- the thirty years since its introduction. The fact that it
that will significantly close this persistent “execution shopper journey, to identify what is relevant and has achieved global acceptance and application is
gap”. These new capabilities will provide more timely helpful to improve the shopping experience; in testament to Category Management’s ability to adapt
and more accurate information enabling retailers and which step of the journey should he/she be made to changing industry trends and new technologies. In
manufacturers to correct executional issues more aware of the potential consideration to purchase, such a dynamic industry as the retail consumer goods
quickly to the benefit of consumers, retailers and given the consumer value driver intelligence that marketing industry, it is rare that one business method
manufacturers. is known from the big data based intelligence has this kind of longevity. A key reason has been the
production. simplicity of its fundamental philosophy and its principles
Robotics will also become a critical productivity
and the compelling logic of its core business process
contributor in both online and physical store channels. In
represented by the 8-step Category Management
the online channel, robots will streamline order picking
business process. Its core proposition that the consumer
automation through to home delivery. This will continue

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Yesterday, Today & Tomorrow

which value drivers are better responded to in an

∂ Connect marketing and merchandising decisions
Category Management Best Practices to the primary and aspirational value drivers of e-Commerce channel versus the physical store
channel; which segments (younger consumer
spread around the world customers to build innovative propositions ahead of
competition generations, fashion influencers) drive other consumer
segments (e.g. older generations, followers) into
∂ Co-invest with manufacturers to improve the desired new behavior to gain faster critical mass behind your
price/quality equation of the category solution marketing investments
proposition, the convenience to shop it and to deliver
it to the place where it will be consumed and to be ∂ Update Category Management methods to adapt
able to communicate category solutions within the category strategies and tactics (especially assortment)
consumer-shopper journey communication structure to the role of the category in each of the retailer’s
channels; identify categories which may justify a
∂ Learn to operate in an opti-channel world where different role in the on-line channel versus the physical
the consumer is assumed to know all about your store channel and adjust strategies and tactics
competition across all channel formats; build a data- accordingly
sharing capability with your strategic manufacturers
to co-invest the influencing insights and media ∂ Collaborate with manufacturers to re-invent supply
investments along the journey systems given the new convenience expectations of
consumers and the new ecology regulations to reduce
∂ Be clear on where to focus first – understand which packaging waste and improve delivery efficiency
categories initiate purchase behavior change (non-
food versus food, luxury versus commodity etc.); ∂ Expand the focus of negotiation to include joint media
1995 1997 1998 collaboration and shopper marketing initiatives.
USA / North America Europe South America
Recommendations for Manufacturers

(and in more recent years, the consumer-shopper) must retailers and manufacturers can be best prepared to use For manufacturers, the key for success will be to
be at the center of all marketing and merchandising their Category Management to take advantage of the understand the new consumer growth drivers for the
decisions of retailers and manufacturers has stood tall new opportunities that are now taking shape. brand, the consumer and shopper segmentation that
as a guidepost for the industry to follow as it manages supports these drivers and how to market to these
through the various phases of its evolution. In times of segments at each step of the consumer-shopper
Recommendations for Retailers
dynamic change, Category Management has always journey. This will require new levels of collaboration to
offered a “back to basics” way of thinking and managing For retailers, the key for competitive advantage will be understand how brand segments connect with retailer
the business. This legacy has continued through until the ability to have the deepest possible understanding segments and new alliances to capitalize on the ability
now and will continue to provide a solid foundation for of consumer-shoppers, their value drivers and behavior of new media (especially social media) to activate
decision making as retailers and manufacturers manage across all channels and to leverage these insights to behavior along the journey.
new trends that emerge in the years ahead. develop and implement superior “category solutions” Some specific recommendations to create these
to the retailer’s most important consumer-shopper capabilities are:
In this paper we have traced the history of Category
segments.
Management and highlighted its benefits. However, ∂ Identify and update each brand’s consumer drivers
these will only continue to be achieved if retailers and Some requirements to create these capabilities are: to reflect lifestyle values and trends (health, ecology,
manufacturers take the appropriate actions within their individuality, budget consciousness, and so on) and
organizations to continually upgrade their capabilities ∂ Build consumer-shopper understanding to be able to map these brand drivers to high opportunity purchase
transition from mass marketing to mass customization
to gain maximum benefit from their use of Category growth segments for the future; connect these brand
to 1-1 personalization using Artificial Intelligence tools
Management methods. The key for achieving this will segments to likely retailer customer segments
to build maximum relevancy in the shopper proposition
be to fully leverage the value of Category Management
as a tool to win competitive advantage in the context ∂ Develop a strategic multi-source data intelligence ∂ Gain Category Management insights for these
segments along the Consumer and Shopper Journey
of the next trends that are shaping the industry. The masterplan to connect the various sources of
structure to understand how to capture potential in
consistent ability of Category Management to provide customer insights and use this intelligence to install
which channel/retailer
a competitive advantage has been its historical legacy. customer centricity as a core business philosophy
This will continue into the future. With this in mind, we across all functions of the retail organization ∂ Develop communication strategies and media
close the paper with some recommendations for how choice tactics along the same structure to generate

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Yesterday, Today & Tomorrow

awareness, consideration (influence), trial, re- and shoppers; second the ability to use these insights
purchase and recommendation (influence) to capture to differentiate and provide innovative new solutions
that potential value ahead of competition to consumers and shoppers that match their lifestyles;
third, the ability to adapt business practices to meet the
∂ Create alliances with e-Commerce retailers to new challenges; and fourth, the ability of organizations
capture online ROI of e-Commerce communication
to deploy these practices in their day-to-day work
investments, especially in social media
methods.
∂ Understand the cross-category and cross-consumer Since its introduction some 30 years ago, Category
segments that can have the most impact on expanding
Management has demonstrated its ability to
what consumers buy and where they shop in the new
adapt to new trends and challenges. This is a rare
channels to build a smarter opti-channel game plan
accomplishment in an industry of such dynamic change.
∂ Build a central data intelligence plan to evaluate As presented in this paper, this adaptability continues
consumer solution e-Commerce alternatives as new today. Category Management will continue to provide
logistical delivery structures arise. retailers and manufacturers with a key tool to meet the
challenges of today and those that will arise in the next
Conclusion phases of the retail marketing evolution.

The world of retail marketing has always been highly

dynamic driven by the continual changes in consumer Some Final Thoughts
demographics and lifestyles, the emergence of new In everything we do or write we have to understand
forms of competition and the development of new “why” we are doing it. For this ECR publication this is not
technologies. Today’s environment represents the latest different. More than ever we have to create a community
phase of evolution of retail marketing. More phases will that period and how Category Management delivers whether we are a brand producer or a retailer. This is all
of like-minded organizations and individuals to allow us
assuredly happen in the future. The ability of retailers essential outputs to better serve the consumer and the about how to build equity for our retail brands and our
to better deal with the new speed of change and to help
and manufacturers to successfully navigate and grow shopper. These outputs are better range offers, price product brands. The goal to build equity is to win in the
management continue to win in front of the customer.
their categories and brands in this ever changing setting, promotion selection and so on. mind-click of the consumer (the Who), from the ‘need’
The value of looking at the role of Category (the Why), and ‘buy consideration’ to ‘shopping mission’
environment will come down to four things - first, the Secondly it is to understand the ‘how’ to work Category
Management over the 30 years of its existence is in which your product or brand becomes a business
ability to develop a superior understanding of consumers Management, its decision-making algorithms and
firstly to learn about the major change triggers during opportunity (the What) or for your retail solution (the
processes, what data and research are used, the
Where). In this process, the consumer becomes the
functions that contribute to its success within the
shopper and the expectation of how this experience (the
organization (including the rise of the Shopper Marketing
How) is reflected in your offer determines whether you
as a strategic layer), the decision-making balance in
win or lose.
final delivery between the retailer and manufacturer
(with retailers having different approaches based on the The mechanism to convince the shopper (the Who)
sophistication of their implementation methods). that your offer represents a superior experience is what
we call SHOPPER MARKETING. The bringing it to life
There have been many changes over this 30-year
in the Consumer and Shopper Journey cycle is about
period. Consumer and shopper value drivers have
CATEGORY MANAGEMENT and communication at the
changed (see the paper provided by Ken Hughes), the
touch points along this journey.
intelligence to respond to these needs in a more relevant
way (from mass marketing to mass customization We hope that this publication inspires you to integrate
segmentations and now increasingly towards AI enabled these ideas and concepts into your business strategies.
1to 1 interaction), the multi-data source capability and This will force you to ask the right questions and
capacity, the game play between retailer solutions and specifically “Why do I still do it this way today?” and “Am
brand making. All of these changes require the re- I prepared for the dynamics that can set me in the right
invention on our methodologies, our human resource direction for a winning equity position?” We believe that
allocation and role definitions. helping provide the best answers to these questions
is the strategic role of the global ECR Category
Every business has to ask this question: “why do we
Management community for whom the project was
exist?” To whom and how can we bring added value and
undertaken.
do this better than the rest of market in which we play

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 Managing in Times of Crisis –
The Role of Category Management

Managing in Times of Crisis –

Insights and Learnings from
the Covid-19 Pandemic
The Role of Category
Management
Claudio Czapski, David Ciancio
and Brian Harris

SUCCESSFUL TRANSITIONING – these impacts will be only short term in impact; others
will create permanent change for all industry participants
“GETTING BACK TO BASICS” – consumers, retailers and manufacturers. While some
of the changes represent an acceleration of consumer
There is little doubt that one of the most significant and shopper trends that were already underway pre-
developments in the recent history of global economics Covid-19, others have been directly triggered by the
has been the Covid-19 pandemic. What started as a pandemic.
Black Swan event in China, it quickly spread to a flock
of Black Swans all over the world, with profound impacts In this new and constantly changing scenario, the rules
on health, lifestyles, living standards, needs, behaviors of the game have changed radically, both in operational
and priorities that have posed great challenges to all and strategic terms. For retailers, how to resolve the
people and sectors of business. Covid-19 is a crisis of most basic issues related to keeping the flow of the
astonishing proportions. “survival shopping basket” available along the entire
supply chain, from manufacturers to consumers’
Compared to the impact on some other industries (such homes, became the primary goal. For manufacturers
as travel and entertainment), the consumer packaged it depends on which of the following scenarios is most
goods (CPG) industry has been relatively less impacted. relevant. The “winners” are those manufacturers whose
The immediate challenge was to keep the supply of products are part of the currently demanded basket.
merchandise available to ensure that the basic needs The challenge under this scenario was how to have
of daily life could be met. However, the general success the production and delivery capacity to meet this much
of the short term remedial actions taken by retailers higher level of demand. The “losers”, on the other hand,
and manufacturers will be no guarantee for survival are those manufacturers whose sales have sharply
or success after the crisis. The expectations, values dropped or even completely vanished. Their challenge
and value proposition understanding of consumers is how to manage the cash flow necessary to stay afloat
are dramatically different from what they were prior until the most critical period is over and the market
to the onset of the pandemic. Shopper journeys, returns to some kind of more “normal” state.
shopping behavior and shopping baskets have changed
dramatically, and loyalty to products, brands, retailers However, in most companies the short-term pressures
and store formats became extremely volatile. Some of seem to overshadow the medium-long term strategic

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 Managing in Times of Crisis –
The Role of Category Management

issues, raising concerns about the best way to handle core values and the business methods that deploy these
both timeframes given the uncertainty not only about values.
the duration of the pandemic and especially the
Over the past two-plus decades Category Management
shutdown period, but also on its impact on the economy,
with its “back to basics” principles has helped retailers
international trade and consumer purchasing power and
and manufacturers adjust their categories and brands
demand in different markets and on local, national and
to changes, expected and crisis-driven, by bringing
international demand, production and distribution. We
shopper/consumer-centric strategies in a structured way
believe that the key for successfully transitioning will be
into internal day-to-day operations as well as externally
to adopt a systematic “back to basics” approach rather
in dealings with major business partners. In light of the
than overreacting to the new conditions. This needs
Covid-19 crisis, this process has again shown to be
to be driven by proven disciplined methods that have
more necessary than ever to ensure that any changes
been successful in helping retailers and manufacturers
in category and product decisions are linked to the
understand the changes in consumer and shopper
company’s strategies, to keep track of the changes
behavior and adapt to changes in the past, albeit with
in shopper and consumer needs, expectations and
less rapid impact than the Covid crisis.
behaviors, and to provide retailers and manufacturers
The good news is that several trusted business with the direction to act quickly to adjust the roles,
processes and tools, one of which being Category strategies and tactics of categories and brands to the
Management, can be relied upon to support quick new value propositions of consumers and shoppers. attention to price. Likewise, this implies price will be now concentrating their shopping and spending in
and effective responses to the most urgent business This requires, first and foremost, that the most likely key of increased importance as finances become more fewer stores. Conversely, only 16% of shoppers have
questions. This needs to be accomplished at the same impacts of the pandemic on consumers and shoppers uncertain. increased the number of stores that they buy from.
time as current strategies are reviewed and modified be understood.
if necessary based on relevant and more permanent This trend has a number of implications for retailers and Implications of this trend include:
changes caused by the Covid period. The key, suppliers. These include -
however, is that while strategies should be reviewed, IMPACT ON CONSUMER AND ∂ More shoppers will be completing full shop missions
successful current strategies should not simply be SHOPPER NEEDS, EXPECTATIONS ∂ Strong growth of private labels and discount brands in medium-sized store formats in terms of shopping
which will continue to outperform national brands frequency and basket size
abandoned or drastically changed as they represent AND BEHAVIORS
the company’s core values and strengths. In the past ∂ Spending on non-food will be constrained ∂ Increased demand for localized production, sourcing,
The Covid-19 pandemic has precipitated a number and products
decade and more, many retailers and manufacturers
of significant changes in consumer and shopper
∂ Growth of discounters will accelerate - provided they
have incorporated shopper/consumer-centric decision
expectations and behavior. While some of these
can offer sufficient category and product range for the ∂ Stronger strategies and tactics will be required to
making as a key element of their values, strategies and “first-stop” shopping mission retain new shoppers and win back lost shoppers
business methods. While it is prudent to review current changes will have only shorter term impacts, others will
strategies in light of the learnings from a major crisis, have longer term impacts on grocery shopping behavior ∂ Flush with cash, some retailers have been building up ∂ Increased focus on role of the store and retail brand in
and how retailers and manufacturers adjust to these a war chest and will be aggressive in pricing local communities
this is generally not the time to deviate drastically from
changes. Specifically, we believe that there are five (5)
trends that are likely to have a sustained impact.
∂ Manufacturers whose categories have suffered from ∂ New, disruptive local formats (trialed during the
declining demand and/or increased competition from pandemic) will expand. Examples are:
lower priced brands and private label products will
Trend 1 – Increased Emphasis on Value need more aggressive activation efforts to regain their
∂ Container stores and pop-up stores, like Tesco’s
Nightingale Hospital tent stores and Shoprite’s
Shoppers are adopting a more frugal approach to pre-Covid market positions.
Ekasi convenience stores in shipping containers
shopping. They are actively seeking ways to save
money, and are adopting savvy behaviors including Trend 2 – More Focus on Local Shopping ∂ Grocery Neighbour in Canada– a fleet of trucks
that will each operate like a supermarket on wheels
better management of household food waste. Value Shoppers are making fewer trips, filling larger baskets,
becomes more important as a driver of store and and staying closer to home for their grocery shopping. ∂ Sysco@Home – distributor of food products to
product choice, especially for the growing segment of There is also less cross-shopping, but formats and restaurants and hotels now offering delivery to
price-sensitive shoppers. channels are still shifting as shoppers settle in to their regular households

In the post-Covid recessionary environment, the new preferences in a post-Covid recovery period. ∂ Instagram app take-out and delivery from local
importance of price in purchase decisions is likely QSRs and restaurants
Shoppers are shopping at fewer stores. A recent
to increase. It is not surprising that pre-Covid virus
prosperity reduced the need for shoppers to pay
dunnhumby study found that 41% of shoppers are ∂ Online farmer’s markets

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 Managing in Times of Crisis –
The Role of Category Management

the early stock-ups met with out-of-stocks for many more-mature online grocers. The crisis has
in traditional footprints, the imposition of stimulated the long-anticipated tipping point up to 15+%
shelter-in-place or local-only (e.g. Italy) of sales revenues.
Evidence suggests that shoppers orders, or due to insecurity or fear.
Implications of this trend include:
are continuing to shop smaller store These smaller stores are characterized
by a more limited range but also a ∂ Increased opportunities for smaller formats and
formats and away from the larger stronger local-community ethos. It should
footprints as shopping preferences shift to being more
local
superstores, even 10 to 12 weeks be pointed out, however, that this trend
towards shopping in more geographically ∂ Stores need to be redesigned to adjust traffic flow to
after the outbreak. convenient and easier-to-shop formats meet the needs and concerns of social distancing
was clearly underway in many markets
around the world prior to the pandemic.
∂ All retailers, large or small, must offer online ordering,
delivery and store pick up services. This is another
The importance of convenience is higher
trend that was underway pre-Covid-19 but has
Trend 3 - Shifting Formats and Channels for the new generation of consumer/
been accelerated by the pandemic and requires the
shoppers. A study in one major European market
Shoppers shopped larger stores during the early deployment of aligned omni-channel strategies, tactics
revealed that over 30% of a major retailer’s sales
stages of the pandemic. Hypermarkets and larger and operations
come from consumer/shopper segments for whom
superstores were a preferred format in the early stock- convenience is a major influence on shopping behavior. ∂ Services that maintain shopper loyalty will become
up phase in most countries. But sales growth in the The pandemic only served to accelerate this trend. even more critical as shoppers concentrate more of
hypermarket formats declined markedly after the initial their shopping in fewer outlets
phases, most now showing mostly negative like-for-like Evidence suggests that shoppers are continuing to
performance (with few exceptions). Except in markets shop smaller store formats and away from the larger ∂ Retailers and suppliers must understand the shifts
superstores, even 10 to 12 weeks after the outbreak. that are occurring in category purchasing across
where hypermarkets are structurally predominant (e.g.
For example, even Costco reported global sales falling channels. Grocery retailers should look at a broader
Chile), the crisis signals another worrisome challenge for
-0.5% in April vs. previous year (its first sales drop in competition world, where drugstores, category killers
hypermarkets. This format must find ways to attract new This channel will continue to own the first-commodity
years) after stock-up growth in March of +9.6%. Smaller and specialized stores (even door to door sales or
revenue streams, for example, using larger footprints for shopping list post crisis.
formats have captured the “first-stop shop” mission, other formats provided by manufacturers) have to be
online-shopping and click & collect fulfillment hubs.
especially those modern convenience operations As mentioned previously, more local and significantly taken into account.
Shoppers switched quickly toward smaller store and that combine an EDLP consumer value proposition. less cross-shopping is occurring. In line with the trend of
convenience formats as their preferred channel after shoppers shopping within their local community during Trend 4 – Increase in Food@Home
the pandemic, there has been a significant reduction
of shoppers shopping across chains. A research study As a result of the pandemic, 20% of households are
conducted by dunnhumby shows that the number of preparing more meals from scratch; 25% are eating less
shoppers shopping at only 1 store increased by 19% pre-prepared foods; 33% are buying more frozen foods
compared to a year ago whereas the number shopping and 50% are freezing more fresh foods. With social
3 or more stores is down more than 44%. distancing restrictions likely to become the new norm,
food-away-from-home spending is expected to improve
In some countries, such as Brazil, studies indicate that
somewhat but will likely struggle until a vaccine is widely
shoppers are still doing their bigger “monthly shop” for
available. For restaurants, café’s and QSR’s, social
groceries and household cleaning categories at cash-
distancing requirements will limit available seating.
and-carry outlets but are making more use of online
ordering and store pickup options. They have also Limited mobility is also a factor that limits food-away-
switched more of their purchases of fresh categories, from-home for households with at-risk members.
and health and personal care, baby and confectionary It is estimated that up to 40% of households have
categories to smaller, more local formats such as vulnerable/at-risk members.
supermarkets, specialty stores and drug stores.
Shoppers continue to show a stronger interest in skills
Demand for online ordering and delivery services for home cooking. The place for “food adventure” is
has skyrocketed. Retailers have been unable to meet shifting from restaurants to home. The growth of home
capacity demands in spite of best efforts. Online sales offices has been an additional reason for more food
will stabilize at 2-3 times the pre-Covid percentages being consumed at home.

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 Managing in Times of Crisis –
The Role of Category Management

in this section and decide, for their categories and Category Definitions - There are several likely impacts
brands, which trends, whether pre-pandemic or new, will of the Covid experience on how categories are defined
have the most pronounced impact on their businesses and structured. Some attributes will become more
going forward beyond the pandemic. important to consumers in their category and product
purchase choices. Product safety and health attributes
will become much more important attributes on the
NEED FOR CLOSER Consumer Decision Trees (CDT) for many consumable
COLLABORATION food and HPC categories. The importance of locally
sourced and produced products is also likely to increase
One of the key learnings from the Covid crisis has been
making this a more important purchase attribute for
the need for a serious review of pre-Covid methods
many consumers and shoppers.
of retailer-supplier collaboration. It is clear that the
more traditional ways that retailers and suppliers have Another key learning has been the willingness of
conducted business with each other largely fail when
“normal” business conditions no longer apply as was
the case in the early days of the pandemic in virtually
every developed country in the world. The pandemic
has brought into clear focus the need for more intensive
and effective collaboration between manufacturers
and retailers with more jointly made decisions based
on shared information and aligned strategies. The
challenges posed in trying to respond to the first
There are several implications of this trend, including: Some of the implications of this are: peak demand weeks put the need for more effective
collaborative business planning and execution into clear
∂ Increased penetration of fresh and frozen categories ∂ Retailers and suppliers need to help consumers and focus. This lesson should encourage both retailers and
across the shopper base shoppers become more knowledgeable about food suppliers to put in place collaborative business planning
and nutrition, physical and mental wellbeing and at-
∂ Demand for meal planning and a wider store cupboard home entertainment in their marketing programs
practices both to be better prepared for future more
repertoire sudden demand shifts as well as longer term changes,

∂ Innovation for take-home solutions will accelerate e.g. ∂ Employee physical and mental wellbeing will be more discussed in the previous section, in consumption and
closely watched shopping behavior that the pandemic has set in motion.
takeaway meal deals or recipe boxes, drive-throughs,
In this context, Category Management with its core
third-party delivery solutions, and dark kitchens ∂ There will be significant growth opportunities for new principles and process that stress the importance of
products in new personal protection and health care
∂ CRM content and online platforms will be used to categories
collaborative Category Business Planning will be an
educate and inspire, e.g. recipe channels and food even more essential component of a post-Covid success
adventures ∂ The heightened interest in personal hygiene offers an strategy. The good news is that the benefits of more
opportunity for more pre-packed products collaborative Category Business Planning has been
∂ More cooking and health advice and services will be clearly and consistently demonstrated over many years
provided in stores and in digital shopping channels ∂ There will be an elevation of animal welfare concerns in many countries.
as it relates to food processing
Trend 5 – Elevated Interest in Personal and
Societal Wellbeing The ability of Category Management to help facilitate a IMPLICATIONS FOR CATEGORY consumers during these high demand situations to
smooth post-crisis transition and to identify new category MANAGEMENT substitute one product for another if their first or usual
Covid has profoundly impacted basic values, resulting and product opportunities that have been created by
choice is not available. This presents the opportunity for
in a general desire for a kinder, more empathetic, and the pandemic must start with a clear understanding The Covid experience has highlighted a number of
the use of broader definitions of some categories (e.g.
humane society, as well as a lifestyle with increased of the new needs and expectations of consumers and specific implications for how Category Management
broader definitions of categories such as Household
focus on personal and home hygiene practices and shoppers. This “back-to-basics” approach has always can best assist a smooth transition to the post-Covid
Cleaning, Personal Hygiene, Home Cooking). With
healthier eating and habits to build immunity. The advent been the foundation for the successful use of this business environment. Some of these are identified in
respect to the area of Home Cooking one US study
of social distancing and working from home has drawn business method and we believe that it will again prove the next section and are presented in terms of specific
found a dramatic increase in meals prepared at home.
family members closer and stimulated shared activities to be an important element in a post-Covid transition. steps of the traditional best practices 8-Step Category
The study found that almost 60% of US consumers are
of all kinds. Retailers and suppliers need to carefully analyze the Business Planning process.
now preparing more than 90% of their meals at home.
impacts of the consumer and shopper trends described

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 Managing in Times of Crisis –
The Role of Category Management

Since the sales mix of in-store and on-line purchases as Amazon. (A US study by Mercatus revealed that in the heightened importance of any new attributes) as
will vary a lot across categories, retailers will need to the first week of March there was a 305% increase in the key tool for deciding where in a category is most
consider the possibility of having two Roles for some the number of on-line orders, 92% of which were first appropriate to reduce the product assortment.
categories (one Role for the in-store and a different Role timers. Only 30% of on-line orders in the last week of
There has been a growth in private label product sales
for the on-line part of the category’s business). This will March, however, were first time orders suggesting that a
for several reasons. First, consumers’ financial situations
require an accurate analysis of the in-store / on-line mix significant percentage of the initial first timers continued
have been adversely affected by the economic turmoil of
of sales across categories. to order on-line). This trend needs to be
carefully studied. Retention strategies will
Category Scorecards - Operational KPI’s will get more
be important in categories that have high
priority as category scorecard performance measures
penetration in the on-line baskets.
(e.g. Out of Stock (OOS) levels, inventory levels, service
levels etc.) Category Tactics - In keeping with the
Category Strategies that focus

Category Strategies - Specific strategies by category

disciplines of Category Management, on creating a Health Image and
tactical decisions should be directly
will be needed to attract and retain shoppers given the a Product Safety Image will also
linked to Category Strategies. There is
changes in how consumers shop and their expectations
little doubt that one of the biggest tactical
for categories, products and the shopping experience
changes will be in the area of category
likely become more important in
by channel and possibly by store format. Category
Category Management principles would supports the Strategies that focus on creating a Health Image and
assortments. This will impact many many categories.
idea of developing a more comprehensive definition of categories and the adjustment will mainly
a Product Safety Image will also likely become more
a Home Cooking category. Historically, broadening the be in the direction of a reduction of the
important in many categories.
definition of a category has been a source of competitive assortments offered. During the Covid
advantage for both retailers and manufacturers. Strategies that focus on ways to retain the large number period, many, if not most, consumers
of first time on-line shoppers that tried a retailer’s on- reevaluated how much assortment they really need and rising unemployment. As a result, less expensive private
Category Roles - Roles for many categories will need in which categories assortment is less important than it label products have become a more necessary purchase
line channel during the Covid period will be important.
to be redefined. Basic categories that have traditionally used to be. It will be important to use category Consumer option in many categories. (One study concluded that by
The risk is that post-Covid, these shoppers might
been managed as Routine Role categories, such as Decision Trees (adjusted if necessary to accommodate March 31st one-third of US households had experienced
simply return to more established click retailers, such
paper products, household cleaning, pasta and canned a downturn in their financial condition). Second, many
goods, might need to be managed as Destination shoppers have been more willing to switch to a private
Role categories given the heightened importance they label alternative given the lack of availability of many
have during these kind of crisis periods. Developing leading manufacturers’ brand products.
adequate sources of supply and resupply for these
categories will become the key for gaining Destination Another impact on assortment will be the growing
during these periods. Having Category Business Plans importance of larger pack sizes as consumers reduce
already developed for how to change a category’s role their frequency of shopping trips to stores. This will be
at the outset of an emergency would be a sound way of especially noticeable in categories that have higher
making these adjustments when needed. priority for in-home stock up.

There will likely be less Convenience Role categories We will also likely to see a reallocation of store space
as consumers evaluate their need for impulse driven among categories based on these assortment changes
purchasing. Also there is likely to be less browsing and the need to reduce OOS issues in the future.
during the shopping trip, especially if, as expected, Some categories will get more space, others less.
retailers continue to enforce social distancing practices Category Roles will play a factor here. Store layouts
while shopping. Shoppers are likely to be more are likely to also change as retailers adjust layouts
conscious of avoiding any crowding in aisles and will and merchandising to accommodate social distancing
focus their shopping on the efficient selection of their requirements in traffic flows in aisles. The new goal will
planned purchases. Shopping trips and missions will be to layout the store in such a way as to more evenly
be more focused on purchasing for planned needs and balance out traffic flows in aisles across the total store.
categories and products that fit this mission. Less time Planograms will also change along with the changes in
and attention will be given to browsing and impulse category assortments. Shopping-efficient planograms
purchasing. will become more important as shoppers adhere to
social distancing during shopping. Cross-merchandising

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 Managing in Times of Crisis –
The Role of Category Management

will also become more important for building sales

to address the likely reduced level of browsing by
shoppers. The use of in-aisle displays is also likely to be
reduced to facilitate in-aisle traffic flow.

Another interesting area for category tactics will be the

impact on promotions. Early in the Covid crisis Walmart
USA has announced that it was cutting all promotions
until June. Other retailers are also eliminating their
weekly circulars. These drastic changes will likely
be only short term until demand patterns stabilize.
However, the learnings from the crisis will provide a
new opportunity to reevaluate many of the traditional
promotion tactics. This includes what is the best type
of promotions and how should promotion tactics
vary across categories given the changes that have
occurred in category importance and shopping behavior.
The Covid pandemic has caused both retailers and
consumers to question the value of promotions in this
kind of crisis environment. However, after the pandemic
is over, how to deploy promotional tactics, especially
in categories that had reduced levels of demand and
are most likely to be hit with rapid increases in demand.
visibility during the pandemic, will be an important
decision for retailers and manufacturers. In summary, as is usual in any period of unexpected
change, the Covid crisis and learnings from it will open
Finally, the Covid pandemic has pointed out some
up new opportunities for business growth for both
areas of great vulnerability that may benefit from a full
retailers and manufacturers. The key will be to use this
re-design, especially if this is done as a joint effort of
opportunity for a “back to basics” assessment of how
manufacturers and retailers. The most exposed area
the company goes to market. Since its introduction in
certainly has been the existing supply chain model.
the late 1980’s, Category Management has provided
The current “just in time” model failed in being able to
sound principles, disciplines and methods
to understand and successfully capitalize
on changes that have occurred in the
needs, values and expectations, and
behavior of consumers and shoppers.
The Covid pandemic has caused Retailers and manufacturers that have
both retailers and consumers to sound Category Management capabilities
are better equipped to understand new
question the value of promotions in trends and to take earlier advantage of
these changes and opportunities, both
this kind of crisis environment.
in times of regular business as well as
when facing unexpected and high impact
changes, be it a crisis such as Covid 19
or opportunities provided for example by
technology innovations such as artificial
support such a dramatic unplanned demand surge in
intelligence and machine learning. As has been pointed
many products and categories. This may give rise to a
out, Category Management will continue to provide the
renewed interest in re-designing the entire supply chain,
fundamental consumer-shopper centric disciplines and
implementing a more efficient “safety stock / quickly
methods to make the transition during any period of
available inventory” model especially for categories that
challenge as quick and as successful as possible.

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 The Social Science of
Shopper Marketing

The Social Science of

As theories evolved, Shopper Marketing took over, live in a vacuum – it is a smaller part of a bigger life.
focusing on driving demand through deep shopper I have never separated ‘shoppers’ from ‘humans’
insight, widening the responsibility of your average (although with AI and virtual assistants those days are

Shopper Marketing
‘Category Management’ role. Gone are the days of coming). The purpose of this article is to address this
planograms and range management Excel sheets being imbalance. To focus on how we can apply a social
the output. They are simply the foundation onto which science understanding to build better Shopper Marketing
we build. strategies.

Ken Hughes I have been involved in Category Management, Shopper You too, are a social scientist. If you have studied
Marketing and Shopper Insight for over 20 years. I have Management or Marketing, your qualification is in the
played the role of analyst, consultant and strategic social sciences. It is time to put some extra tools in the
FMCG Retail is an operations business. Margins are However, 100 years later, while there have been advisor for both suppliers and retailers. I have been toolbox when it comes to retail management.
tight and as such, the focus is often on volume and amazing improvements on the supply and operational involved in Category Vision projects globally, and seen
In 1920s New York, Edward Bernays (Sigmund Freud’s
efficiency. It is about logistics and stock availability, side (think chilled distribution networks, AI powered the same issues and problems again and again. FMCG
nephew) opened what would later be recognised as
scale and market share. On a day-to-day basis, any supply management, Ocado robots picking stock, retail does not properly understand shoppers.
one of the worlds first PR agencies (or marketing
given manager of a supermarket is more concerned even self-checkouts), we are significantly behind on What is missing from retail management theory, agency). Known as the father of public relations,
with the Supply element – that the shelves are full, implementing demand management insight. specifically Shopper Marketing, is a deep social science famously promoting female smoking in 1929 by branding
the tills are open and the machine that is a modern understanding. The study of the natural sciences cigarettes as feminist ‘Torches of Freedom’, he was
There have been various retail management theories
supermarket is up-and-running. (physics, biology, chemistry, astronomy) help us a man that took his uncle’s work and applied it to
that have driven further efficiency and scale in retail.
It has been over 100 years since Piggly Wiggly Trade Marketing and Promotion ensured brands get understand our physical world. The study of the formal influencing shoppers.
launched that infamous first self-service supermarket in the space, visibility and support they require on an sciences (mathematics, logic, decision theory) help us
Traditionally, persuasion was functional, listing product
Memphis. That was the moment the Demand side was otherwise cluttered shop-floor, and also ensures the understand systems and form definitions. But it is the
benefits. Guinness famously used its ‘Guinness is Good
born, the moment the shopper had control to choose retailer of a critical additional revenue stream other than social sciences (anthropology, psychology, behavioural
for You’ tagline for decades. Cars, TVs and refrigerators
one product over another, where impulse purchases margin. Space Planning & Range Management ensured economics, sociology) that help us understand people.
were sold on benefits and attributes. But all that
were possible based on adjacency rather than a that the right product was in the right place, minimising I have dedicated my career as a Consumer & Shopper changed in the 40s/50s as the advertising industry took
grocer suggesting them. It was the birth and catalyst of out-of-stocks on shelves and removing slow sellers. Behaviouralist to answering a single question. Why Bernays early work and realised the power of emotive
branding, packaging and the core fundamentals of what Category Management added a layer of shopper insight do people buy, often followed by a second question, persuasion. Think of the American Mad Men TV series.
would later be called Space Planning and Category into the mix, looking at inter-relations and adjacencies how can we make them buy more? I am a social
Management. and how a shopper might expect to see products The power of fear, lust, sex, jealousy, desire, wealth,
scientist, fascinated by how humans do it all – how
displayed. status – these were all far more powerful in persuading
we live, love, work, and dream. Shopping does not

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Shopper Marketing

shoppers to buy than listing attributes and benefits. Some were empty and so you too walked on past. sales reports in FMCG but the ‘Opportunity Cost Report Because when a shopper took a cart it told them there
And so, the advertising industry learned to lean into Rarely will a consumer be the first to sit. It is why (Lost Sales’ is one that is missing from most desks). was a ‘dedicated space’ for fruit and vegetables, the
the social sciences. How were consumers living their a waiter will seat customers at the window or front penetration of the category increased by 102%. That
So back to herding – why don’t we re-capture some
lives (anthropology), what did people want from life immediately, to encourage others to follow. More likely means that twice as many shoppers bought something
of these lost sales by making it easier for a shopper to
(sociology), how did people make decisions (behavioural you ended up eating in the next restaurant that had a from the fruit/vegetable department because their
choose something from large ranges. Amazon does this
economics) and how is desire stimulated in a consumer few occupied tables, seems a safer bet. Herding – we shopping cart told them to!
every day. ‘People like you also bought…’ Converting
(psychology)? Look at any modern marketing follow the crowd. This is primal, you can’t stop it and it
an aisle-end to hero top selling products is easy. Target We like to fit things into boxes, follow the herd. We need
communication and you will see evidence of this. Buy happens at a sub-conscious level.
famously did this for hair and beauty products, an to look at Herding and Priming as every day occurrences
this and your life will be better.
So how should we bring this to life in FMCG retail? infamously cluttered aisle. Telling shoppers that these in FMCG retail and utilise the sub-conscious behavioural
So, we know all this, and yet somehow, as a shoppers’ Many categories are over-ranged, and the paradox of are the Top Three selling Shampoos, Conditioners and brain of our shoppers.
foot crosses the threshold of a supermarket, we forget choice kicks in for shoppers. Too much choice and it Skin Care products in the US makes it much easier
it all and put yellow stickers on products to increase becomes too difficult to make a decision and we walk to make a decision when faced with an aisle of 750+
volume sales. Pile the product, promote it and job done. away. It happens everyday at every category in every SKUs. SOCIOLOGOY
Why is most of FMCG retail one of the last environments supermarket.
Priming is another behavioural trick up the sleeve. We Let’s move on to how people live in modern society and
and industries to adopt a true understanding of shopper
I spent years setting up cameras in supermarkets can easily prime someone to behave in certain ways see how we might use that in Shopper Marketing. What
psychology? Why do we insist on using blunt tools like
observing hundreds of hours of category/shopper or respond to a certain stimulus. When a supermarket disappoints me often in Shopper Marketing campaigns
promotion and trade marketing to leverage incremental
interaction. We don’t usually measure walkaways pumps the smell of chocolate into the candy aisle or is the lack of real insight in to the lives of the shoppers
sales, giving up precious value sales? While Shopper
in FMCG retail. We can measure online basket fresh bread into the bakery, they are priming shoppers. we are trying to influence.
Marketing has gone some way to addressing this, it still
abandonment easily, but in real store environments it However, sometimes it can be much easier than that.
has far to travel. Take the meal solution issue. We all know that every
is more difficult. There wasn’t a category vision project
Colin Payne, a researcher in the State of New Mexico day, in every home in the world, someone ponders
As an example and structure, I am going to dip into four I worked on where the supplier and retailer were not
famously demonstrated this with his ‘Yellow Tape what to make for the dinner. Supermarkets are not
of the social sciences here and propose a better way astounded to see the walkaway rates. Until the cameras
Shopping Cart’ experiment. He took nothing more than particularly designed to help address that question.
to engage shoppers. While Category Management and went in, no one had every measured it before. There
a simple printed sign and a piece of yellow sticky tape, With so many products and categories, it becomes a
Shopper Marketing have elements of shopper data and were sometimes more shoppers walking away than
and placed both on every shopping cart. The tape divided little overwhelming for shoppers, and so they end up
insight, most of it can be very two-dimensional rather buying. Opportunity everywhere but until you measure
the cart around the 20% mark, and the sign read ‘Please buying the same brands from the same categories over-
than actionable. It is time we got inside the mind of the it, until you see the issue, it remains invisible. We love
place your fruit and vegetables in front of this line’. and-over again. The average shopper buys just 350+
shopper.

BEHAVIOURAL ECONOMICS
Behavioural Economics concerns itself with the
psychology of decision making. While standard
economic theory would argue a shopper weighs up the
cost and benefits of a purchase, this linear model is fine
Priming is another behavioural
in theory but not in practice. In real-life there are many trick up the sleeve. We can
factors that influence purchase, many of them outliers.
easily prime someone to
What we want is a shopper to put something in their
basket, preferably from our brand, category or store. behave in certain ways or
We need to trigger that purchase. Let me give you two
simple behavioural realities that are often used by other respond to a certain stimulus.
industries but rarely in FMCG. When a supermarket pumps
The first is HERDING. Humans are tribal animals, and
the smell of chocolate into the
as such recognise primally that there is safety in the
herd. If your caveman friend ate the berries on the bush candy aisle or fresh bread into
yesterday and is still alive, then it is probably safe for
you to eat them too. We are followers. the bakery, they are priming
Think of the last time you were walking along a shoppers.
promenade on vacation trying to chose a restaurant.

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Shopper Marketing

SKUs a year, often from a supermarket ranging 10,000- busy family and social days, with children having after with all the ingredients you would need to make the meal By simply putting animal paw prints on the aisle floor,
20,000+ school activities or the consumer themselves having a there to hand, chilled and ambient, the recipe card ready images of cute puppies and kittens throughout the
gym or class to get to. Time pressure was also high on to grab. These displays were then re-merchandised on aisle and reminders to treat their pets who they’d left at
So how might we use a better understanding of their
the need-state agenda. Thu-Fri with indulgent meal solutions (think Chicken home all day (guilt!), engagement and sales shot up. No
lives to increase category engagement?
Fajitas) and finally swapped out again
Thursday to Friday saw a marked swing toward
Take a very simple category, like Fresh Chicken. I on Sat-Sun with meal solutions around
Indulgence. Meals became slower, calories less
worked on a Shopper Marketing project a few years sharing and family (traditional roast
counted, more time to prepare. Friday night dinner has
back for a supplier, and they invested heavily in shopper chicken etc.)
far more indulgence and treat elements than a Monday. By simply putting animal paw prints on
understanding. As well as all the usual focus groups,
Now this sounds so simple, but without
at fixture interviews, cameras in-store and one-to-one Finally, Saturday and Sunday, Social aspects to cooking the aisle floor, images of cute puppies
matching a shopper need-state, their life
shop-a-longs, we also did an extensive in-home diary and dining took over. This was all about family and
exercise, looking at what shoppers were eating and friends, good food and good company.
outside the store, to what and how you and kittens throughout the aisle and
are offering them inside the store, you
cooking, and how this varied between groups. remainders to treat their pets who
So why am I telling you all this? Well put simply, most will always be playing catch up to the
One of the insights that emerged, deliciously simple (as FMCG retail promotions offer a cookie-cutter meal incremental sales.
they’d left at home all day (guilt!),
the good ones often are) was this – the way shoppers solution across the week. In fact most promotion
PSYCHOLOGY
were preparing and consuming meals across a given cycles in-store are 2-3 weeks, offering the shopper the engagement and sales shot up.
week had a pattern, and only products that fitted into this same thing at every visit. But that does not match the Shopper psychology is a fascinating field
pattern or need-state would be considered. sociology of how shoppers live their lives and prepare/ in itself, one that we could debate for
eat their meals. days. But an understanding of the human
From Monday to Wednesday, shoppers tended to mind and how it works is key if we are
prepare easy, quick and healthy meals. They had Our Fresh Chicken client acted on the insight and price promotion, no loss of margin. Shopper Marketing
to trigger sales in ways other than yellow stickers and
perhaps overdone it at the weekend and wanted to designed an impulse fridge selling meal solutions, at its best – identify the psychological button behind
display. Shopper Marketing has to lean more heavily on
start afresh on Monday (thus the health aspect – diets changing by week-part. On Mon-Wed there were images behaviours and you can change them.
shopper psychology to truly evolve.
always restart this Monday!). These days were also of healthy Chicken Caesar Salads or Chicken Stir-fry, Shoppers are human, full of hopes and dreams, fears
Returning to the earlier discussion about Edward
and uncertainties. Learn which button to press per
Bernays and the power of emotion to trigger product
category and be creative in terms of how you press it.
desire (his uncle Freud was all about desire!) let us look
at another case study, this time Pet Food. CYBER BEHAVIOURALISM
Those shoppers who own dogs and cats love their Lastly, let’s talk about a relatively new field, that of
pets, often more than their children! While working on a cyber-behaviouralism. This is the study of how we live
project for a client, I was astounded at the language and our lives digitally, and how this has an impact on our
animated way shoppers spoke about their pets. Some real-world expectations.
pets had their own special couch, one dog even had his
Here is a very simple example. The average waiting
own TV!
time for an Uber or Lyft is 4 minutes. Anything more
When spending time with the consumer interview and a modern consumer is generally dissatisfied. That
transcripts and videos, I decided to focus on this aspect is a digital behaviour but now carried into the real
of ‘attachment’ in further interviews. Very quickly, the world – ask any shopper to queue at a bank teller or
emotive ‘button’ emerged that could be utilised in-aisle, cashier for over four minutes and you will have the same
and that was guilt. dissatisfaction. Digital has brought us all an I WANT IT
NOW attitude in most of our real-world interactions. We
No shopper wants to think of themselves of not being are a one-click, one-swipe consumer and we want that
a great owner, but yet the data showed that only 1 in efficiency in our real-world interactions too.
10 shoppers ever bought their cats an edible pet treat.
Dog treat statistics were higher, but not by that much. What does that mean for FMCG retail and shopper
Why were these owners claiming they loved their pets marketing? This isn’t about digitising FMCG retail (even
so much, but then just buying the basic pet food (cans though of course that is critical). This is about behaviours.
and kibble) from the shelves, leaving the higher margin
Digital places the shopper at the centre. The Uber car
treats on the shelf. It made little sense. What they
comes to you. Amazon remembers what you bought
needed was a nudge.

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Shopper Marketing

last time and recommends similar items. Just Eat changing nature of shoppers based on how they live
recommends restaurants near you. You, as the shopper, their digital lives. Today, shopper marketing campaigns
are at the centre and all the products and services and need to have strong digital elements to be relevant. The
solutions revolve around you. store is no longer the sole battle ground.

Now compare that to your average supermarket So, four of the social sciences and how they could be
where the aisles are laid out as a mirror-image of the applied to FMCG retail.
warehouse. What we ask of a shopper is to enter this
We need to remember that range management output
space with the need to feed themselves and their family
or a planogram is not the end, it is simply the beginning.
for the next 3-4 days. They are to take a basket and
These are the foundations onto which decent Shopper
cart, and while holding 4 meal solutions for every day
Marketing campaigns are built. But it is in investing
(breakfast, lunch, dinner, snacking) in their head, we
in significant shopper understanding, insight and
make them walk up and down across fresh, frozen,
behavioural analysis that will give us access to the
chilled, ambient and non-food, all the while expecting
significant incremental sales we seek by category.
them to yo-yo in their mind back and forward to the
meals they will want to prepare. No wonder they Learn to invest in a better understanding of the
just buy the same things all the time. FMCG retail is social sciences and their role in Shopper Marketing.
fundamentally non-shopper centric in its design. It continues to frustrate me when leading shopper
marketing masterclasses or retailer/supplier consultancy
Meal subscription boxes delivered to home do the
sessions just how little is understood in FMCG retail of
opposite. The shopper logs on, chooses meals that look
the power of what has been outlined above.
tasty and attractive, and all the ingredients in the right
portions arrive to their door. Shopper centric. BOXED, Investing a little time and budget in understanding
one of the biggest delivery-to-home FMCG players in how to best leverage human and shopper behaviour
the US is changing the nature of buying. If BOXED will always pays significant dividend. It is time for Shopper
deliver all my pet food, shampoo, mineral water, toilet Marketing to get Freudian!
roll and beer every 2 weeks, and HELLO FRESH will
deliver my meals for the week, with new and inspiring Ken Hughes is now acknowledged as one of the world’s
recipes every week, remind me again why I’d go back leading keynote speakers on consumer, shopper,
into a supermarket to walk up and down aisles? and cyber-behaviour exploring the needs of the new
consumer and predicting the changes to come.
I am not talking about the death of the supermarket,
but I am talking about the need for us to adapt to the www.kenhughes.info

58 59
 CATEGORY MANAGEMENT
Yesterday, Today & Tomorrow

ECR COMMUNITY
REPORTS

60 61
 Total
TheStore
Social
Optimization
Science of
Shopper
- Next level of Category Marketing
Management

Total Store Optimization

– Next level of Category
Management
Birgit Schröder, Lead Shopper Experience,
GS1 Germany GmbH / ECR Germany

Consumers‘ world is changing faster and faster. Definition of “Total Store“ (by GS1
Shoppers‘ expectations change so fast that today’s Germany)
expectations can already be outdated by tomorrow. The
“Total Store“ means the holistic, cross-category
buying behavior has changed significantly over the last
optimization of a store from a category management
years. Whether in the supermarket, hypermarket, in the
and shopper marketing perspective. The aim is reaching
discount or drugstore: Asking the shopper - shopping
most of the potential of the stores and their target
has to be an experience.
shoppers. The focus here is both on winning additional
Product availability, convenience and efficiency are shoppers and, in particular, on permanent retention of
very important, but shoppers are also searching for a existing shoppers (loyalty).
pleasant shopping atmosphere. If the retailer doesn’t
In relation to the total store approach, the retailer’s
comply with this wish, competitors will win.
medium to long-term strategy is much more relevant
Furthermore in a growing omnichannel environment, the than the single category strategy. The real intention is to
channel boundaries are disappearing more and more, differentiate from the competitors.
resulting in additional competition. A (re) positioning
Total Store Approach – what is it?
of the individual retailers is therefore becoming
increasingly important. It will no longer suffice just If you want to retain your customers long-term and also
optimizing specific categories. On the one hand, the want to win new ones, you have to stand out from the
shopper perceives the Point of Sale as a whole – which competition. In order to (re)position yourself as retailer
is also reflected by the increasing expectations. On the and meet the increasing shopper demands, it will no
other hand Differentiation from the competition is only longer suffice to concentrate on the individual product
possible with a coherent overall picture of the store. As groups when optimizing the store.
a logical consequence retailers should also work with
In this approach the store is considered in total.
the big picture. The solution: Total Store Approach.
Optimization takes place holistically and across all
With a holistic view at its store a retailer will be able categories. In contrast to the single category approach,
to exploit the potential of its target customers in the all store relevant needs of the shopper are taken into
best way. As with category management, the total account – to reach a win-win-win-situation for shopper,
store concept will be effective when it is based on the retailer and manufacturer.
needs of the shopper. With the difference being that
To understand expectations and needs of the shopper
all categories have to work together, a little bit like an
concerning the total store, GS1 Germany and GfK SE
orchestra arranging a difficult composition.

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 Total Store Optimization
- Next level of Category Management

carried out a total store shopper study in 2019 in the connected to local public transport, easily accessible Learning across all sales channels: The more a store Shoppers more and more expect fresh products coming
German market. In the following you will find some key on foot or by bike? Here, in turn, the parking facilities meets the expectations of its shoppers, the more this from their own region - not only in supermarkets and
results of this inquiry. are important for the shopper - there should be enough has a positive impact on its store image. And this has an hypermarkets, but also in the discount channel. After
parking spaces and bike racks. The closer environment even more significant effect on potential shoppers. finishing the purchase in a store, the willingness to visit
10 DIMENSIONS OF TOTAL STORE of the store is also crucial. If the shopper can link their another store decreases significantly. The solution for
APPROACH purchase directly to other things to do, for example in the retailer therefore could be: a wide range of products
the pharmacy, bakery or a parcel station, this has a
3. Store Choice and few options within one category, instead of a few
Beginning with the location of the store up to the
positive impact on their satisfaction. Why does a shopper choose a store or not? In addition categories with many product alternatives. Width rather
checkout zone, retailers and manufacturers need to
to basic requirements and the store image, other than depth is the order of the day.
determine the needs of their shoppers using the ten total
criteria provide information about the choice of store
store dimensions. While the individual components of
for shoppers. There is a strong desire for a seamless
the approach are already probably known, they merge in
link between online and offline shopping. In the FMCG
the total store optimization taking into account the entire
categories, digital natives in particular expect an
store and are used as parts of an overall process.
extension into the digital shopping world - for example:

1. Store Location ∂ Order online with delivery service or pick-up in the

stationary store
How large are the existing purchasing power,
socio-demographic structure and potential? The ∂ Online solutions for only part of the purchase or the
purchasing power and socio-demographic structure entire purchase
in the catchment area of the store play a key role ∂ A comprehensive online shop and delivery service that
in determining which shopper needs retailers and can access assortments from various retailers.
manufacturers have to satisfy and how big the potential
of the store optimisation can be. In addition to this, the While among the younger shoppers there is a high
following four key aspects determine which store a level of openness to the partial digital outsourcing of
shopper will visit. purchases, the older target group behaves cautiously.
For them, online offers are only considered in
In order to be able to do the shopping “on the way to emergency situations such as illness or for particularly
work or afterwards”, the proximity to your home or place
2. Store Image heavy, bulky purchases.
of work plays an important role. Based on this, the
location of the store and the accessibility: Is the store How is the store perceived - also in contrast to the
competition? Basically, shoppers‘ expectations when 4. Products & Assortment
buying products for everyday needs are the same
across all kind of shops: relevance and availability of the
Which ranges and products should be listed? The right 5. Shopper Flow
offer and range also have a decisive influence on the
assortment as well as a pleasant shopping atmosphere. Where are the hot spots or cold spots in the store?
satisfaction of the shopper. Particularly relevant factors
However, depending on the sales channel, the shopper Guideway of the customer - another aspect that
are selection, transparency regarding ingredients,
expects their requirements to be met in a different influences the shopping experience and which varies
origin etc. and personalization of the product range. In
extent. In the supermarkets, for example, shoppers from sales channel to sales channel. Depending on
contrast, out-of-stocks, poor quality of fresh products
expect an assortment that offers a wide range. In the type of purchase, shoppers prefer shorter or longer
and misleading information of ingredients lead to
relation to this, convenience products or especially fresh routes through the store. It turns out that guided routes
dissatisfaction.
products are very important. Additionally the availability are accepted as long as they offer shortcut options and
of products is essential. In contrast to the discounters, Sustainability is playing an increasingly important role in alternative routes. Flexibility is also very important here.
for the supermarkets it is expected that all items are the buying decision. In the meantime in Germany, many However, a precise assessment of relevant factors in
in stock throughout the day - also the fresh products shoppers expect plastic-free products and reusable relation to the shopper flow must be carried out on a
like fruit and vegetables. The atmosphere also plays a packaging. Retailers can score points from the shopper store-specific basis, since these depend mainly on the
major role. More than in any other shopping channel, when they deal right with expired food. The motto is not individual circumstances on site. For example, where hot
shoppers want an atmosphere in the supermarket that disposing of prematurely. spots and cold spots are located - in other words, more
invites them to browse and linger - and makes shopping frequented and less frequented areas in the store. Also
In addition to the classic categories, it is important to
a pleasure. Another point that contributes to the store other peculiarities of each individual store can influence
find out which additional assortment is able to attract
image is the staff: shoppers expect enough personell the evaluation of the shopper flow and subsequently
the shopper – e.g regional ranges or “to go“ products.
who care for their needs and wishes. placement recommendations.

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 Total Store Optimization
- Next level of Category Management

6. Category Adjacencies anchor brands offer good orientation – this means SUMMARY
brands or products that symbolize an entire category.
What are optimal category connections and what is the The total store process with its ten dimensions forms
cross-selling potential about? Along with the optimal Shoppers want prominently placed promotions and new the basis for successful, holistic store optimization and
placement in the market, it is important to determine products. Ideally, these are placed in the regular shelf at the same time structures the numerous activities
useful category adjacencies. Goal is making orientation and also placed secondary in the form of a campaign that should be conceived and implemented as part of
in store easier for shopper. Therefore as part of the placement or a “novelty shelf”. On the other hand, such an optimization. It should be noted that there is no
category management process, the category roles shoppers don‘t like if too many goods are placed in too one single way and one solution: the total store should
must first be determined. Once these have been small a space, so that it becomes confusing. Shelves always be optimized for each single store (alternatively
determined, an optimal category sequence from the that appear overloaded do not offer the shopper a clear for each market type) one the basis of the available data
shopper’s point of view should be combined with a good structure or intuitive navigation and should therefore be and insights as well as the desired retailer image. As in
circulation in the store from a retailer’s perspective - a avoided. category management, the shopper should be the focus
true masterpiece. Shopper insights and the analysis of all considerations, decisions and implementations.
of market and shopper data help retailers and
manufacturers to place categories where the shopper 8. Store Design A holistic store optimization can only be planned and
implemented in a complex and resource-intensive
expects them to perceive the market as “well structured” What is the optimal store design? The optimal store
manner. The retailer and target group strategy must be
and “clear”. design should on the one hand create the best possible
Click & Collect also plays an increasingly important taken into account.
orientation for the shopper and on the other hand an
role in the perception of the service offer: This enables
emotional shopping experience. For example, spacious
the shopper to send their shopping list digitally and to
areas create a real feel-good atmosphere. From different
receive the fully packed shopping cart in the market.
shelf heights to the use of subtle music and visual
orientation aids, the possibilities are almost unlimited. When it comes to personnel, shoppers want staff
who can answer especially questions about products.
The different ideas contribute to the different basic
This is expected above all in supermarkets and in
needs of shoppers. Orientation aids, for example,
hypermarkets. In the drugstore, employees should be
deposit on (time) efficiency and convenience, as well
able to provide information about the compatibility of
as trust and security. What triggers dissatisfaction, on
ingredients. Shoppers, on the other hand, rate rude,
the other hand, is an unloving shop design or poor
ignorant staff as very negative.
hygiene. This has a negative impact on the overall
quality perception of the total retailer’s offer. In general,
dirt and unpleasant smells cause discomfort. Neglected 10. Entrance-Zone
shelves and empty packaging are just as unpopular. In
What should be offered in the entrance zone? The first
the end, the overall impression counts. If this does not
and the last impression: the prepayment and post-
fit, shoppers are very likely to switch to the competition.
payment zone. They play a major role for shoppers in
larger supermarkets and hypermarkets in particular. In
9. Service & Staff the case of smaller stores, neighbouring shops like e.g.
drugmarkets are required to cover the daily needs of the
There are two key satisfaction factors regarding service.
shopper.
7. Placement Excessive waiting at the cash register triggers strong
At this point, a quote from Jeff Bezos, CEO of Amazon,
dissatisfaction. So there should always be enough open A quantitative check as part of the Total Store study has
What does a shopper-oriented placement of the fits very well and explains his success: “We see our
cash desks - especially at rush hour. In supermarkets shown, among other things, that in Germany a bakery in
categories look like? Retailers should structure and customers as invited guests to a party, and we are the
and drug stores, express or self-service checkouts are the entrance zone is a must-have for many shoppers. In
illuminate their shelves in the best possible way. hosts. It’s our job every day to make every important
an additional, time-saving option. addition to that, the relevance of other further offers such
The assortments and brands should be easy to aspect of the customer experience a little bit better. “
identify. Different product areas should also be clearly as butchers, pharmacy, tailors, lottery and magazine
In addition, shoppers want constant availability
differentiated from one another. In addition, clear kiosks or packing stations were queried. This is exactly the principle of the total store approach
regardless of the opening hours required by law.
signage provides orientation. Knowing that shoppers are and thus offers the retailer the opportunity to
Convenience stores in heavily frequented locations with The study shows different results depending on the
in the “autopilot” should not only rely on orientation aids successfully meet the ever increasing demands of
special opening times are therefore very popular. In sales channel. Stores that offer additional services in the
in the form of spoken and written text, but also on colors their shoppers. That way the retailer can develop the
larger stores gastronomic offers provide a plus in terms prepayment zone as well as in the immediate surrounding
and shapes. Images also enhance this effect. It can also preferred store and assert themselves as a long-term
of a feel-good factor. enable the shopper to make one-stop shopping and save
motionalise and trigger impulse purchases. In addition, successful player in a highly competitive market.
them tedious, time-consuming extra effort.

66 67
 Most efficient functionalities
The Social to
Science
improve
of
user experience on food
Shopper
E-retail
Marketing
website

Most efficient functionalities

to improve user experience
on food E-retail website
Francoise Acca

INTRODUCTION: THE NEED TO IMPROVE To do so, we addressed the following:

SHOPPER EXPERIENCE ON E-RETAILER
1) An overview of essential functionalities
WEBSITES
(conversion, shopping cart)
In the Shopper Mobile Survey carried out by Institut du
2) Common performance measurements
Commerce in 2018, we found that shoppers were still
(sales and digital KPIs)
disappointed with Click-and-Collect and Home delivery
websites. They compare their shopping experience 3) The Retailers and Suppliers operating modes
with that of other online and mobile apps and the
To do this, 25 retailers and manufacturers participated
results show a clear need for improvement. Specifically,
in a workshop preceded by inspiring presentations
regarding technical, compatibility and service rate
from L’Oréal, Accenture, Bol.com, Mano mano, Content
issues.
Square, Leclerc, Carrefour.
Aware of the improvements needed to enhance the
This is an extract version of our complete study that give
Shopper online experience, the Retail and Industrial
a summary overview of:
E-commerce teams wanted to launch a forward-
thinking workshop with the ambition to “Make the ∂ The must have functionalities for E-Retail?
online experience more fluid and more enriching”. The
final goal is to impact conversions and sales rates by
∂ The most impactful functionalities to facilitate client
experience and conversion
drawing inspiration from other sectors and Pure Players.
∂ Most common performance indicators and Sales
KPIs

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 Most efficient functionalities to improve
user experience on food E-retail website

PART I The most impactful functionalities to 1. Features to promote external traffic:

GENERATE TRAFFIC
WHAT ARE THE FUNCTIONALITIES ∂ “Where to Buy solutions” with providers such as
THAT ARE INDISPENSABLE TO We have classified the features according to the purpose Swaven or Click2buy. They allow to identify in real time
RETAIL? they serve and have distinguished 3 types of traffic. The on which e-merchant a product is available, and to
first is external traffic, which could only be of interest redirect the consumer to the website of his choice.
To develop sales, we use the Shopper equation as a
to Retailers or Companies that have developed Direct
starting point. On Click and Collect websites, Retailers
Fig 1 - Shopper equation to Consumer. These consist of flows of customers
∂ Media and audience extension campaigns.
and Suppliers need to work together to develop online
traffic and conversion.
The effectiveness of the actions carried out is measured
with shared KPIs, summarised in the following table.
that come from outside the Click and Collect /Home ∂ Co-funding of campaigns such as Google Shopping
delivery websites. Secondly, the internal traffic of the and Facebook Ads.
E-commerce website between the different departments
∂ SEO excellence: an enriched product information
and categories. Finally, we have mixed traffic inside
contributes to SEO optimization. Mobile sites must
AVERAGE and outside the website, like retargeting for instance.
BASKET be “SEO friendly” in order to generate more traffic as

=
mobile is gaining more and more weight.
SALES X TRAFFIC
∂ Co-construction of Content for Category and Themes
NUMBER OF
BASKETS = X to meet the growing expectations of the consumer,
which are broader than the product alone.
CONVERSION
2. Functionalities to promote internal traffic

The effectiveness of the actions carried out is measured KPIs. It is highly likely that this separation will no longer ∂ Optimization of internal SEO by passing information
with shared KPIs that we have summarised in the make sense in the long term since the indicators will from Retailers to Suppliers. For example, how to name
following table and where we have separated the online cover the entire purchasing process. categories, share the most searched keywords of each
(for sales on the drive and LAS sites) and offline (store) product, category entry keys, etc.

∂ In some instances, using high profile product visuals,

ONLINE OFFLINE such as a Category image, to develop a particular
category.
SALES E-COMMERCE TURNOVER STORE TURNOVER

AVERAGE
∂ Every on-site promotion that incentivizes the customer
BASKET
∂ Average price ∂ Average price to browse in other departments.
∂ Number of shopping items ∂ Number of shopping items
∂ Shopping item / service ∂ Shopping item 3. Features to promote mixed traffic and
∂ Special offer / activation guarantee traffic once the shopper is out of the
e-commerce website:
TRAFFIC
∂ Number of visitors ∂ Number of visitors in the store
∂ Number of website visitors ∂ Number of visitors in the category ∂ Retargeting campaigns such as Criteo Retargeting.
∂ Number visitors per category ∂ Number of buyers of the category The Supplier media teams should be involved in the
∂ Number of visitors who are looking development of such initiatives.
for the same type of product ∂ Special offers, such as Luckycart’s Promogaming,
CONVERSION
contribute to the rise in Retailer brand awareness, and
∂ Number of added items to the ∂ Number of buyers / number of visitors consequently generate more traffic.
basket/ Number of views SPECIAL of the category
OFFER/ACTIVATION ∂ Post-purchase triggers, using ways to build customer
∂ Number of added items to the basket loyalty once the purchase process is complete (e.g.
/ Number of visitors on the website e-mailing). Could the responsibility of customer loyalty
(visitors of the category + regular be shared between Retailers and Suppliers?
buyers of the category + browsers
via the search function)

NB: It is highly likely that this separation between online and offline will no longer make sense in the
long term since the indicators will cover the entire purchasing process.

70 71
 Most efficient functionalities to improve
user experience on food E-retail website

The most impactful functionalities to 2. The Cross Sell / Up Sell: PART II 5. Post-purchase experience
IMPROVE CONVERSION (trigger
conversion and increase purchasing
∂ Product information inspired from non-food practices, THE MOST IMPACTFUL ∂ CRM activation
basket size)
for example, integration of different fragrances into a FUNCTIONALITIES TO FACILITATE ∂ Chatbot
range of products.. CLIENT EXPERIENCE AND
There are 3 types of features to promote conversion: CONVERSION ∂ Consumer Ratings and Reviews
3. Product information: content, characteristics
customization, cross/upsell, and product information.
and composition of products 1. Quick product discovery
∂ Provide enriched content via newsletters
1. The customization of product
∂ Make sure that the GS1, Alkemics, Equadis etc... ∂ Passing data updates from e-retailers to Suppliers
recommendations to increase the speed of 2. Ease of shopping list design (e.g. keyword search peak)
streams are properly fed.
purchase: 3. Fast and efficient payment and logistics
∂ Check the completeness of the essential product
∂ List of frequent online and offline purchases information on the product sheets (composition,
service

∂ More structured promotions allergens, labels, product score, etc.). 4. Order satisfaction (freshness, packaging,...)
∂ Suggestion of alternatives in case of non-pursued ∂ Reliable information on measurement units (essential 5. Post-purchase experience
purchase for recipes)

∂ Collaboration on product rankings, alternative ∂ Fill missing content and upload high resolution images What are the possible actions on items 1, 2 and 5?
proposals, inspiration (menu idea / recipe planning), (including multi-sided packaging).
1. Quick product discovery
enriched content, Shop in Shop. .
∂ Offering features for the management of family needs ∂ Search performance +++
(customization of family preferences, health menu, ∂ Product Attributes that match with e-retailers Category
Organic, x2, x4, recipe suggestion...) Attributes, filters

∂ Work according to seasonality (e.g. Christmas,

holidays) by adding tags

∂ Consumer reviews and ratings (according to

categories)

∂ Cross-selling on product pages

∂ Useful content on the product pages (to be tested with
A/B testing)

∂ Video insertion, tutorials, in some cases at the

beginning of the category

∂ Highlight the “Product Pros” in the product visuals

2. Ease of shopping list design

∂ Customization of the experience

∂ Efficient search, work on the product referential:
keywords, ....

∂ A/B testing - quick wins

∂ Relevant filters - Quick filters (organic, by need, …)
∂ Enhance commercial events (beauty, Christmas for
example)

∂ Create standard baskets according to offline and

online purchase history (real-time behavioral analysis)

72 73
 Most efficient functionalities to improve
user experience on food E-retail website

PART III Retailers and Suppliers. Here are some indicators of TO SUMMARISE, HERE ARE THE
MOST COMMON PERFORMANCE
customer behavior monitored online: ESSENTIAL KPIs
INDICATORS AND SALES KPIs ∂ Number of customers
Three levels of E-commerce data that can potentially be ∂ Customer loyalty to the brand Performance KPIs Client behaviour KPIs Distribution KPIs
shared between Retailers and Suppliers.
∂ Cart Abandonment rate Sales value VIEW Numerical Distribution rate
∂ Bounce rate
1. Classic performance KPIs ∂ Customer qualification: new/existing, loyal/ Performance KPIs ∂ Traffic data (from category page to
This corresponds to all factual sales information for a opportunistic, etc. Consumer product page) Breakage rate
Sales
Unitvalue
given brand and the category to which it belongs. It
3. Impact analysis
Sales ∂ Search rank / Category rank
puts a brand’s performance in perspective to its market. RECRUITMENT
The following is a non-exhaustive list of the main For projects carried out by Retailers and Suppliers, for
∂ Recruitment %
performance indicators concerned: example the redesign of a Department navigation, it is
∂ N° of purchases / N° of total visits
essential to measure and share the actions carried out
The following is a non-exhaustive list of the main ∂ Conversion rate = page categories,
using the following indicators: products, banners...
performance indicators concerned:
∂ Before/after diagnosis ∂ Number of clicks vs. number of
∂ Turnover value and volume, products purchased
∂ Impacted turnover ∂ Add to cart rates based on one-time
∂ Evolution of turnover activations
∂ Uplift of sales
∂ Brand penetration rate in Customer Orders SATISFACTION
∂ Impact on the category ∂ NPS on a category or a product /
∂ Number of products purchased per customer
∂ Financing cost brand
2. Customer behaviour KPIs ∂ Customer Ratings and Reviews
∂ ROI ∂ Loading time
To enhance the online customer’s purchase journey, it
is necessary to know the customer. For this purpose,
performance indicators measuring customer behavior
constitutes a second level of data sharing between

STEERING COMMITTEE
Jean-Philippe MARAZZANI (LECLERC), Audrey AIMON (CARREFOUR),
Jérôme MARY (PEPSICO), Aurélie CHUPIN (HEINEKEN), Maud FERRY (DANONE),
Elena MEYER (EDGEWELL), Rozenn HERON (L’OREAL) Augustin de VILLARTAY (BACARDI),
Francoise ACCA (INSTITUT DU COMMERCE)

The Participants: Jean-Philippe MARAZZANI (Leclerc), Audrey AIMON (CARREFOUR),

Jérôme MARY (PEPSICO), Aurélie CHUPIN (HEINEKEN), Maud FERRY (DANONE),
Elena MEYER (EDGEWELL), Rozenn HERON (L’OREAL), Augustin de VILLARTAY (BACARDI),
Laurence DELAFON (FERRERO), Viviane COLOTTE (LABEYRIE), Arthur DELEVAL (MOET
HENNESSY DIAGEO), Margaux LISA FOLLET (NESTLE), Margaux VALOGNE (OSF),
Arthur GIBELIN (KELLOGGS), Solène LE BELLEC (J&J), Pascale DANGOISE (MC CORMICK),
Sylvie FERNANDEZ (SAVENCIA), Lancelot DUQUESNOY (HEINEKEN), Anaid CASI (MARS),
Violaine ALANO (GOUTERS MAGIQUES), Maxime DIEULLE (PEPSICO), Sandrine GUILLERME
(EDGEWELL PERSONAL CARE), Victor PEYRAT (DANONE), Marie POUSSIER (PANZANI),
Nadia SALAH (LACTALIS), Magalie RIBET (INTERMARCHE), Roxane GAILLARD (L’OREAL)

The Speakers: Catherine Ferder, Market intelligence manager for L’Oréal, Justine Lassieur,
Marketing Growth Manager Skincare chez L’Oréal, Thomas Pinthe, Achile Valaut altima° part of
Accenture Interactive, Amour Buidine, Head of Business Development France Mano Mano,
Vis Meno, IT Director E-commerce/Marketplace. Digital leader BOL.com, Jean-Philippe
Marazzani, Customer relations and Internet Director Leclerc, Audrey Aimon, Directrice
développement des ventes E-commerce Carrefour, Frédéric Kingue Johnson, VP Sales Western
Europe Content Square

Organisation and Management: Francoise ACCA, [email protected]

74 75
 Omnichannel Category Management: Moving from product
categories to shopper needs & wants categories

Omnichannel Category
Companies need to support and inspire their core
clients from the start of their shopping journey. Different
∂ Initiatives Development: The objectives, levers impact
and main marketing tactics are designed for each
journey paths of clients must be understood step of these categories of clients trying to offer more

Management: Moving from

by step: reach, acquisition, conversion, retention personalised answers to their needs.
and loyalty. Offline and online touchpoints must be
mapped to build the right personalised answer for each ∂ Implementation: The «Quick Winner» approach could
be successful: Fast Implementation of the innovative

product categories to shopper

consumer (Figure 1).
ideas on online channels, to reach quick insights and
The Category Management process in an omnichannel then, once their success has been verified, roll out the
environment is focused on 3 key steps: Shopper Insight, initiatives in the physical stores. The measurement

needs & wants categories Initiatives Development, Implementation.

∂ Shopper Insight: This focuses on the full shopping

system (KPIs) covers online together with physical
markets. The only limit to innovation implementation
in an omnichannel environment should be the IT
journey (from pre-sales to post-sales) and moves from
Antonella Altavilla and Silvia Scalia GS1 Italy product to service coherently with key principles of
Category Management. It must identify the categories
barriers!

of clients and needs.

Omnichannel retailing awareness is high for Italian have identified Category Management, in an adapted
FMCG’s shoppers as more Italian shoppers want to and simplified form, as the approach that first allows
switch from one channel to another seamlessly. The them to analyse and understand the needs and then to
pandemic has accelerated companies’ omnichannel respond to omnichannel shopper requests.
focus: the offering grew 5 times vs the demand
Companies must approach “Omnichannel” Category
growth of 20 times.
Management in a new way to be successful in
The key choice for companies is to define a coherent answering omnichannel consumer needs. The new
and recognizable positioning in all its served channels. framework changes, not in terms of principles or
Speed, consistency, personalization, interactivity, social objectives but in terms of focus: we no longer speak
media and experience are keywords to describe the of product categories, but of shopper needs & wants
evolutionary path that is required for them to manage categories.
these channels in an integrated way and to ensure
The concept of product becomes a complete ecosystem
economic sustainability in the medium to long term.
l:
nt Omnichanne
that includes complementary services too. The focus
ry Manageme
Even in the omnichannel context, a group of senior on categories of clients enlarges the scope of Category Catego rie di clienti e bi
sogni
go
managers from 18 leading ECR associated companies Management to the full shopping journey. prodotti a cate
Da categorie di

Figure 1: Framework of the Omnichannel Category Management

76 77
 Omnichannel Category Management: Moving from product
categories to shopper needs & wants categories

SHOPPER INSIGHT The chosen path of the core shopper target becomes Supported by the new technologies, i.e. artificial versus its competitors by monitoring these KPI. They
Each shopper’s target behaviour is analysed to build the key in defining the product categories. They will no intelligence, management can grow its own predictive permit to identify any problems in the relationship with
dynamic of the category path, merging different sources longer be hierarchically organized, but coherent to the capacity, 75% of the information needed to approach core clients and provide solutions very quickly.
of data (Figure 2). The key questions to be answered choosing criteria adopted by the shoppers. The same the clients come from their behaviours in the different
The focus of Category Management Omnichannel
are: product could be included in different categories, due to channels directly.
should be the Customer Lifetime Value, namely growing
different research path of the shoppers.
1. Who are my priority shopper targets: profiles, The most important KPI are those that monitor the the customer base value focusing on the medium term
needs, objectives, sensations, expectations...? Starting from the category tree defined for the offline quality of the relationship and engagement with objective of loyalty building, rather than working with
business, the analysis of the keywords researched by shoppers. In the omnichannel environment, the only the short term focus of attracting a number of
1. What are their shopping journeys? How many are shoppers online on companies’ website and on search company could achieve a distinctive success factor “cherry picker” clients with promotions (Figure 4).
they? How long do they take? engines, weighted through the click analysis highlights
1. Which touchpoints do they interact with? Are they all the shoppers preferred segmentation of the category.
satisfied or not? What are the critical points? Figure 3: KPIs for each phase of the shopper journey
The result is the category structure omnichannel: a
1. What do my priority shopper targets consider a hybrid of the category decision tree between offline and
“perfect experience”? How do we offer them a online. To identify the keywords and choosing criteria
“perfect experience” for each step of their journey? there are important synergies that manufacturers and
retailers can achieve. The objective of the analysis is to
The analysis, both qualitative and quantitative, should
shift the focus from what and how to sell to how to serve
cover the following areas:
better the core target clients having acquired a deep
∂ Profiling and mapping behaviours knowledge of their expectations.

∂ Understanding key steps of the journey and the The focus on the full shopper journey highlights the
specific behaviours and expectations per each step need for defining a new set of KPIs based on the
cross analysis of multiple sources cross-channel data:
∂ Measuring the current performance in terms of share
of wallet covered and potential on the full shopping companies’ databases, sell out data, CRM and loyalty
basket (benchmark) or for specific markets and data, ecommerce data, web and social analytics, etc
categories of products. (Figure 3).

Figure 2: Key elements of the Shopper insight

Figure 4: Customer Lifetime Value focus

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 Omnichannel Category Management: Moving from product
categories to shopper needs & wants categories

INITIATIVES DEVELOPMENT The key decisions to develop the right omnichannel Figure 6: Retail mix management in the omnichannel framework

The development of the initiatives should be managed assortment are:

as a continuous process that follows the evolution of 1. What are the core products that must be present in
shoppers’ needs and new technologies. Starting from both channels’ assortment?
the growth objectives, defined after the shopper insight,
the selection of the initiatives must be driven by the 2. What are the key criteria to assign exclusive SKUs
strategies and declined per lever (Figure 5). to one channel?

The result should be a range of products that satisfy

Focusing on retail mix levers the approach to
shoppers’ needs in any channel and for any shopping
omnichannel should be coherently defined among
occasion, continuously updated to follow demand
the different channels. Only differences in shoppers’
evolution and independent of operational constraints (for
target needs or their different behaviours could justify
example supply chain model based on in-store picking if
misalignments among channels (figures 6).
the store is small). Researchers have highlighted that if
A unique successful model does not exist for all the range is built coherently to the core shopper targets’
companies. To maximize integration of traffic flows choosing criteria the range variety is perceived to be
among channels, every company must find its own best higher and more satisfactory.
solution coherently with:
The key questions to develop the right omnichannel
∂ the banner positioning (experience led vs. product led pricing are:
vs. price led vs. convenience led)
1. What are the most important shopping missions by
∂ the role of category by channel (defined using a channel?
shopper centric cross channel approach) Research has highlighted that shoppers’ expectation developed for specific tactical objectives like:
2. What are the value drivers per channel?
is that the pricing be aligned among the channels. The
∂ the expectations of core targets by channel 3. Is the lowest price in the market the best policy? ∂ attracting new targets through personalised
discrimination could be acceptable when there is not a
The management levers in an omnichannel contest What are the advantages/disadvantages? campaigns
territorial overlapping between offline and online, or in
are more interdependent than in an offline contest,
due to the ongoing need to maintain [in the meantime]
a. of pricing alignment among channels? cases where the banner is managing the same different ∂ reducing online bounce rate through basket discounts
price areas both online and offline. A more successful
alignment among the channels policies and answer the b. of pricing discrimination by channel? policy of pricing discrimination could be the one based
∂ growing the average purchase value through
specificities of each one. thresholds discounts
c. of pricing discrimination by channel and by on a dynamic pricing approach, that considers a set
shopper target? of significant defined variables processing a huge ∂ promoting exclusive channel products through
amount of data coming from many sources using new BOGOF or bundle pack promotions
technologies such as artificial intelligence.
∂ evaluating innovative promotion mechanics in one
Figure 5: Strategies and coherent levers to grow The merchandising of the offline store influences channel before rolling them out
the visibility or placement in the online store. In an ∂ intercepting showrooming or reverse showrooming.
omnichannel context the retailer should develop
In the omnichannel category management approach
integrated solutions, even if they are customized per
Communication becomes an integral part of the
channel, to guarantee:
category plan for:
∂ unique experience moving from a channel to another ∂ attracting new clients belonging to the core targets
∂ minimization of cognitive effort for each shopper identified
journey phase.
∂ entertaining, socialising, interacting and engaging with
Due to the trend in grocery market that shoppers shoppers and leads
prefer to buy in the online shop from their preferred
offline retailer (if there is the possibility and the quality ∂ showing, informing, and telling the story of the
products and categories
of the service offered is satisfactory!) the promotional
policies should be aligned and integrated omnichannel ∂ building awareness, reputation, trust and loyalty to
(through digital technologies), to avoid cross-channel brands and banners.
cannibalization. Exclusive campaigns could be

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 Omnichannel Category Management: Moving from product
categories to shopper needs & wants categories

There are two types of communication to be integrated Market research has highlighted that: shopper Another key driver of the implementation of Category In the omnichannel environment there is a third party to
in the plan. The first one boosts the promotion initiatives, expectations and the perceived importance of the Management Omnichannel is the collaborative approach collaborate with: the shopper!
using leaflets and proximity marketing as touchpoints. management of the companies are not always aligned between Manufacturers and Retailers. Opportunities for
Shoppers want to be involved, want to interact, and want
The second one, content communication, builds the and that the perception of the added value of a service companies cover all the shopper journey (Figure 8).
to be heard.
storytelling of the values and the distinctiveness of the is quite different from one shopper to another. The key
The main areas are:
brands and banners. Through content communication success factors are clear communication and efficient For retailers, suppliers, and shoppers along the
the companies have to reach the heart and the implementation of services both online and offline. 1. Exploiting synergies of skills and knowing how to shopping journey there are 5 key buzzwords that build
head of their key shopper targets, adopting the right grow expertise in both engaging shoppers and the relationship: reputation (reach phase), credibility
language for each physical and digital touchpoint, and measuring their reactions. (acquisition phase), relevance and follow up (conversion
choosing the most effective mix for each phase of the
IMPLEMENTATION
phase), reciprocity (retention phase), respect and
shopper journey. Another key element for both types of The mantra of the companies developing omnichannel 2. Collaborating to improve retention and loyalty of
acknowledgement (loyalty phase).
communication is to grow the level of personalization, initiatives should be creativity, differentiation core targets leveraging both brand and banner
because that is what omnichannel shoppers ask for. personalization, instead, the mantra of implementation loyalty.
should be “quick winning”, test rapidly new ideas and 3. Using new technologies to assess and evaluate the
A very strategic role in an omnichannel context is the solutions and roll them out leveraging the approach of new way of interacting with shoppers.
Services lever. This is because the key objective of test and learn.
the omnichannel approach is not only selling products
but gaining the loyalty of the shoppers! This can be an Category Management Omnichannel requests
Figure 8: Areas of collaboration between retailers and manufacturers through the shopper journey
extraordinarily strong tool to push the drive from offline an evolution path on these aspects: master data
stores vs drive to online stores. There are two main management and e-content, supply chain process,
areas for developing distinctive services: organization, skills, and culture (enabling factors).
GS1 Italy has developed tools to support associated
∂ Interface and information exchange tools and companies to identify, to manage and to exchange
processes reliable data and contents in the omnichannel
∂ Shopper journey, payment, delivery and returns environment (Figure 7).
policies

Figure 7: Enabling factors and supporting tools developed from GS1 Italy

Special thanks for their contribution to:

Retailers: Auchan Italia, Carrefour, Coop, Conad, D.it, Despar, Esselunga, Selex
Manufacturers: Barilla, Carlsberg, Cameo, Danone, Ferrero, Heineken, Lavazza,
Mondelez, Nestlè, SC Johnson, Sutter
Others: IRI, Nielsen, Osservatori Digital Innovation MIP
Group facilitators: Antonella Altavilla, owner ADF Consulting and GS1 Italy Academy
consultant for Category Management and Silvia Scalia ECR Italy and Training Director GS1 Italy

For in depth analysis and insight please look at eBook “Category Management Omnichannel: da
categorie di prodotti a categorie di clienti e bisogni”, edited by GS1 Italy (QRcode as follows).

82 83
 CATEGORY MANAGEMENT
Yesterday, Today & Tomorrow

CURRENT PRACTICES
IN CATEGORY
MANAGEMENT

84 85
 Introduction to
Case Studies

Introduction to
capabilities to bring scale in their differentiating offer on As described in the Category Management – Yesterday,
the one hand (with private labels, retail brands, loyalty Today and Tomorrow paper, we believe that the next
card insights and promotions etc.), and on the other phase in the evolution of Category Management will
hand trying to be more relevant and able to implement be guided by developments in the five areas which are

Current Practices in their offer at the local level, given geo-marketing insights
on which customers live around each store and match
with the retailer’s differentiation strategy, what drives
listed below. Each of the case studies presented in the
report demonstrate the application of one or more of
these drivers.

Category Management
their shopping missions, and what assortment, pricing,
and promotions work best. This has been a core focus ∂ Redefinition of categories to reflect new
consumption habits, lifestyles and expectations.
of retailer Category Management work.
Examples are –
Collaboration to make both retailer and manufacturer • Infant Nutrition (Brazil)
efforts effective is the foundation of success in this 360° • Pasta Meals (Italy)
consumer-shopper journey experience. The Consumer- • Non-Alcoholic Beer (Ireland)
An important part of this ECR Report is the When looking at these different elements we have Shopper Journey business framework connects these • Rice (Greece)
inclusion of a number of case studies. These highlighted the role of Category Management in each efforts based on its insight model, and connects the • Provenance Information (France)
represent examples of how Category Management step of the consumer-shopper journey. work through the shared understanding of how the
is currently being used in a number of different
Manufacturers, from their core competency, put
retailer and the manufacturer can make the expectation ∂ Integration of Category Management into the
countries around the world. They also begin to come true for “who comes for which shopping mission” broader Consumer and Shopper Journey
focus on winning with their brand initiatives, through
demonstrate some of the key directions that to the retailer. This is the core of Category Management construct
generating awareness, consideration and trial. Their
Category Management is likely to take in the next and the strategic shopper marketing framework in which • Lunch Meats (Ireland)
success in building brand equity has been based on
few years as it continues to evolve and provide a the retailer creates differentiation and where the role of • Ready to Drink Beverages (France)
using Category Management to integrate their brand
foundation for addressing important industry trends the category and the brand find their maximum value • OTC Pain Relief, Flu and Gastro (Brazil)
strategies into this 360° Consumer-Shopper Journey
and growth opportunities. contributions. • Health and Wellness (Ireland)
structure and then collaborating with retailers to improve
• Soft Beverages (Greece)
In our Category Management - Yesterday, Today the retailer’s category performance while at the same The cases included in this report are a natural reflection
and Tomorrow paper we highlighted a number of time to gain the right brand presence in this context. of these perspectives (the retailer and the manufacturer
new elements and innovations that are keeping and their collaborative efforts). The future directions ∂ Application of Category Management principles
Retailers, as a response to these manufacturer and processes in e-Commerce channels
Category Management as a core business method for Category Management that we identify in the paper
initiatives starting in the early days of Category • Pet Food (Greece)
for understanding and satisfying the consumer and will require this double optical view of the collaborative
Management, have focused on developing their • Yogurt and Dairy Desserts (France)
shopper. potential.
• Multi-Channel Customer Journey (US)
For retailers, who face complex insights by location, by
shopper-ID, by consumer-shopper segment along the ∂ More effective collaboration between retailers and
journey, technology and big data, more and more driven manufacturers
by AI analytical tools, will become the means to win the • Beer (Italy)
race versus competition. We see this in the retailer case • Soft Beverages (Germany)
studies of Rewe, Carrefour, MRPI Ireland and Albertson’s. • Dairy and Frozen Foods (Canada)
It connects category performance improvement and
customer insight in how Category Management can be
∂ Use of more comprehensive multi-source
implemented effectively at the local level. consumer and shopper data sets and analytics
For manufacturers, the focus is on category re-visioning • OTC Pain Relief, Flu and Gastro (Brazil)
and brand re-invention arising from new consumer value • Pasta Meals (Italy)
drivers, and how the consumer becomes a shopper • Dairy AI Application (US)
with particular shopping mission expectations. Category
Management then helps the retailer to translate this ∂ Expanded use of Category Management in
new category vision in the mission and shopper journey different channels (including DIY and Pharmacy)
and in new markets (such as China).
experience. A number of the case studies demonstrate
how manufacturers have used Category Management to • OTC Pharma (Brazil)
accomplish these joint objectives. • Fresh Fruit (China)

86 87
 Developing a Category Business PROJECT METHODOLOGY
Plan for the Yoghurt and Chilled
Briefly describe the project background/ The shopper issue can be illustrated with the
Desserts category for the penetration rate on the category (that is under its
challenge and the rationale that led the
E-commerce channel team to propose this project. potential) :
COMPANY BACKGROUND For physical stores:
At the beginning of our project in 2018, E-commerce
FMCG Penetration : 99,5%; Yoghurt and Chilled dairy
represents 76% of the Yoghurt and Chilled dairy dessert
Company Name: dessert penetration: 96% ’ Index vs FMCG : 96,5
category growth on the French market. It is a key growth
Lactalis Nestlé Ultra Frais lever for a category that underwent a chronic recession For Click and Mortar (French Drive): FMCG
for 10 years due to physical stores. Penetration: 28,3%; Yoghurt and Chilled dairy dessert
Product Name & Relevant Category:
penetration: 21,3% ’ Index vs FMCG : 75,4.
Yoghurt and Chilled dairy dessert (pudding, mousse, Nevertheless, E-commerce has a penetration rate under
Potential = 80 Million euros!
custard…) – within dairy category its potential. Moreover, 70% of the e-shoppers declares
that they don’t really understand the organization of the This penetration rate can be explained by 3 reasons :
Location of Marketplaces: Yoghurt and Chilled dairy dessert category on Click and
For the moment, the marketplace is France. Mortar websites. These 2 facts shows us that we are 1. E-shoppers restrain themselves to buy because they
far away from the full potential of the category. Based can’t see the expiry date on the product: 21% of
Store Format: on strong and relevant studies, our project, E-plaisir+ , the consumers don’t buy Yoghurts and Chilled dairy
E-commerce channel : Click and mortar (French Drive). deals with 2 main objectives : desserts on Click & Mortar Websites because they
are afraid to have a too «short » date (even more on
Annual Local Market Sales: 1. Make the on-line buying experience more fluent and large formats or on stocking promotions offers).
encourage sales by improving the understanding
€500M - €1 Billion 2. The offer is not large enough according to the
of the category. E-plaisir+ puts the shopper at the
Lactalis Nestlé Ultra Frais (LNUF) France Total turnover : heart of the on-line buying experience, by building consumers: 42% of them want more products on
515 Million euros the E-merchandising experience through HIS websites. 90% think that they should find the same
understanding of the category and using HIS words. quantity of products on-line than in the physical store
LNUF total turnover on « Click and Mortar » (French they are used to go in.
In the same time, we reduce the annoying elements
drive) sales : 38 Million euros
that push him to leave the category. 3. The organization of Yoghurt and Chilled dairy
Local Employee Numbers: desserts on line is most of the time misunderstood
2. Increase his shopping cart by developing the
250 employees exploration and by spotlighting driving subcategories because it is poorly executed: 70% of the
of the Yoghurt and Chilled dairy dessert category. e-shoppers declare that the organization of the
In your local market, how significant are you products within the category lacks of clarity. The
within your chosen category? Working with retailers permitted to validate the category is considered as complex, the taxonomy
Very Significant – LNUF Market Share on Click and consistency and the efficiency of the E-plaisir+ is misunderstood, the organization of the products
Mortar Sales : 13% (n°2) approach. within the different families of the category lacks of
logic. With more than 395 products within this huge
How advanced is Category Management within category, the organization is a key success factor!
your company?
Advanced. Moreover, in a context where shoppers are buying both
in physical stores and drive website, the physical store
Category Management is well advanced in our remains the reference for them (when they arrive on a
company. It is very important for us to understand the drive website they are looking for the same organization
trends of the dairy category and to give solutions/ an than in physical stores), the e-shopper don’t find his
understanding of these trends in order to implement benchmarks and habits. The E-plaisir+ approach
good solutions afterwards. It is the starting point of every
answers the 3rd element.
project we launch. Understanding the environment,
consumer attitudes, what they are looking for, must be
the first concern of any company in order to produce a
market
sustainable growth.

Number of people employed in Category List the retailers you worked with on this project?
Management team in your Company? Carrefour Drive France, Auchan Drive France were
Our company is composed of a category management our partners during the development of the project and
division with 10 employees. helped us to implement it first. Then, other retailers were
involved in our project called “Eplaisir+”: Courses U,
Intermarche Drive, ChronoDrive France, Cora Drive...

88 89
 PROJECT IMPLEMENTATION

Describe your target market for this What KPI’s (if any) were used to Describe the project framework and Briefly describe the key steps taken to
project. measure the project outcomes? what tools you used. complete the project.

4 main KPI’s were used to measure the project We used different tools for this project : Here are the key steps of the project :
In geographical terms, for the moment, our target is the
French market. The penetration rate of click and mortar outcomes : ∂ Internal Category management studies: we did a è E-shopper understanding: studies
websites (French Drive) is about 25%. large E-commerce diagnosis, based on data coming
For our clients - retailers implementing E-plaisir + on
from retailers panels and consumer panels
∂ Development of hero images, primordial according to
We want our E-plaisir+ approach to be implemented their websites : the E-shopper studies : beginning of 2018
in all the FMCG retailers’ websites to improve the Objective: putting into perspective the issues and
E-shopper experience on our category.
1. Sales : Increase of the on-line turnover
growth levers on “Drive market”
∂ Implementation of E-plaisir+ 1st version on retailers
2. Navigation : Decrease of the amount of products websites (1st trimester of 2018). Measures,
put in the basket using the search bar ∂ E-shopper studies: we launched an E-shopper studies. confrontation with technical issues, adaptation of the
List and give a brief overview of the Objective: understand the e-shopper reality
project according to the constraints.
For us
main objectives of this project. concerning the understanding of the shelf, the ∂ Search data analysis (2nd trimester of 2018). Search
3. Partnerships : Number of retailers implementing category, identify his expectations, the levers, approach added to the project.
This project has 2 main objectives : our E-plaisir+ approach the disincentives elements and what pushes him
1. Develop the penetration rate and the purchase 4. Sales : increase of our market share on on-line to leave the category. To achieve this task, we
∂ Confrontation between our E-plaisir+ approach
(coming from the E-shopper studies) and the retailer
conversion by making the buying experience more perimeter worked with qualitative and quantitative panels, 400
data: T3-T4 2018.
fluent and by improving the understanding of the regular E-shoppers and consumers of our category
category (representative of all the retailers). ∂ Validation and implementation of E-plaisir+ on the
website of our retailer partner : December 2018 for
2. Increase the shopping cart by developing the ∂ Studies and analyses of the key words used in the
the first step
exploration and by spotlighting driving elements of search bar for yoghurt and chilled dairy dessert
the Yoghurt and Chilled dairy dessert category. category, thanks to the collaboration with a search ∂ S1 2019 : measure of the results
and SEO specialist:
We addressed all the aspects of E-merchandising :
Objective: validate the key entries of the category,
∂ Taxonomy
understand the shopper wording in order to use it in
∂ Filters the taxonomy and in the spelling of the products to
Notamment car le e-shopper a besoin d’une
optimize the search performances. To complete this
∂ Hero images
task, we analyzed 2,6 M° researches/ 12 338 key
réponse plus adaptée à ses attentes

∂ Apparition order of products words used through the search bar to buy products
from our category.
∂ Search… Crainte de la DLC
trop courte
Offre jugée
insuffisante
E-merchandising
mal exécuté

∂ Shopper and e-shopper studies, thanks to: 21% des e-shoppers 42% des e-shoppers 70% des e-shoppers
intelligence Data, client & distribution specialist n’achètent pas d’UF en attendent déclarent que
Drive par crainte de plus d’offre UF -1,3% l’organisation du rayon
DLC trop courte UF en Drive manque de

Et il reste encore un fort potentiel inexploité Objective: Compare the insights received from the
E-shopper studies with the “reality” (data issued
Exacerbé sur les gros
formats et les mécaniques
90% estiment devoir
trouver en Drive le
même assortiment
clarté

La pénétration de l’UF en Drive est sous indicée vs PGC et produits laitiers

promo stockantes
qu’au magasin
from our retailer partner, from the loyalty cards 6

of 15 million French households, their receipts

Source
Source :: KANTAR
EtudesCAM
E-shopper
P7 2017 Segments pourKANTAR
UF HS COMPOTE LNUF décembre
CAM P7 20172017 base 384 répondants acheteurs d’UF réguliers du Drive
PGC+FLS

Enjeu recrutement and their navigation on the retailer’s website).

Execution: on the click & mortar website of our
% Pénétration % Pénétration % Pénétration retailer partner.
HMSM PGC+FLS HMSM Pdts Laitiers HMSM UF Un circuit est particulièrement prometteur
99,5 98,8 96 DRIVE
Indice 96 76% des gains Circuit de reconquête
de l’Ultra Frais en 2018 de la famille, cœur de cible en UF

% Pénétration % Pénétration % Pénétration 1er levier de croissance de

la catégorie
Drive PGC+FLS Drive Pdts Laitiers Drive UF
Potentiel : CA UF en drive
50% de la déconsommation

28,3 25,1 21,3 80 M°€

indice 111 vs PGC

circuit plus lourd pour la catégorie

54% des shoppers, 78% des dépenses
en Drive
que pour le global PGC

Indice 75 5
Source : IRI E-commerce CAM P13 2018 / KANTAR Total Distribution CAM P13 2017 / Kantar 2017
4

Source : Kantar WPO CAM 3T18

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 RESULTS

Describe the brand resources assigned Describe the retailer resources assigned What were the key quantitative results? What were the key qualitative results?
to the project. to the project. For our client retailer : Qualitative results : feedbacks of the retailers that
implemented Eplaisir + :
Multi-functional team had the responsibility to connect The retailer’s team was composed of experts in Two main quantitative KPI’s were used to measure the
the company’s strategy with the External partners. This E-merchandising : project outcomes. ∂ A realist and operational approach : quick
team comprised: implementation of Eplaisir + (less than 10 days)
2 E-merchandising Managers: Challenge
Turnover increase :
1 E-commerce Manager, 1 Category Management E-merchandising measures and assure the ∂ The retailer team enjoyed our collaboration. Here is
Director, 1 Market research Manager, 2 experts in implementation Index 168! The new website taxonomy is over his testimonial :
relation with retailers performing.
Omni Channels Sales Manager: challenge the « It as a pleasure to work in collaboration with the
E-commerce Manager: coordinate the whole project decisions and validate the measures Growth for all sub-categories and all manufacturers. Data Specialist and LNUF on our website taxonomy
for yoghurts and chilled dairy desserts: associating the
Category Management Director: ensure the On-line Dairy Products Manager: validate the
Good navigation impact : market knowledge of LNUF, the data knowledge of the
category vision all along the project consistency of the project thanks to his category vision
Data Specialist and our knowledge in E-merchandising
Market Research Manager: ensure the link with the better understanding of the category : was really instructive. Moreover, the quantitative results
study institutes and participate to the studies thanks to Global decrease of the part of articles put in the are incredible! »
his knowledge on Shopper studies shopping basket using the search bar
∂ E-plaisir + was recognized as it received 2 category
Experts in relation with retailers: ensure the More important decrease on sub-categories created in management rewards in 2019 : the LSA and SIRIUS
commercial link with retailers and partners the taxonomy by E-plaisir +. Ex: -17% on light yoghurts trophies
sub-category (didn’t exist before).
Our main key success factors were the following : ∂ Moreover, this project bring to LNUF a
complementary expertise and now, we are seen as a
∂ Synergy between our category expertise, our precise
For us : category captain by our clients/retailers.
knowledge of the e-shopper and our expertise in
E-commerce ∂ Partnerships : 7 retailers implemented E-plaisir+

∂ Our wish to place the e-shopper at the heart of our

∂ Sales: in 2019 we won 0,5pt of market share
approach while respecting the rules of physical stores
on e-commerce channel. We were 3rd on the
(it remains the reference for the e-shopper)
e-commerce market, we are now 2nd. E-plaisir+
∂ Our strong methodology at every steps of the project contributed to this performance.

It as a pleasure to work in
collaboration with the Data
E-plaisir+ puts the shopper Specialist and LNUF on
at the heart of the on- our website taxonomy for
line buying experience, by yoghurts and chilled dairy
building the E-merchandising desserts: associating the
experience through HIS market knowledge of LNUF,
understanding of the the data knowledge of the
category and using HIS words Data Specialist and our
knowledge in E-merchandising
was really instructive.

92 93
 Creating and implementing
KEY LEARNINGS a Destination Role Category
Business Plan to create a strategic
What were the major barriers faced What key advice would you offer to your
during the project? peers who are considering investing in
competitive advantage for the
Category Management? COMPANY BACKGROUND Fresh Fruit category in China
The major barriers were the following :
Our advices for people who are considering investing
∂ Keep people motivated during all the duration of the
category management are the following : This case study is submitted by:
project (the project lasted 1 year and a half)
Yong Jiang
∂ We had to start from scratch, anybody did that kind ∂ The category management must be based on solid
of project before (we were the first so 0 benchmark), studies, on solid shopper insights to be relevant Title:
and the Drive channel was quite unknown at that ∂ It is important to work in collaboration with partners, Deputy General Manager Rainbow Group
time (for example we had to face some unpredictable that have different areas of expertise
technical issues) Company Name:
∂ The “marketing part” of the project is essential : keep
Rainbow Department Store CO. LTD
∂ It was a challenge to mobilize enough budget at each people interested on the project, communicate on it
step of the project, we had to convince internally
∂ Identify the obstacles and capitalize on the strengths. Product Name & Relevant Category:

What would you do differently if starting ∂ Take the time to question the retailers, to understand Fresh Fruit Category with five major sub-categories
their vision and what they need, it is impossible to ∂ Family Essentials
the project again? develop a project alone, it as to be a collaboration. ∂ First Choice of Health In 2018, Rainbow started this work with its consultant
∂ Happy Buying Seasonal Fruit (Your Partner in Business - YPIB) by conducting a
If starting the project again, we would choose a studies Category Management orientation training program and
institute more “action-oriented”. Indeed, it was quite ∂ Must Buy, Weekly Promotion
completing a comprehensive Capability Assessment
difficult to translate the study’s results because it was ∂ Refrigerated, Cut and Ready to Use Fruits to evaluate the current capabilities for Category
really descriptive. Management within Rainbow. Managers in all of the
Location of Marketplaces: key departments and positions were interviewed.
Shenzhen, China and the Southern China region. Based on assessment, a detailed 3 to 5-year timeline
of Milestones and Action Steps was developed to guide
Store Format: the implementation of Category Management.
Rainbow operates Supermarket Sp@ce format (100
stores). To begin to create the foundation for Category
Management, Rainbow decided to undertake a major
Un impact business extrêmement positif Annual Local Market Sales: restructuring of the organization from a decentralized
store-driven organization to a centralized Category
èbénéfices pour notre Entreprise > €1 Billion
Management organization. This transition started in
2018 and is still ongoing. During this reorganization
How many employees work in the relevant
Category Management business methods have been
marketplace?
En 2019 Estimated 8,000
rolling out throughout Rainbow.

In 2019 the focus was on expanding the completion

Nouveau champ d’expertise How significant is your product within your and implementation of Category Business Plans
passe de la chosen product category? across all major product departments and developing
the capabilities within Rainbow to support Category
Vision merchandising désormais omnicanale 3e à la 2e place du marché Very Significant.
Management. By the end of 2019, approximately
notamment grâce à sa croissance The Fresh Fruit category is extremely significant to 2 years after starting to implement Category
exceptionnelle sur le E-commerce Rainbow and in the market. It represents 24% of Management, Rainbow is recognized as one of the
Approche inédite positionnante Rainbow’s total store sales. The Fresh Fruit category is leading Chinese retailers in the use of these methods.
• 1ère croissance du marché a Destination category in all Rainbow stores.
+9,9% Valeur (Croissance catégorie +6%) How many people work on the Category
Très bon accueil enseignes +8,2% Volume (Croissance catégorie +3,7%) How advanced is Category Management within Management team that delivered this project?
your company?
7 clients appliquent aujourd’hui tout ou partie Rainbow middle management – approximately 100
Gains en PDM val. et vol : +0,4 pt Advanced/Leadership level within China employees in total
de la démarche
Intermediate level within the World context
25
List the suppliers you worked with on this
Source : IRI E-commerce CAM P7 2019 In 2107, Rainbow’s senior management made project:
a commitment to start implementing Category Suppliers had minimal involvement due to current lack
Management Best Practices within their company. The of supplier capabilities in Category Management in
Fresh Fruit category was one of the initial categories Fresh product areas in China.
selected for application of Category Management.

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PROJECT METHODOLOGY PROJECT IMPLEMENTATION

Briefly describe the project background/ Describe the project framework and Briefly describe the key steps taken to
challenge and the rationale that led the what tools you used. complete the project
team to propose this project.
The 2018 Capability Assessment report provided The key steps in completing the work were:
Rainbow senior management determined that they the overall strategic direction for all the Category
needed to reposition the store and the Fresh Fruit Management work completed within Rainbow. It
∂ The Fresh Fruit Category Plan work team was
formed. It comprised representatives of head
category to better reflect the changing expectations and identified the Strengths, Weakness, Opportunities and
office Category Management, buying and support
demands of their target shopper. Their target shopper the Threats (SWOT’s) within the Rainbow organization
functions including data analysis, planogramming
had increasing income and an increasing demand for Describe your target market for this and developed the Timeline of Milestones and Actions
and pricing. Store Operations managers were also
better quality, more premium food products with higher project. Steps that would be followed to implement Category
assigned to the work team.
product safety protection. Management.

The challenge was compounded by the increasing

Rainbow’s target shopper is Middle to Upper Income
The key tools used to deliver the implementation plan
∂ A schedule of meeting dates and work assignments
Families that are focused on Health Consciousness, was established – this included meetings with and
competition from both the traditional “Brick” retailers and Quality and Food Safety. were:
without the consultant. An important element of the
the sophisticated “Click” online retailers. Additionally,
there was the rapid growth of the “Category Killer”
∂ The 8-Step Category Business Planning Process work was to complete the work of developing the
was used to complete all Rainbow Category Category Business Plan using a combination of
Fruit Store format that provided a convenient option for List and give a brief overview of the main
Business Plans across all product departments, classroom teaching and reviewing in the office (50%
Rainbow shoppers. objectives of this. including in all Fresh Departments. A key element of the total time) and “hands on, inside the store”
Rainbow management’s challenge was to implement The project had several objectives: of this process was the assignment of strategic implementation work sessions (50%) in front of the
a new work process that would deliver the following Category Roles for all categories. The Fresh Fresh Fruit category.
changes in the Fresh Fruit category and in their stores;
∂ Reverse a total company declining sales growth and
Fruit category was one the categories assigned a
achieve a significant reversal in Sales and Profit trends.
Destination Role.
∂ The workflow and meeting schedule were guided
1. Leverage the traffic of the high household by the 8-step Category Business Planning process.
penetration of the Fresh Fruit category to draw the
∂ Build and deliver Fresh Fruit as a Destination category
∂ The 6 Components of Category Management Each of the steps was completed and reviewed
inside Rainbow stores thereby creating a strategic
target shopper back into the Rainbow “Brick” store. provided the overall roadmap for developing before moving on to the next step.
competitive advantage (SCA) over competition, both
Rainbow’s organizational capabilities to support
2. Increase the transaction size of their existing large national and international retailers Step 1: Category Definition and Consumer Decision
Category Management, including capabilities at
Tree
shoppers ∂ Increase the market share of Fresh Fruit leveraging head office and store level.
3. Expand the high profitability of the Fresh Fruit its strong market growth and high gross margin Step 2: Category Role (Senior Management
∂ The Consumer Decision Tree (CDT) process was
category ∂ Capture and leverage high shopper loyalty using the key tool used to optimize category assortments.
identified Fresh Fruit as a key Destination category)

4. Create excitement for their target shopper to gain an Fresh Fruit as the traffic magnet to attract and Step 3: Assessment of Category Performance;
advantage over competitors. maintain the loyalty of Rainbow’s target shopper ∂ Competitive SWOT Analysis was used to ensure
completion of in-store Competitive SWOT Analysis
that each Category Plan developed reflected real
Implementing a best practices Category Management ∂ Rationalize the product assortment to remove
opportunities in the market and had the potential to Step 4: Scorecard
duplication not needed in the category
process and capability was chosen as the way to create differentiation for Rainbow. Step 5: Category Strategy
accomplish these objectives. The Fresh Fruit category ∂ Use a powerful package of innovation to differentiate
∂ The Store Operations Category Management
was selected as one of the first categories for the the category and create strategic competitive Step 6: Tactics - Assortment Optimization
training seminar provided the knowledge platform for
development of a Category Business Plan working with advantage over competition. Step 6: Tactics - Shelf Layout and Merchandising
the successful implementation of Category Business
its consultant, Your Partner in Business (YPIB).
Plans at the store level. (See photo below). Step 6: Tactics – Pricing and Promotion
What KPI’s (if any) were used to measure Step 7: Implementation, including Store Operations
the project outcomes? Category Management Implementation training
A balanced scorecard of KPI’s was used to measure the
results of the Fresh Fruit Category Business Plan. These
Key KPI’s were:
∂ Store Sales Penetration
∂ Transaction Size
∂ Sales Growth %
∂ Gross Profit %
∂ Service Levels by the Suppliers
∂ Service Level by the Distribution Center
∂ Service Level at Store Level
∂ Shrink Level

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 RESULTS

Describe the supplier resources that work teams and conducting periodic meetings to What were the key quantitative results? ∂ Training of the Rainbow staff in other categories as
review and coordinate work assignments in-between part of development of Fresh Fruit Category Plan
were assigned to the project. Significant increases in Fresh Fruit Category Sales and enabled Rainbow to more quickly drive incremental
meetings with the consultants.
Profit were achieved: sales and profits across additional categories
As mentioned preciously, at this time in China there
∂ A Senior Buyer - who were designated as the
are very few suppliers in the Fresh category areas that Category Manager led the Category Plan work First year of implementation of Fresh Fruit ∂ Training of Store Operation personnel allowed them
have the capabilities to engage fully in this Category team in the completion of each step of Fresh Category Plan: to understand why Category Business Plans are
Management process. The work team, however, did so important and effective for increasing sales and
conduct some informal conversations with several Fresh
Fruit Category Plan. (Note - The title of Category ∂ 2018 Sales +8.2% Gross Profit +1.2%
profit in their stores. This largely removed one of the
Manager had not yet been instituted within Rainbow
Fruit suppliers to get their perspectives and insights at the start of this project. Senior management Second year of implementation of Category Plan: major disconnects that retailers experience in the
on the category and on Rainbow’s opportunities in the implementation of Category Business Plans -- the
category.
decided to become familiar with the new work first ∂ 2019 Sales +28% Gross Profit +25%
lack of Category Management training for Store
before making any organizational title changes).
Operation personnel. YPIB conducted a 2-day Store
∂ Data Analyst – compile and analyse internal and What were the key qualitative results? Operations Category Management training seminar to
Describe the retailer resources that were any available external data for the category give Rainbow Store Managers the knowledge needed
assigned to the project.
∂ Fresh Fruit Category Buyer – manage ∂ Transformation of Fresh Fruit into a Destination to fully support the implementation of Category
procurement to support the Category Plan category. The most important changes that were Business Plans in their stores.
Overall guidance and project leadership – Deputy implemented to achieve this were:
General Manager Rainbow Group (Yong Jiang) and ∂ Store Operation Manager - implement the tactics ∂ Interviews with Rainbow target shoppers indicated a
General Manager Rainbow Supermarkets (Tao Wang). within the completed Category Plan ∂ Reducing the overall daily assortment from 150 positive impact on the perception and image of the
products to 75 products Fresh Fruit category and of the overall Rainbow store.
∂ Project Coordinator - an experienced mid-level ∂ Project Consulting facilitation and training –
manager whose key role was to be the key internal provided by the consultants (YPIB) ∂ Regrouping this reduced assortment into the 5 ∂ The parent company (Rainbow Group) has four
defined sub-categories. retail divisions, one of which is the Rainbow Foods
driver of the Timeline of Action Steps. This required
communicating with each of the Category Plan ∂ Repositioning the 5 sub-categories to highlight the division. In 2019, the Rainbow Foods division had
positive Sales and Profit results while the other three
desired Marketing Images to the target shopper
divisions had negative sales and profit numbers. The
∂ Repositioning the 5 sub-categories based on a logical Rainbow Foods CEO and staff attribute the superior
flow of the selected Category Strategies operating performance of their division to the impact
∂ Generating shopper excitement each time they from the implementation of Best Practices Category
entered into the Fresh Fruit category with this Management methods.
reduced assortment and increased visibility of the 5
repositioned subcategories.

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KEY LEARNINGS
Developing a Category Business Plan
What were the major barriers faced What would you do differently if starting to recover declining sales in the Beer
during the project? the project again? category in the hypermarket and
∂ Transitional resistance to any changes is always ∂ In reality, nothing. supermarket channels
expected. Having the strong support from senior
management, as is the case at Rainbow, is essential
∂ The April 2018 Capability Assessment report provided COMPANY BACKGROUND
a clear picture of the Strengths, Weaknesses,
and drives the success of the program.
Opportunities and the Threats facing the Rainbow
This case study is submitted by:
∂ Resistance to making assortment changes (deletion organization and the Timeline of Milestones and
and reduction of the number of products within the Actions Steps has provided the work plan to fully Barbara Ottonelli and Veronica Maggioni
category) is the biggest point of resistance to this leverage these through the Category Management
process and is the most important to overcome. implementation program. It worked perfectly. Company Name:
Birra Peroni srl - a subsidiary of Asahi Europe Ltd
∂ The Rainbow organization and their senior
management were hungry for this new thinking, What key advice would you offer to your Product Name & Relevant Category:
this new work process, and this new way of doing Beer category. We divide the category in 4 main
peers who are considering investing in
business. This is a significant reason for why the price segments: economy, mainstream, premium and
impressive improvements in results were achieved in Category Management?
superpremium. Economy has been consolidating a
the Fresh Fruit category. downward trend for 5 years, instead Mainstream and
∂ Do not wait for everything to be perfect and in place
Premium still represent over 60 % of total category value
∂ Earning credibility along the way through teaching to get started. The process is an evolutive one.
with a positive performance. Superpremium segment
and incorporating these new concepts into the day-to- Do not wait for more or better Fresh category data weights nearly 10% with an encouraging growth YoY.
day work of the retail organization has been a key to to become available. There is more than enough
the success of this project. information to get started even in a country like China Location of Marketplaces:
where data sources are quite limited. Location of marketplace is Italy. Recently we overcame
How advanced is Category Management within
∂ What is absolutely needed is a consistent 20 million of hectoliters of consumption. Italian
consumption per capita is 34 lt instead top 3 European your company?
commitment by senior management to support the
countries per capita is above 100 lt. In terms of volume, Advanced
work of Category Management.
beer is the third category in beverage macro-segment.
Advanced level in beer market. Intermediate level
Store Format: compare to companies competing in other beverage
segment (i.e. Coca Cola in soft drinks) and food
Hypermarket (>5500 sqm)
category (Barilla in pasta market). Birra Peroni has
Superstore (2500-5500 sqm) a demonstrated history in category management
undertaking several project with different retailers in the
Annual Local Market Sales: last years. Its main strength is an unbiased approach
> €1 Billion based on consumer trends and shopper behaviors
research continuously updated and conducted with big
Beer market registers constant growth YoY (+4% 4yrs partners such as IRI and IPSOS.
cagr).
How many people work on the Category
It’s the third category after water (first in volumes and Management team that delivered this project?
second in value) and wine (first in value and second in
volumes). Birra Peroni middle management based in Italy. The
core category team is composed by 5 people but each
How many employees work in the relevant project usually involved also consumer & shopper
marketplace? insight department (2 people), sales department (1
key account manager for customer engagement and
140,000 people with an increasing employment rate.
4-5 in-store key account on average for execution and
monitoring in pos).
In your local market, how significant are you
within your chosen category?
List the retailers you worked with on this project?
Extremely Significant
We are working with a local player and a national chain.
In HSS Italian channel, three players make 70% of The first one innovates on superstore by reviewing
the beer market. Birra Peroni is the follower with 16% layouts to boost impulse purchase. The second one
of value market share. In terms of volume, our main launched two new formats: one with an exclusive
brands Peroni and Nastro Azzurro are both in the top assortment to catch upper class and the other one for
ten brands ranking. shoppers more sensitive to promotions. All formats
focus on “big stock” shopping mission.

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PROJECT METHODOLOGY PROJECT IMPLEMENTATION

Briefly describe the project background/ List and give a brief overview of the Describe the project framework and Describe the brand resources assigned
challenge and the rationale that led the main objectives of this project. what tools you used. to the project.
team to propose this project.
We set same objectives for both project: We exploited the outcomes of an unbiased study on Insight team shared outcomes of shopper research with
We concentrated our project proposal mainly on ∂ to recover declining sales trend (total sales and no shopper behavior evolution giving an alternative to the customer trade marketing which reworked key findings
hypermarket and superstores formats because they are promo sales) of the category in hypermarkets format leader approach where brand is outwardly the main creating an effective selling story for shoppers.
both suffering the most in terms of sales performance. (customer internal data) driver.
The new category in store approach was presented to
Sales decline is due to a stronger competitiveness
in terms of promo pressure together with a greater
∂ to improve assortment compliance and visibility on Consumers divide beers into three types to match retailers’ main stakeholders for final approval.
shelf (browsing) to increase closure rates. different needs: lager beers for routine consumption
assortment complexity on shelf. The recovery Retailers shared assortment and sales data with
(food pairing), zero/radler beers to catch up with healthy
opportunity is increasing the reach of high spending customer trade marketing department.
trends and special beers for a rewarding moment.
consumers and the closure rate of shoppers. What KPI’s (if any) were used to Consumers identify four types of specialties: red, strong, The new display layout was developed in synergy and
measure the project outcomes? weiss and special lagers; all rest is quite confused. was implemented by cross functional teams of Birra
Peroni (customer trade marketing and sales teams).
Describe your target market for this ∂ Total sales Shoppers consume beer packed in glass sized both in
project. 33cl and in 66cl, while cans are chosen for out of home The implementation was constantly monitored at the
∂ Total no promo sales
occasions. In the last years, impulse purchase rate has points of sale level ensuring the maintenance of the new
Our target is beer shoppers in north of Italy which are ∂ Assortment detention
increased considerably and the most planned elements display layout.
also consumers in 90% of cases. are type and brand.
They buy 2 lt of beer every 3-4 weeks on Thus, our shelf layout reflects the shopper Describe the retailer resources assigned
average. fundamentals: to the project.
Only 50% of shoppers plan to buy the ∂ beer segmentation into lager, zero/radler and
category and impulse purchase is guided specialties The buying team shared internal data with Birra Peroni
team and contributed in setting category guidelines in
by the convenience/promotional lever, but ∂ the decision tree which separates can from glass,
terms of new display layout and assortment.
- if not enough appealing- the shopper 33cl from 66 cl and lastly identifies the brand
does not conclude the purchase.
∂ special beers organization by type Commercial team gave the permission to enter and to
work on shelf both during implementation and during
In few years, impulse rate moved from ∂ the convenience ladder
monitoring phases.
20% to 50% and the reason of this shift is
also the multiplication of skus on shelf. Category team prepared the display official internal
Briefly describe the key steps taken to
In order to build value, Retailers are also document released to points of sales
complete the project.
keen on attracting consumers in upper Retailers sales department was engaged to facilitate the
salary range, sensitive to healthy lifestyle. We shared the insights explained above with the execution.
retailers which chose Birra Peroni as partner to develop
a category approach.
The new category instore approach was developed in
synergy with the customers focusing on consumer’s
decision trees highlighting the segment of no-alcohol
and radler beers and typologies in special beers,
simplifying assortment of premium beers and increasing
readability of the shelf to grow both programmed and
impulse no promo purchases. The implementation was
constantly monitored at the points of sale level ensuring
the maintenance of the new display layout.

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RESULTS KEY LEARNINGS

What were the key quantitative results What were the key qualitative results? What were the major barriers faced What key advice would you offer to your
of the project? during the project? peers who are considering investing in
Visibility on shelf of category sub segment and of Birra
Category Management?
Overall, the project contributed to improve trend of both Peroni portfolio (products at eye level and hand level). We faced the following main barriers:
category total value sales and no promo value sales and The key advice is keep investing on shopper analysis
to reverse negative trend of no alcohol segment.
Thus, improved browsing quality facilitates shoppers’ ∂ international category partnership agreement with our
for a constant update of consumer trend and shopper
selection and purchasing process. main competitor. We overcame the barrier because
For the evaluation, we considered points of trend of our shopper study was unbiased and based on behavior and exploiting more interactive tools to better
We are also testing more interactive CRM tools to
variation and compared % trend vs LY of two periods: shopper behavior evolution giving an alternative to reach our shopper target.
promote innovation attracting upper class and young
the competitor approach where brand was outwardly
∂ as previous period P0 --> 3 months before project families.
the first and predominant driver.
implementation (1st quarter of the year) Include any links that lead to more
∂ as actual period P1 --> 6 months after project ∂ maintenance of display layout such as difficulties in information about the company, project,
keeping the display with new guidelines. We solved it website etc.
implementation
thanks to the support of our in-store accounts which
Total sales and promo sales % trend improved by 3 constantly visited stores and reworked the display if www.birraperoni.it
pts while no alcohol segment % trend varied 11 pts necessary
recovering a negative performance.
Furthermore, assortment compliance of retailers was What would you do differently if starting
close to 100% above other store formats (around 90%)
the project again?
Birra Peroni reduced also out of stock on shelf (-0,2%
P1 vs P0) The only improvement to suggest is focusing furtherly
on shopper data of each retailer to undertake new
Encouraging first results set also fundamentals to
initiatives better addressed to target specificity.
increase closure rate of our targeted shoppers such as
consumers in upper salary range (increase of no promo
sales) and sensitive to healthy lifestyle (growth of no
alcohol segment).

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 Outlet - Individual
Category Management on a Big Scale

Outlet-Individual
Category Management
on Big Scale
Graph. 1 – process overview: scalable Category Management with state-of-the-art software solutions

REWE, Coca-Cola, Hoffrogge, Germany

are assigned to the respective partner who has the best 3. Space Optimization
set of resources, skills and experience available for the
The results of the current space situation, supplemented
good of the project:
by shopper insights and hard sales data, reveal the
Sustainable outlet-individual optimization of space, tailor-made Category Management content. REWE store potential for optimization being displayed in
1. Data Management the Space Allocation Key (SAK). In order to ensure
assortment and placement in beverage stores and CCEP DE’s expertise in retailing and category
by using smart software solutions and dialogue- development flows permanently into this process and The confidentiality, integrity, availability and up- a high acceptance on the shop floor and still include
oriented cooperation. is used for further agile development of the software. to-dateness of different data sources is a crucial cross-outlet potentials, the SAK is not only based
The process is not limited to particular categories or preparation for efficient Category Management. In its on store-specific sales data but also on benchmark
Execution-driven Category Management projects ISO 27001 certified data center, Hoffrogge takes care data (e.g. locations of same region and/or store-type
distribution channels, but can also be applied for any
between manufacturers and retailers imply significant of the integration and maintenance of all relevant data. classification). In the beverage department it is crucial
other category, shop format or distribution channel.
challenges. Guided by the well-established ECR 8-steps This includes the continuous processing of market to consider both, sales value and volume, so that
Category Management standard process REWE, Within the Category Tactics the following process research data for the respective categories (more than the different space productivities of certain category
Coca-Cola European Partners Deutschland (CCEP provides the framework of the project execution. Year 110,000 items) as well as retailer scanning data (more segments are reflected in an appropriate way with
DE) and Hoffrogge are implementing successfully by year the project partners evaluate the success of than 50,000 items) of about 4,000 stores. regard to the available shelf space in the store.
outlet individual optimizations with high efficiency and their ways of working. All responsibilities and actions
great results. The focus here is on joint growth at the In the master item data base the required standard
PoS through consumer-oriented product ranges and attributes (e.g. category, segment, manufacturer, brand,
shopper-driven allocation of floor and shelf space. packaging, content, product dimensions, etc.) are
Facts & Figures necessary for customizing a shopper-driven ruleset as
a prerequisite for the highly efficient planogram creation
Management summary process.
In a nutshell, a sustainable beverage department ∂ GS1 ECR Award Winner Demand Side 2014
optimization for thousands of stores is only possible
∂ more than 1,100 stores optimized 2. Current Space Situation
through efficient processes with clear responsibilities. since 2013 The second process step is to determine the status
The space allocation, the assortments, and the shelves
quo of the current space situation. The recording of
of a store are in constant interaction with each other ∂ 3 hours of planning needed per store
local shelf structures and their arrangement in the store
and need to be managed by the respective experts with
the help of integrated software solutions. The focus on
∂ significant performance plus (value & context form the basis for all further activities.
volume) for NAB category in optimized
the shopper needs and on site execution are of central REWE stores are encouraged to notify when a new
stores
importance. optimization is desired. Thereafter field service

REWE, CCEP DE and Hoffrogge have developed an

∂ complex data processing of relevant employees carry out the recording of relevant data such Furthermore, the project partners develop and review
beverage categories with 110,000 SKUs as entrance and checkout zone, shopper path and the a joint store vision involving the right sequencing and
award-winning process. The partners ideally combine allocations for all categories based on shopper insights,
(market research data) and 50,000 SKUs like by using the mobile Category Management suite
their core competencies. Hoffrogge provides powerful conversion restrictions and category trends. The Store
(retailer scanning data) SAM® (= Shopper Activation Mobile) at the PoS. The
fully integrated software solutions and a process Maker® software enables a customized translation of
current space plan reflects the existing allocation and
infrastructure enabling the highly efficient creation of this store vision into a ruleset, thus enabling scalable
shares of categories, segments or manufacturer blocks
on the shelves. space optimization at the push of a button.

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 Outlet - Individual
Category Management on a Big Scale

6. Planogram Creation 8. Process Monitoring An integrated state-of-the-art software infrastructure

provides the technical basis to translate shopper-
A critical success factor for a full-scale implementation Another major advantage of outlet-specific optimization
driven store and shelf visions into a ruleset allowing the
is the local accuracy of the planograms. Experience of these tactics is the knowledge of the product range
category experts to create planograms at the push of a
has shown that the stores are more willing to implement for the individual store. As a side effect you simply
button. Supplemented by efficient processes and a well-
a placement optimization, if it is fitting 1:1 to the local
coordinated project team with skill and will this leads to a
demand and shelf structure. Furthermore, shopper
powerful and long-term approach for success.
insights and shelf vision objectives differ from segment
to segment and need to be considered holistically for the
good quality of the project content.
Quotes of the project partners
The solution to this challenge is a customizable,
shopper-oriented ruleset integrated into the Shelf
Maker® software enabling back office users to produce As the different project partners have
tailor-made planograms corresponding to the overall been working together in this constellation
shelf vision and the local requirements (e.g. shelf
for more than seven years now, we can
dimensions and sales data) at the same time.
4. Range Finding rely on well-established processes and
Thanks to the expertise of the project partners and the responsibilities. Our retail stores and
The strategic work on consumer-oriented product ranges can measure the range compliance. Therefore, the
previously listed process input the optimisation of the partners follow the process with a high level
is a key tactic of each Category Management process. project partners carefully track with the web-based
beverage department in a store can be done altogether
Due to the high level of complexity on a regional or even of interest and commitment as experience
in less than 3 hours. Implementation Monitor the execution quality of each
local level, a two-step assortment process is applied in store during the year. With the Status Monitor all has shown the success of the project.
order to identify the best possible range. The first step involved persons can follow online the processing status Marcel Wagner, Senior Category Buyer,
is to determine the right assortment for each regional as well as all handouts for each outlet. REWE
cluster (up to 26 cluster regions) reflecting the most
frequent shelf structures/sizes and fulfilling the desired Regular success evaluations comparing a sample of
market coverage for each segment. optimised stores with a group of appropriate control
outlets have shown that participation in this process will Within this project we have managed to
The main objective of the strategic assortment analysis lead to better results in terms of sales value and volume let shopper insights and in-depth category
per cluster is a critical evaluation of all individual items for the total category of Non Alcoholic Beverages. know-how to be executed on the shop floor,
on the basis of various key performance indicators from
helping hundreds of participating retail
market research and PoS data. The project team uses
the Range Finder® software to facilitate this process. stores to successfully exploit their market
potential in the Non Alcoholic Beverage
5. Range Adaption category.
The second step within the range optimization workflow 7. Execution On site Oliver Raber, Head of Category
is the adaption of the above described regional cluster Development, CCEP DE
“Strategy is 10% - execution is 90% of success”.
assortment to the local demand of each individual store.
Following this wisdom a good plan is crucial. Especially
Based on the strategic range decisions that were taken
when implementing department-wide optimizations,
before and the local scanning data, the Range Adapter® A dialogue-oriented project team bringing
there are logistical and organizational challenges
calculates an outlet-individual assortment for each
to consider. Among others this refers to the on-time in the perfect mix of skill and will, good
category segment.
availability of new items, the timely sale of residuals to data sources and a clear shelf vision for
Key Learnings
The algorithm adds well performing “Local Hero” items make room for the new listings as well as a 1:1-fitting the project facilitate excellent Category
to the range as well as it removes poorly performing planogram to save time during the execution. This cooperation has shown that scalable Category
Management execution. Scalable software
“Local Loser” items from the cluster range, but only for Management on an individual store level will succeed if
The project partners provide outlet-specific documents several prerequisites can be fulfilled. On the one hand, solutions and efficient processes can make a
that particular store. Another essential aspect is the
such as assortment change lists and tailored a comprehensive, good quality data management is key difference.
demand-driven adaption of each front facing with regard
planograms to prepare for the execution with sufficient to take decisions based on the right facts and figures.
to the outlet-specific sales data. The risk of out-of-shelf
advance notice. Regional sales area managers and
Wilhelm Hoffrogge,
situations resulting in lost sales can thus be reduced at Embedded in a well-researched set of shopper insights
other project partners provide further advice and Managing Director, Hoffrogge
its best. and recent category development, this leads to an ideal
assistance on site. setup for a sustainable Category Management process.

108 109
 Bringing the Petfood category into PROJECT METHODOLOGY
the E-commerce channel with an
Briefly describe the project background/ List and give a brief overview of the main
E-commerce Purchase Decision challenge and the rationale that led the objectives of this project.
Tree implementation team to propose this project.
The objectives of the project were numerous:
COMPANY BACKGROUND In a very competitive environment, the eCommerce
channel is one of the priority channels for our Greek
∂ Apply the category Shopper tree guidelines from
Purina team in order to facilitate the Shopper
This case study is submitted by: market. experience in our eTailer
Eftychia Baka
The Nestle petfood category, in order to facilitate
shopper’s navigations and improve product findability,
∂ Increase the sales for petfood category
Title:
E-commerce Manager
has cooperated with the biggest online retailer in the ∂ Increase Purina’s sales and market shares in the
Greek market, e-fresh.gr, in order to optimize the specific channel
Company Name: category layout for the petfood category to achieve
Nestlé Hellas SA bigger market shares and increase online sales. What KPI’s were used to measure the
project outcomes?
Product Name & Relevant Category:
Describe your target market for this
Purina, petfood with 2 subcategories
project. ∂ Online sales
Dog food: dry dog food, wet dog food, snacks
(Friskies, Purina One, Dentalife)
∂ Online Market shares
The pet owners (cat, dog owners) in Greece buying
Cat food: dry cat food, wet cat food, cat litter online in our eTailer .
(Friskies, Purina One, Gourmet, Felix)

Location of Marketplaces:
Greece
∂ Produce and develop category specific market
Annual Local Market Sales: reports and analysis
The Greek market total grocery sales : €10bn Our strength is the strong commercial and analytical
Total eCommerce sales in eGrocery sector : €43mn mindset of our people. Nestle has a deep knowledge
of the categories’ dynamics and of relevant growth
How many employees work in the relevant drivers. We are considered as category experts by the
marketplace? customers in the majority of the categories we operate,
due to long term and consistent presence in the market
Commerce team in Nestlé Greece : 5 members
place and our wide pool of consumer/shopper/customer
Total Nestle employees : 1000 persons insights. We have a strong brand heritage and a solid
know how in presenting category growth initiatives to
How significant is your product within your customers.
chosen product category?
Purina petfood represents the 8.3% of total Nestle How many people work on the Category
Greece revenues Management team that delivered this project?
Petfood category in the grocery channel represents the ∂ 7
4.3% ∂ Category management team : 5

How advanced is Category Management within

∂ Category manager for Purina team (2 persons)

your company?
∂ Category management lead (1 person)

Advanced
∂ Category management specialist (2 persons)
∂ eCommerce team (ecommerce team is part of the
The role of the category manager in Nestle is: category management team of the
company) : 2 persons
∂ Most actively collaborate with retailers in providing
analytics to support decision making and guidance
List the retailers or suppliers you worked with on
∂ Produce and develop customer specific sales and this project (list in order of involvement where
assortment analysis possible):
∂ Attend customer meetings to make recommendations Online retailer’s shop – the biggest pure player in the
and suggestions on assortment and space Greek market (https://www.e-fresh.gr/) – delivering to all
management related issues (decision making is at the Greece
sole discretion of the customer)

110 111
PROJECT IMPLEMENTATION RESULTS

Describe the project framework and what Briefly describe the project background/ What were the key qualitative results of
tools you used. Describe the brand resources that were challenge and the rationale that led the the project?
assigned to the project. team to propose this project.
Our local category management & ecommerce team Better shopper’s experience for the eTailers Shoppers.
has leveraged the expertise and the researches of our ∂ Brand eContent (photos, videos, marketing texts, +22, 5% in total customer turnover H2 vs H1 2018 Better brand image for our Purina products.
global teams to optimize the category of Petfood inside hero images) – brand guidelines, category and
32% category growth (sell out) Q1 2019 vs Q1 2018 Win – win strategy with our eTailer: Be the preferred
eFresh shop slider banners, newsletters, FB campaigns
Online market shares: NPP +310 bps Q1 2019 vs parther for our eTailer in petfood category.
∂ Shopper researches from our local teams ∂ Brand managers
Q1 2018
∂ Google Analytics stats from eTailer website ∂ eCommerce manager

∂ eContent Manager
Briefly describe the key steps taken to
complete the project. Describe the retailer resources that were
Step 1: Our customer has briefed us about the need to
assigned to the project. KEY LEARNINGS
expand the petfood category in their channel
eTailer
Step 2: We have done a diagnostic control in their What were the major barriers faced What key advice would you offer to
website in order to identify the strengths,
∂ IT manager & designer - from the eTailer website
for the development of the new menu in the during the project? your peers who are considering
opportunities, weaknesses and threats of the
Shopper experience
website investing in Category Management
Integrate correctly all the data to eTailers website
Step 3: We have optimized the assortment and the
∂ Marketing manager - from the eTailer website
Always work hand in hand with eTailer to evaluate the
for the brand guidelines and Google Analytics
eContent of our products category management activation
monitoring What would you do differently if starting
Step 4: We have optimized shopper tree – based on
∂ Buyer - from the eTailer website for the the project again?
our global researches with the cooperation of
development of the assortment Include any links that lead to more
our eTailer In reality, nothing. Our initial diagnostic control in information about the company, project,
eTailers website gave us a clear view about the vision of
Step 5: We have changed all the categorization and website etc.
the product
filters of the category
https://www.e-fresh.gr/el/pet-shop
Step 6: We have measured the results after 3 months

112 113
 Delivering a comprehensive consumer PROJECT METHODOLOGY
solution in health & wellness categories
through a superior shopper experience
Briefly describe the project background/ List and give a brief overview of the main
based on shopper mission insights challenge and the rationale that led the objectives of this project.
and superior Shopper Marketing team to propose this project. The main objective is to achieve consistent store layouts
and Category Management in-store An outcome of the Commercial Plan was the need to to better reflect the SuperValu format and make stores
execution existing category space work harder, whilst keeping
COMPANY BACKGROUND provide our consumers with a better range of Healthier
range reduction & consumer disruption to a minimum,
and allergy free products. The agreed approach was to
land the new ‘on trend’ categories - Health & Wellness without impacting existing sales & margin performance.
This case study is submitted by: consistently in all Stores. The challenge was to review
Paul Corcoran all existing category spacing and relay with the inclusion
What KPI’s were used to measure the
of the New Health & Wellness categories.
Title: project outcomes?
Range and Space Planning Manager Range Count / Rate of Sale / € Return Per Linear Metre
Describe your target market for this / Margin
Company Name: project.
Musgrave Retail Partners Ireland
Gluten intolerant consumer
Product Name & Relevant Category: Informed, curious consumer seeking a healthier
Dairy, bakery, fresh etc. alternative lifestyle.
Introduction of Health & Wellness portfolios into the
Ambient Staple category

Location of Marketplaces:
Republic of Ireland

Store Format:
Superstore

Annual Local Market Sales:

> €1 Billion

How many employees work in the relevant

marketplace?
3000 Direct & 15000 Indirectly (Store Personnel)

How significant is your product within your

chosen product category?
Extremely Significant

How advanced is Category Management within

your company?
Very advanced

How many people work on the Category

Management team that delivered this project?
3

List the retailers or suppliers you worked with on

this project:
∂ Retailers (Cluster Stores – 6 stores)
∂ Retailers (Trial Stores – 6 stores)
∂ Simply Wild
∂ Valeo Foods
∂ Kelkin

114 115
5
PROJECT IMPLEMENTATION RESULTS KEY LEARNINGS

Describe the project framework and what ∂ The loosing categories were typically ambient Juice What were the key results of the project? What were the major barriers faced
tools you used. (€237 / lin mtr), facial tissues (€216 / lin mtr), instant during the project?
hot snacks (€326 / lin mtr), soup (€288 / lin mtr) The key matrix to determine success is € Return Per
Range selection - Global store safari Linear Metre. Engaging retailers of the proven business case to
∂ Trial results of all new initiatives were analysed to
influence them to reduce existing category spacing for
Defining consumer shopper mission – Consumer determine Sales performance ROS and Euro Sales Achieving 100% implementation in all stores
the inclusion of new Health & Wellness Categories.
insights, supplier insights & retailer insights and Margin return per bay
Applying of Range Process – selection of ideal range by ∂ Independently audited the existing category space in What were the key qualitative results of Providing an appropriate supply chain to ensure strong
all 165 stores to establish the actual store layout on shelf availability throughout the estate of SuperValu
bay size & store size the project?
stores.
Store Environment – Ideal equipment type. ∂ Retailer & RM engagement was key throughout the
process Meeting Consumer Needs & Positive Consumer
Reactions What would you do differently if starting
Briefly describe the key steps taken to Describe the supplier resources that were First to market within a ‘traditional’ store environment the project again?
complete the project. assigned to the project. Strong PR throughout the industry Stronger and earlier engagement with all retailers
∂ Started with developing the Ideal format layout Trading / Sales / Marketing / Store Development
∂ Identify the best location in store for all new category
What key advice would you offer to your
initiatives Describe the retailer resources that were peers who are considering investing in
∂ Analysed space performance using € / Linear Metre assigned to the project. Category Management?
to determine the existing category winners & losers
The main objective is to
∂ Sense checked the looser categories to see that they Council Members Have a robust process in place that all stakeholder
were of strategic value Central Sales Team & Retailers achieve consistent store believe in and fully operate to.
∂ Reduced the space of looser categories as much as layouts to better reflect the
possible, yet retained breath of range (key lines) and Include any links that lead to more
retained as much sales as possible SuperValu format and make
information about the company, project,
stores existing category space website etc.
work harder
https://supervalu.ie/
https://www.musgravegroup.com/

116 117
 Reinventing and reinvigorating the
in-store shopping experience for
the Non-Alcoholic Ready-to-Drink
Beverages category
COMPANY BACKGROUND

This case study is submitted by:

Antoine Chabret & Ibrahim Lazeb

Title:
Category Management Strategy

Company Name:
Coca-Cola European Partners

Product Name & Relevant Category:

Non-Alcohol Ready to Drink (NARTD) Beverage

Location of Marketplaces:
Western Europe, including France, Spain, Portugal,
Belgium, Scandinavia, Germany, Great Britain. CCEP
is the first European bottler with a 11 billion euros global
turnover with significant market shares on NARTD
category.

Annual Local Market Sales:

> €1 Billion

CCEP France annual turnover is 2.2 billion euros,

representing 20% of European global turnover of Coca-
Cola European Partners

How many employees work in the relevant

marketplace?
2,600 employees

How significant is your product within your

chosen product category?
Extremely significant.

How advanced is Category Management within

your company?
Very advanced.

How many people work on the Category

Management team that delivered this project?
6 people

List the retailers or suppliers you worked with on

this project (list in order of involvement where
possible):
French retailers:
∂ Auchan
∂ Super U
∂ U Express
∂ Casino
∂ Cora

118 119
PROJECT METHODOLOGY PROJECT IMPLEMENTATION

Briefly describe the project background/ CCEP IMPLEMENTS A NEW CATEGORY VISION TO DEVELOP THE WHOLE
Describe the project framework and Briefly describe the key steps taken to
challenge and the rationale that led the what tools you used. complete the project
NARTD CATEGORY AND BENEFIT FROM ITS FULL POTENTIAL

team to propose this project. The right brands

The main objective was to start from a complete First of all, it was essential for us to take the time to
portfolio to meet all
consumers’ needs

At Coca-Cola European Partners, we set up a strong category vision (based on category trends, information clearly define the category, its composition and its
study protocol that enabled us to understand the Impactful
The optimal selling
space
from consumers and buyers) to create and deploy a challenges. Then, we chose to set up a strong and
in-store

new merchandising concept. Our framework is made up complete study protocol with our partner IRi, based
CONSUMER -

following situation: the NARTD universe in store is a

activations ORIENTED

A new merchandising concept

poor representation and does not maximize the full

developed and tested in 2019
of 5 essential stages: on quantitative and qualitative stages. Thanks to that,
we were able to precisely define our objectives and
Foster impulse throughout the

potential of the category. 4

consumer journey

1. Define the category and its scope, what we know

4
our levers of action to unlock the full potential of the
Among FMCG products, NARTD category is one of about it and what challenge or opportunity we want
category.
the least attractive areas in-store. The latter is seen as to address.
List and give a brief overview of the main We used different methods like design thinking modes
a functional place like a storage space, whereas the 2. Launch data crunching and all the studies we
main driver for buying NARTD products is pleasure. objectives of this project to make our ideas a full concept and chose our
needed to better understand all expectations of our
Moreover, shoppers want now new product offers privileged and unique partner for the whole project :
Our merchandising concept has two main objectives consumers, shoppers and retailers.
to emerge on shelves, such as organic drinks or HMY (design, installation, maintenance).
both for shoppers and retailers. 3. Analyze the results to define more precisely our
innovations. However, these kinds of products do not One key success factor was to share our thoughts and
clearly emerge on shelves today. For shoppers, the objective is to improve the in-store objectives and build the best strategy for our
development stages with our customers (methodology,
experience and make the NARTD universe more concept.
Furthermore, the NARTD universe does not enable results of studies, thinking and projects). We thus
understandable and readable. 4. Once we have the necessary support and were able to convince more easily retailers to launch
retailers to maximize growth for the category either.
When buying a NARTD product, the shopper journey is For the retailers and their suppliers that compete on investment from our top management, go and merchandising tests in stores.
rigid and quick (48 seconds), like a real routine. There this market, our objective is to improve global NARTD present our project to retailers to get a strong
The last step was to present the project results to our
is neither impulsion, nor exploration inside the universe, market image, develop the average basket and collaboration and test our concept.
top management with a focus on a precise ROI vision to
whereas both could lead to an average basket increase purchase frequency, and finally enhance discovery and 5. Launch studies to evaluate the results and define our future strategy and future investments.
and thus growth for the NARTD category. exploration inside the universe. performance of the concept, take decisions and
optimize.
Describe your target market for this What KPI’s (if any) were used to measure We used tools like Sharepoint or Cloud, organized
project. the project outcomes? meetings (brainstormings, workshops) and set up
SWOT, Porter’s forces model and ROI.
This merchandising project aims to implement a The success of the project is based on achieving KPIs
category vision in-store for the whole NARTD category on both quantitative and qualitative issues.
in France. As NARTD category penetration rate is
From a quantitative point of view, we aimed at
99,6% in France, we can assume that our target market
increasing sales for the whole NARTD category. For OUR NEW NARTD MERCHANDISING CONCEPT
is the whole French population.
every test store with our merchandising concept, IRi TESTED AND IMPLEMENTED IN 18 STORES IN 2019
We also aim at working hand in hand with all retailers in defines a control store of the same retailer and that
France, that is why we do not want to exclude any retail
customer, so any part of the French retail distribution.
has similar selling surface, geographical area, global
turnover and promotional weight. Then, we measure the 1 Objectives 3 •
Implementation
18 stores: 9 HM, 6 SM et 3 convenience stores
The ambition of the project is to target all different growth in test stores and we compare it to the growth • Develop the average basket and enhance exploration
• A flexible concept that can adapt to every channel

formats of stores (hypermarket, supermarket, we notice in control stores on the same periods (before • Improve global NARTD market image in shoppers’ minds
Photos

convenience) to show that our concept can be adapted and after project development). • Drive traffic in store

to all retailers. From a qualitative point of view, we focus on 3 KPIs :

∂ Improve NARTD category image

NARTD IS A MAJOR CATEGORY AMONG ALL FMCG PRODUCTS
WITH HIGH POTENTIAL ∂ Develop the average basket and purchase frequency 2 Great principles
NARTD:
#1 FMCG CATEGORY
CONITNUOUS GROWTH
SINCE 2016
WITH GREAT POTENTIAL IN
FRANCE
∂ Enhance discovery and exploration in the universe • Create an open NARTD universe

• Design a real shopper experience in-store

∂
NARTD sales evolution – Value (K€) Per Capita – Number of bottled drinks liters / year

7 687 009
7 739 175
280
302
343 To follow this, we have worked again with IRi to have • Make new drinking segments emerge
Global turnover Frequent purchase
7 573 928
174
202 208
precise and reliable results. The study institute has • Place emphasis on natural products
organized several shopper interviews in stores both
among all French 7 391 893
consumers

7,7 €Bn 99,5% Penetration

10
before and after the project development to assess
Rate
2016 2017 2018 2019
Source: Nielsen
Purchased a
39 times
MAT P12 2019
year
+1,5% average turnover growth 10

the qualitative impact of our project.

Source: Kantar Panel per year
(MAT P12 2019)
Since 2016

Source : Nielsen Total France 2016 - 2019 Source : Statista 2019 (in bottled drink liters per inhabitant)

3 3

120 121
Describe the brand resources that were Describe the retailer resources that OUR NEW NARTD MERCHANDISING CONCEPT
assigned to the project. were assigned to the project. Generally TESTED AND IMPLEMENTED IN 18 STORES IN 2019
speaking, two different retailers teams
Internally, lots of people contributed to this innovative
project :
were involved in the project. 1 Objectives 3 •
Implementation
18 stores: 9 HM, 6 SM et 3 convenience stores
• A flexible concept that can adapt to every channel

∂
• Develop the average basket and enhance exploration
Multi-functional leadership team First of all, our concept was presented to our customers Photos
• Improve global NARTD market image in shoppers’ minds
• Marketing Director, National Sales Director national Headquarters team. It was important to engage
• Drive traffic in store
the people in charge of the national merchandising
∂ Market & Category Strategy team strategy in our customer’s organizations. It was also
• Define the category and its scopes very enriching for us as we confronted our vision
• Launch data crunching and a complete study
protocol
with NARTD category experts: FMCG Category
Management Director, NARTD Category Management
2 Great principles
• Create an open NARTD universe
• Analysis of the study results to build our strategy Director, NARTD buyer and merchandisers. Their • Design a real shopper experience in-store

• Definition of our merchandising strategy leaning on insights were key to adapt certain elements of our • Make new drinking segments emerge

the study insights concept and make it more relevant. • Place emphasis on natural products

• Presentation of the project to our retail customers Once our approach was validated by national
10
10

• Operational project development in store in Headquarters teams, we met local store directors to
partnership with our technical supplier HMY present them our project and to convince them to deploy
the concept in their store. Then, we were in touch with
∂ Shopper Marketing Manager
store directors and NARTD managers. The objective
PICTURES FROM THE FIRST IMPLEMENTED STORE: CORA GARGES !
• Design development
was to understand well the store particularities in order
∂ Business Intelligence to make this project develop.
BEFORE
• Methodology definition for quantitative and
qualitative studies

Several external partners also played a role in this

project:
It was important to engage the
∂ Study institute IRi
• Definition and follow up of the study strategy people in charge of the national
∂ Havas (Design agency) merchandising strategy in our AFTER
• Design development customer’s organizations.
∂ HMY
• Technical partner who developed the project in
store with us THE NARTD CATEGORY IS DRIVEN BY NEW CONSUMERS’ NEEDS
AND EXPECTATIONS
PICTURES FROM THE FIRST IMPLEMENTED STORE: CORA GARGES !
NEW THAT DO NOT
CONSUMPTION TRENDS EMERGE IN SHELVES

French people are increasingly concerned with their consumption of day-to-day

products, specially for NARTD:
It is really difficult for shoppers to identify
and understand the NARTD offer
+ -
(RETAILER
HQ)
NATURALNESS SUGAR

It is an overstocked area that does

HOW TO COMBINE PLEASURE AND
#1 HEALTH
#1 #2
#2 not bring value to healthy products
BOISSONS
BOISSONS BOISSONS
BOISSONS
BIO
BIO NATURELLES
NATURELLES (STORE)
47%
47% 44%
44%
Consumers have new expectations about NARTD segments, particularly Soft
Drinks: A dedicated cooler area with fresh drinks
My main problem is that there are lots of
products, innovations... I can’t put to boost IMMEDIATE CONSUMPTION
#1
#1
#1 #2
#2
#2
ORGANIC
BOISSONS
BOISSONS NATURAL
BOISSONS
BOISSONS
#3
#3
#3 #4
#4
#4 everything on shelves
NOUVEAUTÉS
INNOVATIONS
NOUVEAUTÉS APÉRITIFS
APERITIF
APÉRITIFS
BIO
DRINKS
BIO NATURELLES
DRINKS
NATURELLES
47%
47% 44%
44%
40%
40%
40% 37%
37%
37% A new concept named « PICK & MIX » A specific NATURALNESS pole, which is
47% 44% (STORE)
3030% innod’inno
% attentes expectations
vs 11% PGC
30 % attentes d’inno vs 11% PGC
vs to manage torn packs and offer located at the section’s entrance to meet
11% FMCG
shoppers a personalized experience consumers’ expectations 16

#3
#3 #4
#4
NOUVEAUTÉS
NOUVEAUTÉS APÉRITIFS
APÉRITIFS

122
40% 37%
123
40% 37%

30
30%%attentes
attentesd’inno
d’innovsvs11%
11%PGC
PGC
RESULTS KEY LEARNINGS

What were the key quantitative results What were the key quantitative results As we know there is a hectic life in stores and that many
of the project? What were the key qualitative results of of the project? things can change in the short-term, we would set up
the project? a stronger store follow-up in order to make the sales
First of all, our new merchandising concept has proved To develop the project, we intended to associate with representative more responsible for keeping the concept
to be successful in terms of sales development. We first reached very high shopper satisfaction with other NARTD national brands. The main challenge as it was initially designed.
NARTD category volume growth in our test stores is 6% a score of 90%. Going from 7.4/10 before the project was to convince other brands to work with us on
higher than in control stores. Not only do soft drinks, deployment to 8.1/10 after, our shoppers evaluated the this innovative concept but we did not succeed to.
What key advice would you offer to your
which represent CCEP key category, benefit from this project as the best transformation among all FMCG Subsequently, our goal was to have people join this new
merchandising project (+4%), but so do water category categories in France. Consumers told us they had more merchandising vision but it was difficult as every brand
peers who are considering investing in
(+7%) and juice one (+6%). pleasure when purchasing a NARTD product and were develops its own category vision. Category Management?
exposed to more choice thanks to the organization of
We have also measured segment performances inside Next, question of geographical dimension arose In our opinion, when considering investing in category
the products inside the universe.
soft drinks category and all of them are on a positive because our deployment was carried out on the whole management it is necessary to have solid knowledge of
trend. Here are a few examples: Colas +4%, sparling Beyond shopper satisfaction, we managed to create a French territory. With HMY, we have undertaken the the sector, the market but also consumer expectations.
fruit drinks +7%, still fruit drinks +4%, ready-to-drink strong partnership with our retail partners. They have implementation of an agile process to manage all store It is key to precisely define your category. Leaning
teas +6%, energy drinks +7%, tonics +7%. understood our willingness to set up a real category deployments. It was important to ensure that information on significant and various expertise, it is also very
vision for the NARTD market. Moreover, our concept circulated well between all stakeholders involved in the important to carry out quantitative and qualitative
Finally, we can notice that some product categories,
has enabled our customers to save time and energy project. studies to assess the relevancy of what you are
on which we make a special focus in the universe, are
when refilling the shelves as it is easier for them to achieving.
on the increase as well. For instance, natural drinks Finally, the layout of stores differs from one point of
understand the whole NARTD universe.
(organic, well-being or premium teas) sales increase by sale to another. We thus had difficulty to adapt to every It also seems judicious to analyze the results obtained
10% in test stores vs control stores. In the same way, To go further, we keep going on sharing some insights store to meet the implantation needs. It was difficult in order to be able to continuously improve your project.
immediate consumption is boosted (+42%) thanks to with our clients and working hand in hand to build, adapt to technically standardize our concept as every store We try to remain as open-minded as possible because
a specific cooler area where shoppers can enjoy fresh and improve our concept in-store. We really want to co- is different from one another, which can result in an every remark, every shopper or customer insight can
drinks. create this category vision with them. increase of our costs. lead to an improvement of our concept.
Finally, the training of the various stakeholders in the
What would you do differently if starting store deployment process is a point that should not
the project again? be overlooked as part of this mission. All Category
Management and Shopper Marketing plans must focus
We would set up the establishment of a validation unit on a solid basis of consumer and shopper insights. It is
for the various elements of the concept when they were important to develop this foundation as early as possible
created in order to be certain that they were correctly and keep it updated.
understood.
A NEW MERCHANDISING CONCEPT THAT DRIVES GROWTH FOR THE WHOLE NARTD CATEGORY

Total NARTD NEW DRINKING SEGMENTS emerge: NATURALNESS at the very heart of
consumption trends AN INNOVATIVE CONCEPT THAT IMPROVES NARTD ATTRACTIVENESS AND GLOBAL IMAGE
INDEX 106
SMALL PACKS

WATER: 107
IMMEDIATE
CONSUMPTION

SOFT: 104 JUICE: 106 IMPROVE NARTD MARKET DEVELOP THE AVERAGE BASKET ENHANCE DISCOVERY ET
ORGANIC WELL-BEING LEMONADES PREMIUM TEAS IMAGE AND PURCHASE FREQUENCY EXPLORATION

SEGMENTS Performances APERITIF

90%  MULTI-PURCHASE *
SATISFACTION
COLAS : 104 + 7 pts + 39%
STILL FRUITS: 104 of shoppers discover
SPARKLING FRUITS: 107
ENERGY DRINKS
8,1/10 (+0,7 pt) NEW DRINKS
58% 65%
RTD TEAS: 106 THE BEST TRANSFORMATION
AMONG ALL FMCG CATEGORIES
TONIC : 107
KIDS
ENERGY: 107
LIMES / LEMOS: 100
= + PLEASURE + CHOICE
 PURCHASE FREQUENCY**
TIME spent inside
the NARTD universe

SPORT : 107
8,4/10 8,6/10 + 10 pts + 7%
(+0,3 pt) (+1,9 pt)
Methodology for the quantitative analysis. Period : 10 weeks after implementation of CLP concept vs 10 weeks before (the week during which the concept is installed is withdrawn). 23
Stores : Every CLP store is compared with a « twin store » : same retailer, similar surface, geographical area, global turnover and promotional weight. This study was carried out on 6 implemented stores. * % of shoppers who purchase at least 2 NARTD products Q:
The index stands for the performance of CLP stores vs their twin stores, in volume without promotions. ** % of shoppers who purchase NARTD products at least once a week

124 125
 PROJECT METHODOLOGY
Applying a collaborative approach
driven by shopper insights to create Briefly describe the project background/ List and give a brief overview of the main
new growth in the Dairy category challenge and the rationale that led the objectives of this project.
team to propose this project.
The focus of category collaboration efforts between key
COMPANY BACKGROUND suppliers and Metro aimed at two core areas:
Changing consumer needs and continually disruptive

Company Name:
forces in the marketplace had eroded core grocery ∂ developing a deep understanding of Shopper
category sales in the traditional supermarket channel Need States based on the behavioural data, which
Metro Canada globally for a decade: Metro’s results had followed established the hierarchies of Shopper Decision
the curve. Meanwhile, differentiation in product range, choices in each sub-category and category. For
Product Name & Relevant Category: presentation, and customer experience decreased as a example, the shopper science ranked the most
Several departments across the store including Dairy, ‘sameness’ set in across market competitors and even important factor in Shopper decisions for each
Frozen, Non-Foods, Beverage & Snack, Breakfast, within sister value propositions / banners at Metro. commodity, e.g., brand, pack size, flavor profile,
Fresh, thereby engaging multiple categories and across consumer benefit, etc.
categories Further, ways of working had evolved to allow little time
for category managers to plan strategic changes. Like ∂ developing and optimising assortments based on
Location of Marketplaces: industry peers, conversations with suppliers devolved these need states, along with data-led micro and
Québec and Ontario, Canada. to focus more around price and promotion than it did on macro adjacencies and flow to simplify shopper
holistic category management. Heads down, the vision choices. The objective was to grow incremental
Store Format: forward to growth and innovation in categories and unit sales and margin by improving the shopper
As a food and pharma retailer, franchisor, distributor, departments became less clear. experience – making choices easier - thereby
and manufacturer, Metro operates or services a network improving satisfaction of the category experience.
of more than 1800 pharma and food stores under Four (4) guiding objectives were co-created and agreed
several formats and banners including Metro, Metro Describe your target market for this
by Metro and its suppliers:
Plus, Super C and Food Basics, Jean-Coutu, Brunet. project.
∂ Innovation – both the retailer and brands (NPD) be
Annual Local Market Sales: A segment of Loyal shoppers was identified who drove recognized as offering innovation to shopper
> €1 Billion the majority of sales, but who also had significant ∂ Optimization of range to maximize sales
headroom in categories that were identified as strategic
How many employees work in the relevant for ‘core’ and ‘growth’ according to the shopper data
∂ Improve the Shopping Experience to increase units
and visits
marketplace? science. The data science innovation was in defining
90,000 category roles and levers according to shopper ∂ Improve Value Perception for both retailer and brands,
as appropriate
behaviors, as well as linking both the commercial and
In your local market, how significant are you shopper priorities. For example, the science examined
within your chosen category? behavioural engagement (frequency & penetration), What KPI’s (if any) were used to measure
Leader in Pharma and Food in Quebec market and category importance to shopper’s choice of retailer, and the project outcomes?
Number 2 in Food in Ontario market. emotional and cognitive engagement (thinking & feeling
about a category). The success of the project would be judged on achieving
How advanced is Category Management within
an increase in the sales growth for each overall
your company?
department or category (vs the growth rate average
Advanced over the last 3 years) whilst reducing the range where
the data showed high product substitutability, and
9. Number of people employed in Category
Management team in your Company? A segment of Loyal shoppers conversely, by filling unmet shopper needs through the
introduction of new products where the data indicated,
150 in Ontario and Quebec from merchandizing and was identified who drove the e.g. kombucha.
central procurement
majority of sales, but who also Sales growth would also be reflected by improvements
List the retailers you worked with on this project? had significant headroom in in shopper loyalty, i.e., growing the number of new Loyal
Metro Inc (Canada) shoppers engaging in the department or category, or by
categories that were identified incremental spending by shoppers already ‘loyal’ to the
as strategic for ‘core’ and category.
‘growth’ according to the
shopper data science.

126 127
PROJECT IMPLEMENTATION

Describe the project framework and To elevate the voice of the shopper, dunnhumby shared
Briefly describe the key steps taken to each category’s decision hierarchy; such a hierarchy
what tools you used. access to summarised shopper data and acted in the is critical to ensure that all shopper needs are met
role of facilitator and coach for this new collaborative
complete the project
by at least one offer in the category. Note that in the
A revolutionary collaborative reinvention model was model, taken from best practices learned with its other example below, product formulation is the first heuristic
A key step at the start was to win the trust in the process
introduced, driven wholly by a shopper-first vision and global clients. of the shopper choice criteria, and the second heuristic
of ‘doing business as unusual’ from both the supplier
shopper-level data. The ambition of this collaborative The overall framework for the project is shown in the community and Metro’s own category managers; this varies by formulation. Brand is the third-level decision
model aimed at changing the shopper experience chart below. The so-called ‘Maverick’ model describes was accomplished with strong senior management criteria, followed by flavor according to the shopper data
“from the floor tiles up” based on both quantitative and a comprehensive and integrated process of four (4) endorsement and through a pilot in the Dairy category. science.
qualitative shopper insights to inform fundamental sequenced phases of work and thirteen (13) specific
The first phase delivered a detailed understanding of The third phase focused on collaborative workshopping
category management principles. workshops that informed the traditional 8-step Category
the external market and of key brand aspirations, a of the Category Business Plan, covering all steps of the
Suppliers were invited to bring their insights, brand Management process. Keen attention was focused on traditional 8-step process, including the development of
perspective provided by Metro’s suppliers individually.
aspirations and missions, and best practices. For the what shoppers would differently experience at the shelf. shopper initiatives and tactics around assortment, price
Building on this market knowledge, the shopper data
first time, multiple suppliers were asked to co-create was analyzed to learn how shoppers themselves and promotion, innovation, the role of private label in the
principles and actions intended to disrupt or discard defined category roles via their behavior. The resulting category, formats, channels and media, and to solve for
legacy approaches and find ways of working in favour analysis combined market, commercial and shopper seasonality.
of a data-led rationality of “doing different things and For the first time, multiple priorities to ensure that all category decisions would In the fourth phase, measures were set and resets were
expecting different results”. support business goals as well as grow shopper loyalty.
suppliers were asked to co- implemented in pilot stores. Results were analyzed and
Tools used in this collaborative Category reinvention In the second phase, advanced shopper science category plans were tweaked as necessary before full
model included:
create principles and actions rollout to all stores.
revealed a Shopper Decision Tree (example illustrated
∂ Advanced Shopper Science analytics, provided by intended to disrupt or discard below) to help Metro and supplier planners understand
dunnhumby legacy approaches and find
∂ Shelf Review, a proprietary tool that derives and
ways of working in favour of a
illustrates shopper decision trees and suggests
planogram facings and flow data-led rationality of “doing
∂ CRM algorithms to communicate changes to different things and expecting
shoppers via all channels
different results.”
∂ Market data from Nielsen

128 129
 RESULTS

Describe the brand resources assigned Describe the retailer resources assigned What were the key quantitative results What were the key qualitative results?
to the project. to the project. of the project?
Shopper satisfaction improved in all ‘reinvented’
The project objective of achieving an increase in sales categories and departments. New, easily identifiable
Brand team was asked to share their portfolio’s brand A special, dedicated project team was named, headed
growth for each overall department or category (vs sections were added to highlight local, premium,
building strategy and go-to-market strategy. This team by a Category Manager Director and including category
the growth rate average over the last 3 years) was organic, and ‘new innovations (NPD) choices that
typically comprised: managers in relevant dairy categories; pricing,
achieved. Dairy sales grew by 3.0% over prior period, delighted shoppers.
promotion and shelf management specialists; in-store
∂ Marketing Director or Sales Director,
merchandisers and market research and dunnhumby and frozen foods by +2.6%. Assortment was reduced Moreover, the supplier community provided testimonials
Key Customer Account Manager by 10% and 15% respectively, and adjacencies were
category management specialists. underlining their positive experiences and results with
• Market Research improved. the process. For example:
• Provide consumer insights and recommendation
kits ∂ “Process is clearly customer centric, Partner
approach – Open discussion, open to do major
∂ Shopper Marketing Manager A key step at the start was to
As a disruptive new approach,
changes. Congratulations!”. General Mills
• Co-create shopper marketing plans, share brand win the trust in the process
claim development and growth platforms the process required new ∂ “It’s super to see that decisions are purely based on
of ‘doing business as unusual’ data and not on emotional or pre-construct ideas.”
∂ Category / Brand Managers learning, resources and Danone
from both the supplier
• provide consumer and shopper - centric content to capabilities. It provided the ∂ “The overall process set Maverick approach as a best
the Category Plans. community and Metro’s own practice for retailer in Canada.” Pepsi
foundation for all Category
∂ Key Customer Account Managers category managers
Management Loyalty Marketing ∂ “We see this will be Metro’s new way of working.
• provide in-market coordination and support You were able to integrate and translate a lot of
going forward… information. Congratulations and thanks for sharing
the future planogram with us!” Agropur

130 131
KEY LEARNINGS Re-inventing Non-Alcoholic Beer
category consumer value drivers to
What were the major barriers faced What key advice would you offer to your transform the in-store experience
during the project? peers who are considering investing in using an innovative “Zero Zone”
Category Management?
∂ As a disruptive new approach, the process required
COMPANY BACKGROUND presentation concept
new learning, resources and capabilities. It provided ∂ All Category Management plans must be fully
the foundation for all Category Management Loyalty informed by shopper insights. It is important to
Marketing going forward, and the basis for reinventing develop a common Shopper (retailer’s Customer) This case study is submitted by:
six other departments of the store to date. Language and to teach it broadly to suppliers and Lauren Cussen
across the entire retail organization so that everyone
is fluent around which strategic segments of shoppers Title:
What would you do differently if starting Activations Manager
drive growth for the category and for the business.
the project again?
∂ Understanding the language of shopper segments Company Name:
Work more closely with the Brand Management and being clear on which segments are affecting / Heineken Ireland
function from the start to bring the consumer and most affected by category trends, brand strategies
shopper segmentation as the core for developing brand (supplier) and target shoppers (retailer) is essential Product Name & Relevant Category:
leadership and integrate it seamlessly into the go-to- information to have to develop category and shopper Heineken 0.0% - Non Alcoholic Beer
market strategy. plans that drive growth, create differentiation and
optimize operational costs. Location of Marketplaces:
∂ Focusing on the Shopper at the center of discussions Ireland
with suppliers allows a new form of “collaboration”
Store Format:
in a healthier and mutually beneficial way, and
enables a reinvention of the store experience that Supermarkets & Convenience Stores
creates excitement, differentiation, and growth. Cross
How many employees work in the relevant
category (add categories, etc)
marketplace?
>450 Zero Zone: A scalable category
How significant is your product within your approach to the No Alcohol beer
chosen product category?
Very Significant – Heineken 0.0% represents >56% of segment. Disrupting the category
Non-Alcoholic beer market in Ireland.
and bringing incremental growth
How advanced is Category Management within
your company? to the Heineken Ireland portfolio
Very Advanced – We have a dedicated team of Category
managers who work solely on Off trade in Heineken and wider NA category
Ireland. This team would analyse both local and global
market trends to shape our sell in story to support this
initiative, and share with all of our key retailers to bring
them on the Zero Zone journey with us. List the suppliers you worked with on
this project:
How many people work on the Category
Shop Equipment Limited – shop fitting company who
Management team that delivered this project? designed and installed our solutions
A number of different teams were involved including
commercial, brand, category, shopper marketing & field Konica Minolta – developed print solutions and graphics
sales for permanent installation

Reach Marketing – merchandising support to facilitate

merchandising after installs

132 133
PROJECT METHODOLOGY PROJECT IMPLEMENTATION

Briefly describe the project background/ List and give a brief overview of the main Describe the project framework and what Describe the supplier resources that were
challenge and the rationale that led the objectives of this project. tools you used. assigned to the project.
team to propose this project. ∂ Accelerate Heineken® 0.0% Brand and overall
category sales
To support implementation of the Zero Zones, we ∂ SEL Project Manager – key liaison for all unit
Following the massive success and launch of Heineken brought all our customers and internal stakeholders on requests, surveys and installation scheduling
0.0% brand into the Irish market in 2018, we saw that ∂ Develop a one stop solution which can house all the journey with us, from the ground up. We were in a ∂ KMMS Account Manager – liaison for all graphic
not only did this brand grow, but also grew other brands Non-Alcoholic brands, within any retail space strong position with Heineken 0.0% brand but had to sell requests
in the Non-alcohol category, giving us the perfect in the category opportunity, the growth opportunity of the
opportunity to cement our position as category leaders
∂ Provide an easily navigated solution for consumers
category, and the importance of providing a solution in
∂ SEL fitting teams – creation and installations of all
in Irish retailers, which disrupts the shopper journey units in stores
within NA. We noticed that shoppers were finding it store which would guide shoppers to the NA section.
difficult to navigate No alcohol within the alcohol aisle.
within the alcohol aisle ∂ Reach merchandisers – merchandised all units after
Prior to 2018, there was very little structure to NA
From this insight, we decided to develop a solution that ∂ Deliver all Zero Zone solutions sustainably
brands within the off license, and were often scattered
SEL installed
helped the category stand out in aisle. across the alcohol aisle, rather than being grouped
Zero Zone is the next generation to its Category What KPI’s (if any) were used to measure together. The Zero Zone has transformed the category Describe the retailer resources that were
creation. A Permanent Display Unit with a built in fridge. the project outcomes? and given it a whole new purpose. We have even seen assigned to the project.
It is an illuminated unit that captures the Heineken brand new products entering this newly created NA
The wider sell in, development & execution was
0.0% brand image and message, while still maintaining ∂ Market coverage % space, such as spirits and ciders, and expect to see
delivered by key members of the off trade team
neutrality for other brands to be shopped from the same even more as the category continues to grow.
unit.
∂ Sales value including Category, Field Sales, shopper marketing &
We were supported by all our retailers in installing commercial.
With learnings seen from Heineken Poland in 2018, we
∂ Sales volume
these units in stores, and also were supported by
saw 2019 as our year to take the Heineken trademarked ∂ Category growth our field sales teams, who upsold to their customers
ongoing, and still are. We developed a sell in tool which
Zero Zone™ and create our own versions specifically ∂ % market share
supported our field sales team as they sold this solution
for the Irish retail environment.
∂ Penetration in at store level.
The unit was imagined and brought to life through a
collaboration between SEL and Heineken Ireland, which ∂ Distribution
re-imagines shelving and display within the Grocery
Briefly describe the key steps taken to
environment.
complete the project.
This stand-out display visually disrupts the shopper’s
attention and offers multiple product buying options,
∂ Category analysis

regular or refrigerated. It is bold, captivating and unique ∂ Design proposal

to the Irish Grocery and Alcohol environment. ∂ Category & Customer sell in
∂ Store survey - measure & check for power, space etc.

Describe your target market for this ∂ Zero zone production

project. ∂ Zone implementation & planogram agreement
∂ Performance Analysis
The target demographic for NA beer is very broad, as
it appeals to a wide range of people. Male and female
aged 18 - 65.

With learnings seen from

Heineken Poland in 2018, we
saw 2019 as our year to take
the Heineken trademarked
Zero Zone™ and create our own
versions specifically for the Irish
retail environment.

134 135
RESULTS KEY LEARNINGS Using Category Management
principles to develop an integrated
What were the key results of the project? What were the major barriers faced
during the project? shopper solution for three
Each type of solution has delivered impressive results
for us to date, across shelf, FSDU and bay displays. All Zero Zone was certainly not a straightforward ‘one size
interrelated OTC categories
of which are measured off strong base sales. fits all’ rollout – very few 2 stores are the same and
COMPANY BACKGROUND
We have installed over 800 solutions to date across in order to successfully install, every store had to be
Ireland, with units in almost 50% coverage of the total surveyed and measured up to size before going into Company Name:
market. production. Space, power, planograms, height, width, RaiaDrogasil S.A.
depth and installation scheduling were all variables and
Heineken 0.0% has maintained over 55% share each store was a project within itself. Product Name & Relevant Category:
of NABLAB since August 2018, despite many new Pain Relief, Flu, Gastro
competitor products being introduced to the market this Zero Zone was always set to be a scalable category
year. approach, which meant from the beginning we were
Location of Marketplaces:
willing to support and provide permanent solutions to
São Paulo, Brazil.
any NA section of any size, whether that be a single
shelf, a double bay with fridge, or an 8 metre long Store Format:
Wholesale bay! We offer this scalable approach as we
With learnings seen from Raia Drogasil SA is a seller of medications, specialty
have an ambitious footprint we want to achieve both this
medicines, perfumery, personal care and beauty
Zero Zone was certainly not a year and next year, so it’s important we can adapt our products, cosmetics and dermocosmetics. The
straightforward ‘one size fits solutions to work within every retail space. Company operates 2000+ stores branded as Droga
Raia, Drogasil, and 4Bio, located in 24 Brazilian states.
all’ rollout – very few 2 stores
are the same and in order What would you do differently if starting Annual Local Market Sales:
the project again?
to successfully install, every > €1 Billion
store had to be surveyed and We would have begun the sell in story sooner, and How many employees work in the relevant
measured up to size before placed focus on getting traction in the market with our
marketplace?
shelf solutions as the bay installations take much longer
going into production. to implement!
32,000

In your local market, how significant are you

What key advice would you offer to your within your chosen category?
peers who are considering investing in Very Significant.
Category Management? How advanced is Category Management within
your company?
∂ Permanent solutions are key, and should be invested
Advanced
in if possible to protect and future proof categories

∂ If your brand or product is market leader, now is the Number of people employed in Category
time to act to create a shopper centric solution which Management team in your Company?
you can own in stores 6 people – within RD Cataman Team, DH and CPG
partner

List the retailers you worked with on this project?

Raia Drogasil, internal

136 137
PROJECT METHODOLOGY PROJECT IMPLEMENTATION

Briefly describe the project background/ Describe your target market for this Describe the project framework and and audience (adults vs. kids). With a display of the
challenge and the rationale that led the project. what tools you used. products more aligned to retail pharmacy shopping
missions, shoppers were able to more easily compare
team to propose this project.
A segment of Loyal shoppers was identified who drove ∂ Understand buying
Usingbehavior for OTC
customer data(Over
andtheinsight to understand
the price/value of the different
shopper sizes and
behaviour and pick the
Product assortment and display of Over the Counter the majority of sales, but who also had significant Counter) products product
improve OTC (Over the Counter) category performance most appropriate to their need (immediate use
(OTC) categories has been a major issue for headroom in these categories that were identified as ∂ Analyze category performance, looking at different vs. stock up).
Product assortment and display of Over the Counter (OTC) categories has been a major issue for most pharma retailers and
most pharma retailers and CPGs, due to a lack of strategic for ‘core’ and ‘growth’ according to the shopper product typesCPGs,
and due
characteristics such as active
to the lack of understanding of their customer data. For Raia Drogasil (RD), leader of the Brazilian drugstore market,
understanding of their shopper data. For Raia Drogasil data science. ingredients, name, packaging
it was essential to startand audience
driving value from their customer data to make better informed assortment decisions to maintain their
Describe the brand resources assigned
(RD), leader of the Brazilian drugstore market, it was ∂ competitive advantage.
Use insight from data to apply a shopper-centric to the project.
essential to start driving value from their shopper data approach to category assortment and shelf plans
to make better informed assortment decisions toward
List and give a brief overview of the main
maintaining their competitive advantage. objectives of this project. ∂ Challenge
Create an intuitive flow of products within the GSK supported RD with future insight for category
categories forRD
different shopper segments future and building planograms, creating training
had large volumes of customer data but was failing to extract value from it in terms of knowing their customers better, and
RD had large volumes of shopper data but was failing ∂ Apply category management principles to develop ∂ Optimize category
driving assortment
better business and With focus on four categories:material
category
decisions. Pain Relief,and instore
Flu, Gastro andimplementation
Health Appliances, RDand tracking.
partnered with
to extract value from it in terms of knowing their a new integrated shopper solution for a number of dunnhumby
attribution based to begin their
on shopper customer knowledge and category management journey for OTCs.
behavior
customers better, and driving better business decisions. interrelated use categories
Tools used in this analysis
The under evaluation were very broad, but were Describe
included:
four categories the
related to each other. Theretailer
challenge wasresources
to identify the trueassigned
correlation
RD partnered with dunnhumby to begin their shopper ∂ Use shopper data to substantiate the connection
dunnhumby’s Shelf andalso includedto the project.
and substitutability, evaluate previous assortment decisions and take actions to optimise product display and flow going forward,
knowledge and category management journey for OTCs. between categories basedReview toolbehaviour.
on customer was used tothe
Part of mapanalysis looking at category performance through analysis of different product
understand purchase behavior, andsuch
to identify any
The three categories under evaluation - Pain Relief, ∂ Define the assortment, and then to place these types and characteristics as active ingredients,
correlations between products in the macro categories
name, packaging and audience.
RD Catman team used dunnhumby’s Shop & Shelf
Flu, and Gastro - were very broad but related to each products in a flow that made sense to shoppers Review tools to refine insights to change OTC
(Pain Relief, Flu, Gastro).
other. The challenge was to identify the true correlation exposition
Solution ‘Shelf review’ was used to map
and substitutability, evaluate previous assortment The data science innovation was in defining category
decisions and take actions to optimize product display What KPI’s (if any) were used to measure By combining customer knowledge capabilities, science and
roles and levers according to shopper behaviors, a decision tree and identify
tools, dunnhumby could deliver a compelling solution to support
and flow going forward, based on shopper behavior. the project outcomes? as well as linking both the commercial and shopper
assortment decision-making for OTC products, based on
product correlations
Part of the analysis also included looking at category priorities. For example,
actionablethe science
insight obtainedexamined
from RD’s customer data.
performance through analysis of different product types The success of the project would be judged on achieving behavioral engagement (frequency & penetration),
and characteristics such as active ingredients, pack size, an increase in the sales and unit growth for each category importance to shopper’s
Shelf Review was used tochoice
map andofunderstand
retailer, purchase
and
name, strength and audience. category (vs the growth rate average over the last 3 emotional and cognitive engagement
behaviour, and to identify any(thinking
correlations& feeling
between products
years). about a category).in the macro categories (Pain Relief, Flu, Gastro and Health
Keen attention was focused on what
Shoppers come into these categories in a different Appliances). A decision tree was mapped providing the
Sales growth would also be reflected by improvements shoppers would necessary
experience differently at the shelf.
mindset in drug v grocery – and with a different kind input to redefine the assortment and display of
of shopping mission. Their needs may be acute, in shopper loyalty, I.e., growing the number of new Loyal various brands, seeking to improve category performance and
shoppers engaging in the department or category, or by increase category sales.
seasonal, and continuous use with different products in Briefly describe the key steps taken to
the categories serving each of these needs. Based on incremental spending by shoppers already ‘loyal’ to the
complete theThe project.
solution also included building a shelf planogram with
these different needs; the project asked “is there an ideal category.
intuitive product navigation, based on observed correlations
product set and way to visually merchandise that will be In the first step, between
shopper dataingredients
product science (specific
helpedvs.RD clearly
broad spectrum – i.e.
more intuitive to the customers, improve their shopping define a group ofheadache
categories that
vs. broad had
pain complementarity
killers), name (generic vs. branded),
experience and boost performance”? packaging (boxes vs. blisters) and audience (adults vs. kids).
and clear connections according to shopper behaviors.
These categories could be built together in a conjoined
With a display of the products more aligned to retail pharmacy
category strategy and total solution to reinvent and grow
shopping missions, customers were able to more easily
the contribution compare
of thesethecategories.
For Raia Drogasil (RD), leader of price/value of the different sizes and pick the
product most appropriate to their need (immediate use vs.
In the second step, advanced shopper science mapped
the Brazilian drugstore market, stock up).
a decision tree, which provided the necessary input to
it was essential to start driving redefine the assortment and display of various brands,
seeking to improve category performance and increase
value from their shopper data to
category sales. Correlation / complementarity and
make better informed assortment substitutability are leading-edge using shopper data to
decisions toward maintaining link how consumers think and act.
The third step built a shelf planogram with intuitive
their competitive advantage.
product navigation, based on observed correlations
between product ingredients (specific vs. broad © 2019 dunnhumby / All rights reserved

spectrum – i.e. headache vs. broad pain killers), name

(generic vs. branded), packaging (boxes vs. blisters)

138 139
 Integrating the consumer demand
RESULTS
spaces (consumption occasions)
What were the key quantitative results What were the key qualitative results? into the consumer-shopper journey
of the project? in-store experience in the Alcohol-
“We were able to move to a customer-centric category
COMPANY BACKGROUND Free Beverages category
∂ Informed and customer-centric decision making for management. We used to look at sales information
category assortment and product flow only, now we look at customer data to decide new
strategies for the category. For me, that is the biggest
∂ Better in-store customer experience supported by
transformation that we have achieved so far.” - Marcello
This case study is submitted by:
intuitive category navigation, easy-to-shop & easy-to- Katia Troupaki
De Zagottis, VP Commercial & Marketing
find exhibition, and clear communication on shelf
Title:
∂ Product repositioning based on packaging (boxes/
Category Manager
blister), encouraging easier price/value comparison
of pack sizes and need specific purchases for each We were able to move to a Company Name:
mission
customer-centric category Coca-Cola HBC Greece S.A.I.C.
∂ Easier shelf replenishment due to better
management. We used to look at Product Name & Relevant Category:
communication, layout and fixture
sales information only, now we ∂ Sparkling Soft Drinks ∂ Juices
∂ All of this delivered 4.3% sales uplift, 1.5% growth in
∂ RTD Tea ∂ Water
sales, and 2.2% increase in units due to packaging look at customer data to decide
repositioning ∂ Energy ∂ Sports Drinks
new strategies for the category.
Location of Marketplaces:
Athens, Greece

Store Format:
KEY LEARNINGS
Large

What were the major barriers faced What would you do differently if starting Annual Local Market Sales:
€221M AFBs (Alcohol Free Beverages) GSR in
during the project? the project again?
Organised Trade
∂ Overcoming the myth that pack sizes should be The operations teams should be involved at the very
How many employees work in the relevant
grouped together first vs brand, as the assumption beginning of the process so that they are fully bought in marketplace?
was that the shopper would trade down to the and are prepared to execute with confidence.
1800
cheapest option. The shopper data revealed that
brand was higher in the shopper decision hierarchy How significant is your product within your
than RD planners had believed. What key advice would you offer to your
chosen product category?
peers who are considering investing in
∂ Ensuring that the right conditions were in place to be
Category Management?
Our products are very significant for AFBs category as
able to measure the impacts accurately. A statistically their Contribution in TTL Gr AFBs sell-out exceeds 42%.
role on this project as they bared the responsibility of
informed initial test-and-control group and impact the store activation. The Key Account Manager was
Be prepared to fundamentally change your thinking How advanced is Category Management within
measurement approach were essential for definitive, also involved in the store activation. Furthermore, he
around categories and be open to the fact that your company?
repeatable results. proceeded with negotiating the listing of new launches.
resources and investment will need to be prioritized
Category Management is very advanced in our company. The local Sales team assisted the store personnel
according to what is most important to your shoppers. It Coca Cola HBC has a dedicated team behind Category with the implementation of the new planograms taking
is through that perspective that you will create a better Management. Each Category Planner specializes over the part of the shelves that was occupied by our
shopper experience, generate loyalty, and win superior in specific product categories/Sub-Trade Channels. products. Furthermore, the team collaborated with
long-term performance. Furthermore, the responsibility for Key Customers is split several Marketing teams (Brand, Shopper, TCCC) in
amongst Category Planners. the process. Overall, more than 30 employees were
involved in the project, all of them based in Athens.
How many people work on the Category
Management team that delivered this project? List the retailers or suppliers you worked with on
We created a Cross-Functional team for this project this project (list in order of involvement where
including people from Commercial Excellence, Marketing possible):
and Sales Functions. ∂ My Market [Retail Partner]
The team was led by the Category Management team. ∂ Sprint Advertising Agency [Supplier]
Customer Marketing team also played an important ∂ MVP Sign (Polycretis) [Supplier]

140 141
PROJECT METHODOLOGY PROJECT IMPLEMENTATION

Briefly describe the project background/ List and give a brief overview of the main Describe the project framework and what well as understand the performance of our portfolio
challenge and the rationale that led the objectives of this project. tools you used. and explore key areas and opportunities. Processing
CBL as a basis, we defined on which strategic
team to propose this project.
The objective of this Joint Value Creation project is to Our Category Vision was based on Consumer Beverage occasions to focus on & how to tackle them, through
Customer Centricity & Joint Value Creation is a strategic increase the overall growth of the beverage category, by Landscape research which set the framework for the our Category Vision strategy.
priority we have further focused on within the last making it more attractive and driving impulse purchase.
Our vision behind this initiative is to give life to our
key Occasions/Drinking Moments that represent the
highest Size of Prize, as an opportunity for future
∂ IRI Scanning Sell-out data
years, as retail industry is becoming more and more
competitive. Fruitful relationships with our customers Category Vision in-store. Being a 24/7 Total Beverage category growth and outlines our strategic choices on ∂ Homepanel metrics (eg. Penetration, Frequency,
Company, we can provide consumers the right products how to best capture that growth. Furthermore, by using Volume per trip, Basket Incidence)
can optimize the outcome for the market & the
categories; thus, we wanted to take advantage of this in for every Consumption Occasion around the clock. market & consumer insights as well as our Occasion- ∂ Consumer Decision Tree (derived from Shopper
favor of both parts and create a win-win situation. Through this project we link each product category Based Management strategy, we took advantage of our Study CCH2017)
with the respective consumption occasion based on know-how in favor of both sides of the partnership.
proper communication and focusing behind the relevant ∂ Trade marketing activities for brand & store activation
Describe your target market for this As tools we have used the following to help us
categories & occasions for the channel.
implement the project: ∂ Cooler with high tech front display on door,
project. communicating various messages

What KPI’s were used to measure the

∂ CBL (Consumer Beverage Landscape), which is
∂ Slot machine, as an interaction point with end-
This project is targeting all AFBs consumers. a Consumer Behaviour Study run by The Coca
project outcomes? customer, adding value with promo offers
Cola Company, mapping and deep diving into

The following KPIs were used to measure the project

consumption occasions of total beverages. It is a ∂ Spaceman (Nielsen) program to create planograms
tool that helped us identify the evolution in consumer
outcomes in AFBs comparing data from the Pilot store drinking behaviour in Greece in the last 10 years, as
and one Control store (of approximately the same
Being a 24/7 Total Beverage calibre).

Company, we can provide ∂ Transactions

consumers the right products ∂ Volume

for every Consumption ∂ Value

Occasion around the clock. ∂ Single serve mix contribution

∂ Lights contribution

Briefly describe the key steps taken to based on their scope & limitations, so that we
complete the project. conclude to a final proposal.

∂ Started working on the pilot store of this project

∂ Run the Consumer Beverage Landscape research in together with the customer in order to create an
collaboration with The Coca Cola Company experiential, innovative environment.
∂ Set the framework for the key Occasions/Drinking
∂ Throughout the implementation period, we
Moments that represent the highest Size of Prize. collaborated closely with the customer to overcome
∂ Contacted an external agency to give us creative any barriers.
ideas for the implementation, based on the drinking
occasions we concluded.
∂ Exchanged data with the customer in order to
perform the evaluation of the project, after a certain
∂ Communicated all the insights we had to the period.
customer, as well as our proposal and got feedback

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 RESULTS

Describe the brand resources that were Describe the retailer resources that were What were the key quantitative results of
assigned to the project. assigned to the project. the project?

The teams that were involved in this project were: ∂ Customer’s Marketing team, approving visuals and
BW SSDs Growth Rate vs Control Store vs Customer Trend vs SM Trend
constructions
∂ Category Development team, led the project based
on Beverage Category Vision, building planograms ∂ Buyer of the relevant categories (Sparkling Soft
based on market trends and market shares and Drinks (SSDs) & Juices)
showing clear segmentations (brand/ sub-flavours)
for the whole category in vertical blocks.
∂ Technicians/ electricians for the store, that helped in
the technical part of the implementation, as the store
∂ Trade Customer Marketing briefed the agencies had specific restrictions.
regarding the concept and implementation in
collaboration with Category and implemented the
∂ Store Manager (oversaw the implementation of
several steps) and employees (assisted in the final
store activation.
set up of the Beverages aisle).
∂ Key Account Manager was involved in the store
activation. Furthermore, he proceeded with SSDs Excl Mixers vs LY vs Control Store vsTTL SM 2019 vsMyMarket 2019
negotiating the listing of new launches. TTL SSDs Transactions +5.4% +0.7PP +4.4PP +1.7PP

∂ Sales team assisted the store personnel in

Trade Customer Marketing TTL SSDs Value +6.9% +1.2PP +3.2PP +2.6PP
implementing the final set up in the Beverages aisle,
according to the planograms. Namely, they took briefed the agencies
The performance of SSDs is improved both in terms of Flavors (ttl Flavors losing value vsLY). Furthermore,
over the part of the shelf that was occupied by our
regarding the concept and Transactions and Value vs LY with a rate better than this Lemon Limes show a remarkable growth vs Control
products.
implementation in collaboration of the Control Store, the trend of My Market and TTL SM. Store. Last but not least, Lights Contribution in Colas is
∂ Shopper & Brand Marketing, as well as The Coca
Deep diving in SSDs Category, all subcategories are
significantly improved vsLY and vsControl store.
Cola Company, helped trade marketing with non- with Category and implemented
growing both in Value and Transactions except for
branded visuals for the activation of the relevant the store activation.
category.
BW Juices Growth Rate vs Control Store vs Customer Trend vs SM Trend

Ambient Juices vs LY vs Control Store vsTTL SM 2019 vsMyMarket 2019

TTL Juices Transactions +7.7% +7.4PP +9.5PP +4.8PP
TTL Juices Value +10.9% +13.6PP +16.6PP +14.6PP

The BW project benefited greatly the Ambient Juices

Category. Even though the respective Value trends are
negative, Ambient Juices in BW showed an impressive,
double-digit performance. Furthermore, the Value of the
category is growing faster than Transactions.

*Beverage World and Control store Data regard the period of

activation (March-December 2019), while TTL SM Trend and My
Market Trend are data extracted from IRI for 2019.

144 145
What were the key qualitative results of Customers now tend to visit the Beverage isle more The key consumption occasions were captivated
the project? often and stay longer than before. Consequently, they through tailor-made constructions, making the shopper’s
are exposed to the full extent of the Category’s portfolio, decision easier and enhancing the overall shopping
The execution of “Beverage World” helped the Alcohol- often choosing products that are not among the top experience.
Free Beverages Category stand out in the store. It selling. This change showed more innovative products
Last but not least, through joint value creation we
should also be noted that the reforming of the category up. Furthermore, it enhanced the circulation of products
strengthened our relationship with the retailer.
redirected the interest of the customers from the of the category that are considered premium, leading
secondary placements to the permanent position of the the affected categories to a “trade up”.
category.

PHOTOS BEFORE

PHOTOS AFTER

146 147
KEY LEARNINGS
Rejuvenating the Pasta Category
What were the major barriers faced What key advice would you offer to your and shopping experience across retail
during the project? peers who are considering investing in
Category Management? stores in three different countries
∂ Implementation had to take place while store was
COMPANY BACKGROUND
open and the shelf had to be functional I would advise them to:
∂ There were some restrictions that had to be taken ∂ Picking the right Partner is a key to success for
This case study is submitted by:
into consideration for the constructions (ie regarding Projects of this scale.
lighting) Paolo Zazzi
∂ Have various alternatives beforehand.
∂ Maintenance of the machines (ie slot machine
∂ Build a detailed timetable with realistic slots, taking
Title:
frequently updated with new mechanisms or feed Customer & Shopper Marketing Group Director
into consideration the technical part that may need
with paper for the coupons)
more time.
Company Name:
∂ Adjusting the planograms to the new innovative
∂ Have enough budget on hand, as in most cases
scenery Barilla G. & R. Fratelli
extra costs occur during the project, especially when
innovation is of strategic priority. Countries where the project has be
implemented:
What would you do differently if starting ∂ Always have in mind that the only successful and
Italy, France, United Arab Emirates
sustainable project would be the one that creates a
the project again? win-win situation.
Product Name & Relevant Category:
We would have a strict, more detailed timeline, Pasta Meal Category
having in mind beforehand what is easy and not to be Include any links that lead to more (Pasta + Ready To Use Sauces)
implemented and, therefore, have more alternatives for information about the company, project,
the customer to choose. Location of Marketplaces:
website etc
Italy, France, United Arab Emirates (UAE)
CCHBC:
Store Formats:
https://gr.coca-colahellenic.com/en/
Hypermarkets & Supermarkets
Customer:

“
MyMarket https://www.mymarket.gr/home.aspx Annual Local Market Sales (EUR):
Italy: 500M - 1BN
France: Pasta: 500M-1BN, Sauces: 200M–500M Based on new shopper
UAE: < 10 Million
insights and real consumers’
How many employees work in the relevant
behaviour up-todate
marketplace?
Italy: 600 employees observation, we stated
France: 50 employees
some important principles
UAE: 10 employees
to be followed when
How significant is your product within your
chosen product category? approaching the category.
Extremely Significant

How advanced is Category Management

within your company?
List the retailers or suppliers you worked with on
Advanced
this project:
How many people work on the Category Carrefour Italy
Management team that delivered this project? Carrefour France
More than 10 in Italy; more than 10 in France; 2 in UAE Carrefour UAE

148 149
PROJECT METHODOLOGY

Briefly describe the project background/ ∂ Inspiring people is crucial to convert shoppers Describe your target market for this
challenge and the rationale that led the into buyers. We need to connect the pre-store project.
activities with the in-store touch points.
team to propose this project.
In accordance with the shopper insights we designed a The Carrefour shoppers are our targets. Due to the high
Over the last few years new needs about Health & Category Management approach leading to a complete coverage of Carrefour store network in the selected
Wellbeing (Better For You) and Premiumness are rethinking of the Pasta Meal category. Countries they are also representative of the pasta meal
spreading in Western Countries and marking food target and vice versa.
Then, based on the local market environment (category
categories growth. Amongst these consumers the food & beverage choices
development, competitiveness, consumer expectations
These type of trends were not yet matched with an …) we have tuned our project work and differentiated by of BETTER FOR YOU people segments value 58% of
total Italian Food & beverage and when talking about

Italy pasta meal

offer on shelf which can inspire shoppers. The above Country:
shopper expectations are also directed towards the pasta they reach almost 60%.
Pasta Meal category, composed by Dry Semolina Pasta ∂ In Italy we have been working first on dry pasta
Italian segmentation based on people behaviour is the

solution.png
assortment re-designing, shelf layout optimization,
category and Ready to Use Sauce category. one more advanced in reflecting trend on wellbeing
synergy of promo and communication plan. At
Barilla has been working side by side with Carrefour the same time we have also upgraded the quality and premiumness, France is following and, based on
France on Category Management since several years. of our regular cuts range and introduced a new previous years experience, UAE trends are replying
We are Pasta Category Captain in UAE and have Barilla 100% made with Italian durum wheat with closely to European Countries trends.
agreed to work with Carrefour Italy as well to make the an improved product design. Therefore, we aimed at better reflecting inside the stores
category greater again. the real way different Pasta shoppers live the category: Italy: pasta meal solution with the new
∂ In UAE the focus has been on dry pasta category
our recommendation will be to address different shopper Italian range of upgraded regular cuts
In order to react and provide our retail partner effective and was brought about through the development
targets by having a deeper assortment offer and a clear 100% Italian durum wheat
solutions insights based we have launched: ad hoc of a new segmentation, range rationalization
studies, Nielsen data assessments and Carrefour and branding approach to enliven the retail communication of product characteristics via a new
shopper surveys (EMNOS in France) about consumption environment. planogram design and ad hoc signages.
drivers and the consumer & shopper journey.
∂ In France after reorganizing the pasta approach
Based on new shopper insights and real consumers’ on merchandising with the emergence of new
behaviour up-to-date observation, we stated some
important principles to be followed when approaching
the category:
needs as Premium and Better for you Pasta, we
worked together on the sauces category to bring Shopper segments behaviors.png
Shopper Segments Behaviors And Purchasing Choices (Italy)

more attractiveness and more readability on the

sauces’ shelf
∂ Penetration is the main sales driver of the pasta
category. Category or brand penetration does
not last forever but has to be constantly nurtured.
It means that recruiting shoppers is the key for
success

CATEGORY PROJECT PERSPECTIVE BY COUNTRY

ITALY UAE FRANCE

Source: Nielsen Italy 2017
Category importance for retailer 2,3%* O,5%* 0.7%**
(% on FOOD & BEVERAGE) (15 in rank FOOD (38 in rank FOOD &
& BEVERAGE) BEVERAGE)

Category for consumers 97,5%* 77%* 66,8%**

(Household penetration)

Mental availability Physical availability Penetration is the main sales driver of the pasta category.
Project focus Physical availability
(Re-align dry pasta offer to (Re-align dry pasta offer (focus on sauce Category or brand penetration is not given forever, but
people expectations) to people expectations) visibility) has to be constantly nurtured.

*dry pasta category, ** sauce category

150 151
 PROJECT IMPLEMENTATION

List and give a brief overview of the What KPI’s (if any) were used to Describe the project framework and B ∂Customer plan identifying the category growth
what tools you used. potential and highlighting the retail mix guidelines
main objectives of this project. measure the project outcomes? for the joint business planning.
Reverse category negative trend and obtain opportunity The main KPI’s used to measure the outcomes of We have been working within a framework integrating C ∂Integration in a picture of success which defines
for growth within the category by activating different project are the following: category assessment and customer plan into a joint how to restore growth driving penetration on:
levers. category management plan devoted to restore category
∂ Category total sell-out in Carrefour compared to growth: ∂ Product portfolio performance
∂ Enhance the shopping experience of the target (Italy)
A ∂Category assessment starting from a ∂ Shelf readability
category considering the decision tree via better
segmentation & planogram to reduce the amount
∂ Category Value Growth in Carrefour, compared category vision and followed by an accurate ∂ Promo management
with total market data (UAE) or Carrefour control survey on market data to identify a new category
of time spent looking for products
benchmark (France) segmentation based on people behaviour
∂ Match the different target shopper expectations for
∂ Growth of individual segments within the category
the whole product category
(UAE) or their penetration versus target (Italy and
BARILLA UNIT CONTRIBUTIONS TO FUEL THE PROJECT FRAMEWORK
∂ Drive traffic into pasta isle & increase conversion France)
(Italy and UAE) UNIT TOOL ITALY FRANCE UAE
∂ Trade margin evolution (Italy)
∂ Reverse category trend in Italy by launching the Market Research
new upgraded range of Barilla regular cuts 100% Category trends & Growth drivers
Italian durum wheat Consumer and Shopper Insights

∂ Drive traffic and increase penetration on sauces Customer Marketing

category (France) Assortment optimization

∂ Test a POS material to support the identification of Planogram

the segmentation (France) Conceptual design

∂ Inspire & trade-up consumption CARREFOUR Limay (France): Trade Marketing

Pasta Sauce displayed close to POS material development
Dry Pasta Customer Planning
KPI’s Definition

Briefly describe the key steps taken to ∂ Theatralize the category lane with POP materials
complete the project. such as crowners on top of shelf, with messages
to highlight products in each segment and clarify
∂ Launch shopper research for a deeper readability for the shoppers (all).
understanding of the pasta consumer behaviour
(Italy and UAE) and of the sauces’ barriers to ∂ Offer shoppers a complete meal experience:
move sauces into the middle of the pasta category
purchase (France)
(Italy), place sauces in front of pasta for cross
∂ Revisit the assortment/range rationalization and merchandising (UAE)
adapt by segment, by store format and by Nielsen
area (Italy and UAE) ∂ Tailor promotion plan in accordance with the new
view of the category (Italy and UAE)
∂ Update the category planogram according to
∂ Develop Communication plan ad-hoc for
the shopper view by introducing high value and
Carrefour’s shopper (Italy and UAE)*
trending items at the beginning of the category (all)

∂ Differentiate the category offer to satisfy different ∂ Implement the concept in a group of store test
(UAE: 10 Hypermarkets, France 8 Hypermarkets)
shopper targets through:
∂ design product merchandising on shelf by target ∂ Evaluate KPIs
segment (Italy and UAE) ∂ France: Deploy on all Carrefour network
Hypermarkets (230 stores)
∂ communicate product benefits with shelf talkers
and headers addressing different expectations of
different target shoppers (UAE)

152 153
*In order to further explode our reach to target shoppers Describe the brand resources that were
both in physical stores and online and create an omni- drive to store and assigned to the project.
channel experience, an ad-hoc communication plan for e-commerce
Carrefour’s shopper was developed. TO INCREASE SALES Dedicated inter-functional teams have been enrolled in
With the aim of offering a consistent shopping experience order to manage and monitor the project. Local team
and exploit category full potential, several touchpoints leaders have been appointed and each function had to
were activated to communicate directly to targeted carry out tasks as it follows:
shoppers through push notification via mobile. Through
an ad-hoc plan based on geolocation shoppers were
informed about what was going-on both in physical
BRAND RESOURCES AND RELEVANT TASKS
stores and on the retailer’s online homepage. We were UNIT TASK ITALY FRANCE UAE
able to communicate successfully various initiatives
Customer Team
such as promotions, special initiatives and instant win
contests. Translate category assessments into
a growth plan at key account level
Provide in-market coordination and support
PASTA MEAL PLANOGRAM SCHEME (ITALY)
Organize the sales team to implement
the project in different POS
Develop and share with the customer new
promotion plan according to project framework
Marketing Manager
Develop ad-hoc communication plan
Trade Marketing Manager
Develop shopper marketing plans and
brand claim for in store communication
Manage the insights development with
market research specialists
Develop conceptual design & POS material
CARREFOUR Italy: Pasta Meal Planogram design.
Category Manager
Create new planogram for category segmentation
CATEGORY SEGMENTS DIFFERENTIATION Provide shoppers’ insights through retailers’
COUNTRY CATEGORY PRODUCT SEGMENT SHOPPER TARGET GROWTH DRIVER IN STORE MESSAGES fidelity card database
Coordinate and jointly analyse the test
Italy, UAE Wellbeing products better for you Grow category Wholesome and
(whole wheat, special shoppers penetration. healthy Finance Manager
grain, organic, …) Grow basket value.
Monitor and evaluate trade margin evolution
Grow trade
profitability. Monitor implementation costs

Italy Regional products traditional Grow purchasing

(local cuts, special grains) shoppers frequency

Italy, UAE Premium products upscale shoppers Grow basket value Chef’s choice
(higher price, high quality) Grow trade Specialty products
profitability

Italy, UAE Regular products mainstream Grow purchasing Cook it every day
shoppers frequency

154 155
RESULTS

What were the key quantitative results CARREFOUR Lomme (France):

of the project? Identification of the different Sauce segments was
improved placing Pesto segment between the red
Positive results both in the pilot phase and in the roll sauces with meat and the red sauces without meat.
out:
As pesto segment’s main colour is green, it created
a visual break on red sauces shelf and helped the
shopper.
QUANTATIVE RESULTS

PHASE ITALY FRANCE UAE

Installation Positive performance +6,4% hypermarkets

against control leg across test (8) vs benchmarked
all Pasta Category Carrefour hypermarkets
segments

Roll out +1,3% Sauce Category +4% Pasta Category

Growth Baseline in Value in Growth in Value vs a declining
Carrefour Hyp. vs. a declining mkt in the UAE (-1%)
category (-3,7%) * +10% Pasta Sauces
Category vs PY**

* Nielsen Sell-out data P1-P5 2018 vs n-1 vs. P9-P13 2018 vs n-1
**Carrefour Sell-out data 2019 vs. 2018 & Nielsen Data Dec 2019

What were the key qualitative results of In UAE it also created a more interactive and pleasant
the project? environment with the revamped shelves; the branding
communicates key messages and inspires via the
The product assortment redesign led to building a gastronomic appeal of portrayed dishes.
greater shelf productivity and clarity for the pasta Other retailers in the countries have shown interest
segmentation both in Italy and France. in applying the same concepts being inspired by the CARREFOUR Thiene (Italy):
In each of the 3 Countries it significantly reduced Category Management project and results.
BEFORE and AFTER the category re-design starting
the time spent by shoppers in front of the shelf and from the Better For You Pasta Segment to address the
facilitated shoppers in their choices. needs of the 3 main Italian shoppers segments

CARREFOUR UAE: CARREFOUR UAE:

Shelf dividers Cross
with QR code merchandising
target Better For hanging Sauce jars
You shoppers on pasta shelf.
giving info about
displayed Pasta
and Sauce.

156 157
KEY LEARNINGS

What were the major barriers faced What key advice would you offer to your
during the project? peers who are considering investing in
Category Management?
Positive results both in the pilot phase and in the roll
out: 1. Start from a solid background:
∂ between internal Brand Marketing services and • It has been crucial to kick off the process of
Retailer Marketing services. category management review with the in-depth
study of the shopper behaviours based on real
∂ among the huge number of functions involved on
purchasing data
both sides (manufacturer and retailer)
2. Communicate the changes:
∂ in maintaining the concept alive in the store; i.e.
• Very beneficial it has been to accompany the
adapting the concept with new brands/innovations
Category Management project with strong
coming through the time, to keep the same
communication in store and education tools that
objectives of the Category Management project
consumers can interact with as consumers are
∂ among store formats and Nielsen area and adapt constantly looking for novelty and inspiration.
the new assortments
3. Go to scale:
• find a clear and easy to up-scale project
What would you do differently if starting 4. Be flexible …
the project again? • by addressing all the shopper targets
The increase of the product portfolio performance • by re-challenging and adapting the category
resulted in item rationalization, difficult to be quickly strategy to the new market and consumer trends
implemented. • by keeping studies up to date
adapting on customer constraints
Finding smart solutions in managing the cut off items
from the new assortment would have given a quicker
boost to the project start. Include any links that lead to more
information about the company, project,
website etc.

www.barilla.com
www.carrefour.it

CARREFOUR Burolo (Italy):

BEFORE and AFTER the category re-design exploiting the presence of the
Pasta Premium Segment

158 159
 Blending global led innovation with PROJECT METHODOLOGY
local consumer and shopper insights
into a new consumption occasion Briefly describe the project background/ List and give a brief overview of the main
challenge and the rationale that led the objectives of this project.
based category vision for a successful
team to propose this project. The focus of category collaboration efforts with our
COMPANY BACKGROUND Rice Category Business Plan partner My Market had the following objectives
Rice category in Greece has a penetration of 92% with
Greek consumers eating 1M meals of Rice every day. ∂ Build Rice in 2’ segment within Rice category in
Company Name: In the last years category is flat or negative while it is a sustainable way in order to come on top of TTL
Mars Hellas (Uncle Bens) heavily commoditized due to the promo activities and consumption and unlock new consumption moments
not any major “innovations” in the market. Uncle Bens
Product Name & Relevant Category: brand is present in Greek market since 1956 but still
∂ develop and implement shopper marketing plans to
offer meal solutions that would generate trial of more
Rice Category Value share is less than 15% since we don’t compete healthy eating
in the Local White segment which is around 40% of
Location of Marketplaces:
the market. The challenge for Mars was to increase its ∂ Help our Partner My Market to gain share in RICE
Greece share but in a way that could enhance total category category

Annual Local Market Sales:

growth. ∂ Help our Partner customer to get out of the vicious
In today’s world, eating well is a constant challenge. cycle of a commoditized category and premiumize
€100Million
Mars vision for the category is to offer more healthy the segment of RICE
Local Employee Numbers:? meals and help consumers hit the “sweet point” of ∂ Use an innovative packaging that can promote new
95 healthier, tastier, easier and affordable meals. Based on consumption moments of RICE which can be also
the aforementioned, in 2017 we launched exclusively out of home
In your local market, how significant are you 5 new SKUs under the segment Rice in 2’ (Ready to
within your chosen category? Heat) in our strategic partner, My Market. This segment ∂ Make segment to have a critical size in order to be
Significant. realistic for the retailers to further support it and then
can promote new occasions of consumptions, enable
further expand it across all Greek market
consumers prepare more healthy meals with less
How advanced is category management within
cooking time, offer good value for money and at the
your company? (1 to 5 scale, where 5 is very
same time bring new users to the category. Moreover, What KPI’s were used to measure the
advanced)?
this proposition can offer to the Greek retail environment project outcomes?
4
significant premiumization for the category and help
Mars focus on Category management is significant. total RICE to have a sustainable and profitable growth The project success would be measured around the
Globally, we have conducted researches which show in the years to come, delivering Incremental Value. following KPIs
that 70% of Mars growth stems from Category growth
and only 30% from share gains. We are very much Shelf space: Since it was a new segment within rice,
focused behind strategic subsegments within our Describe your target market for this the challenge was to gain from zero the respective shelf
categories that can promote new consumption moments Mars focus on Category project. share within category, building a brand block of at least
and drive premiumization and we always strive to bring 5 skus. In collaboration with the retailer, we structured
meaningful innovation in the market.
management is significant. Target market for this project is generation Z & the planogram, placing the skus within differentiated
Globally, we have conducted Millennials consumers that seek something healthy and rice.
At the same time, there are many researches that
at the same time easy to prepare. It is more focused on
have been conducted in the last decade in order to researches which show that Incremental growth: key success of the project would
the younger generations that tend to be more careful
define the optimum excellence in execution regarding be to bring incremental value not only to Uncle Ben’s
Merchandising Key Beliefs and optimum Displays
70% of Mars growth stems with their health & wellness, they are willing to pay more
but also to rice category. This means that it shouldn’t
for “better for you” products but at the same time they
visibility that drive incremental value for the category. from Category growth and dilute our core base (Dry rice) but bring incremental
are too busy in their daily routine.
value share to our brand.
In Greece we have 2 FTE under Category management only 30% from share gains.
department while our end-to-end (E2E) activities from For those consumers the new segment of Rice in 2’
Distribution: 3 SKUs to reach 100% ND / 2 SKUs 83%
Marketing to Sales have always in mind how they can (Ready to Heat) can inspire them to cook more in the
/ 1 SKU 70% / 1 SKU 45%.
increase the total category apart from gaining share. As a kitchen and find new ways of rice consumption. At the
result, our communication above the line (ATL) as well as same time, studies have shown that women tend to Choose the right skus: Among an assortment of more
below the line (BTL) activities and product launches are spend less and less time in the kitchen while in Greece than 100 skus in a European level, it was a challenge
always evaluated under the prism of Category growth. there is also very steep decline of food delivery at home to decide which flavors would be relevant for the Greek
(i.e pizzas). Consequently, this segment can offer the consumer as we should match them with the local
Number of people employed in Category List the retailers you worked with on this
solution in the daily dilemma between easy & fast vs hero meals and nutritional trends as well. Following
Management team in your Company? project? Healthy & nutritious. the preferences and the routines along with the health
2 people in Greece My Market & well-being trends we managed to launch a well -
balanced portfolio, covering all the above.

160 161
PROJECT IMPLEMENTATION

Describe the project framework and what Briefly describe the key steps taken to Describe the brand resources assigned to Describe the retailer resources assigned
tools you used. complete the project. the project. to the project.
The tools we used for this project The 1st step was to re – define our strategy in Food a. Multi-functional leadership team had the A cross functional team from the side of the customer
a. Category vision deployment for Rice Category segment, giving priority to the Ready to Heat (RTH) responsibility to align on connecting the company’s was behind this project while there was support from
segment with all tools & framework as described in brand building strategy with the go-to-market higher management as well. The key elements that
b. Category insights from Global team previous section. strategy. This team comprised: customer offered for this category project were the
c. Local consumer & shopper insights from various following
sources
The second phase was the engagement of our partner b. Marketing Director & Sales Director
customer behind our Category Vision for Rice category
c. Brand Manager ∂ High distribution for our SKUs even in smaller stores
d. Customized Promotional plan for this new segment
in order to drive Trial and penetration
based on trends in the category and consumer and
shopper insights from global team. Based on those i. Overall strategy around product , pricing, ∂ Right placement in the Aisle

e. Sampling & product tastings insights, growth opportunity was clearly defined behind promotion, place, along with total ATL & BTL ∂ Focused secondary displays near Fresh & Protein

propositions that can help consumers eat healthy & plan ∂ Product tasting and sampling in specific stores
f. Customized Planogram proposal in order to depict
this new segment in the optimum way
nutritious meals with easy and quick involvement. d. Category Manager ∂ Collaboration of Marketing departments regarding
the digital communication of the products
g. Second displays in high traffic and also near Fresh The third phase was the agreement between Mars and i. provide concept selling story
My Market behind specific KPIs regarding excellence in ii. Provide key directions regarding planograms
& Protein in order to exploit the opportunity behind
execution in order to optimize placement of this new
“Meal preparation” shopping trip
h. Last but not least, we implemented all key learnings ∂ Shelf Layout Proposal segment & focus behind Distribution built up
we had from other markets as prerequisites for ∂ Secondary Displays execution e. Customer Marketing Manager
success, ∂ Promotional Plan i. develop shopper marketing plans, focus behind
i. Right Range (at least 5 SKUs) ∂ Sampling second displays
ii. Right Price point ∂ Assortment optimization f. National Account Manager and key Account
Manager
iii. Right Distribution levels
iv. Focus behind second displays as the segment
leads to impulse purchase

RESULTS

What were the key quantitative results? Distribution: We managed to reach agreed targets in
all SKUs (3 SKUs to reach 100% ND / 2 SKUs 83% / 1
Incremental Growth: The new segment of Rice in 2’ SKU 70% / 1 SKU 45%.)
(Ready to Heat) has managed to show very successful
Shelf Space: We managed to gain 17% of shelf share
results in the first two years of Launch in My Market.
with vertical placement of all UB Brand. RTH SKUs
From practically a non-existent segment, it has
were also placed by 50% on Diamond area
managed to be 4,3% of TTL Rice category and be the
main reason (40% contribution) for My Market Rice Right SKUs: We managed to have a balanced portfolio
category increase by 10,5% while rest market growth under RTH segment with all SKUs being equally
was 4,5%. Moreover, UB DRY segment increased by successful not having huge differences in the value
26% and following this increase, UB Brand reached share they built.
a Value Share of 16,3% from 11,6% two years ago
increasing by 74% in Sell out. Finally, My Market was
-6% vs avg price per kg of Greece Rice category while
with the launch of RTH managed to climb at +2% vs
avg price per kg of Greece Rice. The increase in price
per kgr was 13% with RTH segment contributing 50% of
that.

162 163
 KEY LEARNINGS

What were the major barriers faced What key advice would you offer to your
during the project? peers who are considering investing in
Category Management?
∂ Engage Leadership team and overall internal
stakeholders & Key Accounts team behind a ∂ It is essential to build your Marketing plans based on
segment that was simply non-existent in the RICE deep category insights behind consumers. It is also
category. Time & budget resources should be pivotal to have the knowledge behind shopper habits
devoted in order to make it work and this was also and plan accordingly the go to market strategy
another big challenge. At the same time mindset in
commercial team had to swift to really focus behind ∂ Deep knowledge behind category segments and
how each segment is linked with consumer insights
RTH segment since traditionally all the focus was on
and macro trends is crucial. Having this mindset,
DRY Rice.
the outcome will be to define a clear category
∂ Engage customer behind this new segment that can strategy in order to unlock a sustainable category
unlock RICE category through premiumization. It was growth and get out of a vicious cycle that can lead to
very difficult to convince local buyer to give the right commoditized categories
focus on all elements of Aisle, Distribution, Displays
& Promos behind such a small segment ∂ All the knowledge behind category and shopper
insights should be frequently shared with strategic
partners (retailers) in order to build a trusted
What were the key qualitative results? We managed to build a much stronger in-store presence What would you do differently if starting collaboration that can lead in more fruitful way to do
for the total range of our Food portfolio, leading to the project again? business and both parties think more strategically
It was the 1st time that our Food segment invested successful results not only for RTH but also for Dry and less tactical.
so much in a strategic collaboration with one retailer, Rice, improving the planogram for total Category. Highlight more to the regional team the importance to
providing an exclusivity of a new range – an innovation share more tangible results from other countries that
The support of the retailer in 2nd placements next Include any links that lead to more
within Rice category. It proved to be a win – win had launched earlier. More data & strategic guidance
to fresh & protein was a key to success, leading to information about the company, project,
collaboration as the retailer trusted our Category Vision, would help us build stronger background when
inspiration for meals, then to trial and most important:
implementing all relevant KPIs that would make the preparing for the national launch. website etc.
penetration growth, which is our main purpose for the
project successful.
long-term viability of the product.
Please find below some relevant links where you
can see more information about the project and the
products.
www.productoftheyear.gr/nikites-2019/
www.supermarketawards.gr/past-winners/
(Optimum collaboration between Suppliers &
FMCG supermar)
www.unclebens-specials.gr/

164 165
 Developing and implementing an PROJECT METHODOLOGY
Infant Nutrition Category Business
Plan to maintain category growth and Briefly describe the project background/ Describe your target market for this
challenge and the rationale that led the project.
development in the Brasil Drug Store /
team to propose this project.
COMPANY BACKGROUND Pharmacy channel Infant Nutrition’s target shopper are mothers and fathers
Infant Nutrition execution in Brazil’s Drug Chains with babies from age 0 to 5 (or expecting).
and Pharmacies is particularly important since it
This case study is submitted by: corresponds to, on average, 80% of all the category
List and give a brief overview of the main
Bárbara Ribeiro, Gabriela Machado and sales (when compared to the other channels in which it
Juliana Kauffmann is present).
objectives of this project.

Title:
Formula for Young Children Baby Food, Infant Cereal It is a challenging category for numerous reasons. The main objectives of the project are/were:
and Milk Compounds and Baby Snacks
Firstly, it has had great results throughout the years,
Category Management Manager, Coordinator and
since it is a category driven by necessity. This makes it ∂ For Infant Formula, increase Market Share
Analyst
hard to keep reaching higher numbers. ∂ Building/strengthening relationships with clients
Company Name: Secondly, it is a fact that birth rate is decreasing ∂ Reinforcing leadership perception within the
Nestlé Brazil (parents are having less children), which directly affects category in question
the number of consumers.
Product Name & Relevant Category: ∂ Generating shopper/market insights to make the
At last, there are increasingly high regulatory limitations category evolve consistently
Category: Infant Nutrition
when developing execution strategies for the Infant
Four major sub-categories: universe – especially Formulas, which is the segment
∂ Guaranteeing excellence in execution
∂ Infant Formulas 1 - 5 years
Complementary foods
(from 6 months on) that represents the most in sell-out. ∂ Providing capacitation to retailers
∂ Formula for Young Children and Milk Compounds
∂ Baby Food, Infant Cereal and Baby Snacks Nestlé complies with the Brazilian legislation
∂ Infant Supplements) implementing the WHO Code, as well as with the What KPI’s were used to measure the
Infant Formulas Infant Supplements
provisions of the Nestlé Procedures. Therefore, no project outcomes?
Location of Marketplaces: promotional activities are performed for such category.
All states across Brazil – according to the clients’ In addition, company personnel do not have contact ∂ Number of captaincies acquired
representativeness. with pregnant women or mothers of infants and young
children in order to directly or indirectly promote Infant
∂ Number of planograms developed
Annual Local Market Sales: Formula. ∂ Number of implemented stores
> €1 Billion
Due to that, Category Management has proved to be a ∂ For Infant Formula, increase Market Share
strategic milestone to optimize sales whilst driving value
How many employees work in the relevant
to clients, based on three main pillars:
∂ Other CRM growth KPIs: increase in penetration,
marketplace? sales frequency, average ticket, etc
Around 20,000 1. Assortment optimization, considering prime items in
Breast-milk substitutes From 5 years on NNS and strategic ones (e.g.: innovations)
How significant is your product within your (0-12 months)
chosen product category? 2. Perfect Execution on the POS, according to the
Extremely significant; Nestlé is the leader player in Infant category’s building blocks and the shopper’s
Nutrition in the selected marketplace and is continuously behaviour.
How many people work on the Category
growing beyond the market. Management team that delivered this project? 3. Shopper/Market insights

How advanced is Category Management within Three people; Infant Nutrition Pharma Channel
your company? Category Management team – all based in Brazil.
Very advanced; The team is structured with a leader, two List the retailers or suppliers you worked with on
coordinators (each focused in one channel – Pharma or this project (list in order of involvement where
Supermarket) and eight category experts, considering all
possible):
different categories that Nestlé works with.
There are also third party members (three) that assist ∂ Direct Channel: Brazil’s main Pharma chains – 91%
with the databases’ development and management as NNS coverage. Objective: proximity, assortment/
well as with the planogram-making phase. planogram development and shopper insights.
∂ Indirect Channel: training to more than 200 drug
chains (partnership with Febrafar and Retail Farma).
Objective: providing information to retail.

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PROJECT IMPLEMENTATION

Describe the project framework and what (iii) Baby Food and Baby Cereal need to
Briefly describe the key steps taken to Step 4: Assortment analysis and definition: based
tools you used. be developed in Brazil, following more on the items representativeness in each of
mature markets such as Mexico and the
complete the project.
the defined clusters. The clusters usually
The project counted on a series of actions: US – Gerber. Both have huge potential in contemplate the size (store space to execute
Step 1: First contact with client: Selling Story
increasing the shopper’s spending ticket and the category), socioeconomic profile and
1. Define Scope: presentation and explanation of execution
providing a complete solution for infants. region. Metrics utilized are 60% of sales in
rational, based on three pillars:
∂ Category: Infant Nutrition value (R$) and 40% in volume.
∂ Clients definition and prioritization, based
∂ Channel/category specifications. For example: Trade-up for Milk Compounds Step 5: Planogram analysis and definition: the items
on representativeness in NNS and structure disposition in the planograms must reflect their
capabilities (iv) Pharma channel’s mission is to provide
representativeness in the defined clusters. It
convenience and specialized nutrition.
2. Deep Dive: must also follow the category’s rational:
(v) Infant Nutrition category is considered
∂ Understanding shopper/market trends. “destiny” in the channel
∂ Execution must follow the consumer journey
For example: – according to the suggested age of use
Trade-In
(vi) It is highly emotional category – the POS (Infant Formulas > Baby Food, Infant Cereal
(i) Infant Formulas is a segment driven by must reflect that so that the shopper feels and Baby Snacks > Milk Compounds >
medical demand, which means that the POS sheltered. Infant Supplements)
must contain a complete assortment, so that
the shopper can make his decision based For this step, we have had integrations with the ∂ Infant Formulas must be segregated into
on previous guidance – if the POS does not multifunctional team (trade, marketing, CMI, sales) and Special Infant Formulas and Regular Infant
contain the item, he/she will more than likely used other research platforms (Nielsen, dunnhumby, Trade-Across Formulas
Close-Up) in order to gather as much information (excl. Infant Formula)
migrate to a different one.
possible, to then develop a Sellingstory to present to
∂ Baby Food, Baby Cereal and Baby Snacks
(ii) Milk Compounds is the segment that must be positioned in a space with good
retail.
contributes the most to the category growth, visibility, in order to boost impulse sales
3. Contact with clients
but still has opportunities in penetration,
considering its relevance versus regular cow
∂ Rational must consider shopper’s behaviour
For this step, we guaranteed alignment with the sales and guarantee more visibility to segments
milk. team member responsible for the account, so that that add value to the category (e.g.:
Step 2: Confidentiality Contract: written agreement
we would understand the client’s background and Premium and Super Premium segments)
for the client to provide sell-out information –
opportunities.
cannot be shared with other areas within the Step 6: Development of the execution guides:
company. compiled file for the merchandising team to
implement
Step 7: Implementation in-store
Step 3: Development of the diagnosis: category
performance in client versus market in Step 8: Continuous monitoring: monthly sending of
question. One-Page with category results and deeper
analysis three months post roll-out

168 169
Describe the brand resources that were Describe the retailer resources that were What were the key qualitative results of
assigned to the project. assigned to the project. the project?

Project Manager – experienced manager brought from Project Manager/Coordinator – member guiding the As mentioned before, the key qualitative results were:
the market to re-build the Category Management area in project and responsible for establishing goals
the company
∂ Building/strengthening relationships with clients
Project Expert – person closer to the operation;
Project Coordinator – role of assisting the Category assisted with regular touchpoints and project progress
∂ Reinforcing leadership perception within the
category in question
experts in the conduction of the projects by conducting
periodic meetings and coordinating the schedule ∂ Generating shopper/market insights to make the
category evolve consistently
Project Expert – analyst responsible for the direct
contact with each one of the clients and development Nestlé is the leader player in ∂ Guaranteeing excellence in execution
of the assigned tasks (e.g.: analysis, assortment/
planogram development, constant meetings, etc) Infant Nutrition in the selected ∂ Providing capacitation to retailers

Third parties – employees that assisted with the marketplace and is continuously
What were the major barriers faced
operational process (databases setup, planograms growing beyond the market. during the project?
adaptation, etc)
The limited space to expose the whole category, most
of which consists in two modules. There, different
products, sizes and colours share the same shelves,
making it difficult to provide a pleasing shopping
RESULTS experience.
Also, the lack of information – from the shopper of the
What were the key quantitative results of ∂ 254 different planograms: considering specific
category, the clients and the store staff.
the project? clustering (category size in store/region/
socioeconomic profile) From the shopper’s perspective, there is a significant
challenge, since there are restrictions in terms of
The quantitative results in one year of project were:
∂ Implementation in over 5K stores
direct contact with the shopper, considering both the
∂ 10 captaincies (+ 5 additional projects) within the
∂ An average result of 2.7 x sell-out growth, and Brazilian legislation and Nestlé Procedures for the
Pharma channel: coverage of 91% in NNS – direct a significant increase in Market Share for Infant implementation of the WHO Code.
channel Formula.
Regarding the client’s/store staff’s perspective, the lack
of information makes it a challenge for them to correctly
Before execute and maintain the category’s rational, whilst also
providing the information that the shopper needs.

After What would you do differently if starting

the project again?

Starting the project with a smaller number of clients to

Nestlé is the leader player
then expand the business model.
in Infant Nutrition in the
What key advice would you offer to your selected marketplace and
peers who are considering investing in is continuously growing
Category Management? beyond the market.
Search for as much information as you possibly can,
regarding the category, the shopper and the channel
you are working with. This helps in not only being more
assertive in your decisions, but also bringing credibility
to the retailer and a sense of partnership.

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 TECHNOLOGY
IN
CATEGORY
MANAGEMENT

172 173
 Category Management must embrace
the power of customer insight

To be fit for the future,

Category Management
must embrace the power of
customer insight

It’s no overstatement to suggest that when Dr. Far too often, they are left to make those decisions
Brian Harris first introduced his eight-step Category without a clear view of how they will impact the end
Management model back in the early 1990s, it was customer. While they might have access to more
a watershed moment for grocery retail. Here, for data than ever, without the structure to consistently
the first time, was a unified framework around turn customer insight in to action, even critical steps
which retail buyers and suppliers could both rally, like category roles or determining which levers to use
one that would allow the former to draw on the require Category Managers to rely on prior experience
innate expertise of the latter and imbue a culture and interpretation at best and pure guesswork at worst.
of collaboration based on the accomplishment of
As a result, making confident decisions about
common goals.
fundamental elements of a Category Management
Two decades on, and even with the introduction of strategy can become a laborious, time-intensive task
a refined, more customer-centric framework in the that still doesn’t come with any guarantee of accuracy.
mid-2010s, the opportunity to inject something fresh For Category Management to be fit for the future, this
and powerful into that model has never been greater. has to change.
Thanks to the explosive growth of ecommerce and rapid
gains in insight gathering capabilities, retailers now The absence of fine-grain insight hampers
have a chance to fundamentally rethink their approach nuanced thinking
to Category Management by making it customer-, not
One of the many benefits that the latest customer
product-, led.
insight approaches bring is the ability to make even
While this may sound counter-intuitive for a discipline more nuanced decisions about customer needs than
that is, at its core, product-centric, the need to make ever before. And when that insight is absent from
that shift is growing by the day. Although the eight-step Category Management, it can leave many decisions
model that many retailers have come to rely on over the looking like they were made with blunt instruments
past 20 years continues to be a valid framework, it was rather than surgical tools.
developed in a retail environment vastly different to the
Let’s take Category Roles as an example, and the
one we see today. Ranges are broader, margins tighter,
“destination” role specifically. Historically, traditional
and customer needs are changing faster. Category
logic here suggested that, if they wanted to make or
Managers now need to make quicker, smarter decisions
maintain a destination category, retailers needed to lead
than they ever have before.

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 Category Management must embrace
the power of customer insight

the pack on every lever they could pull. Not only would Modern retail is built on data, and the time for Category
they need a great, competition-beating assortment, Managers to use that foundation for their own purposes
they also needed to allocate a disproportionate is increasingly overdue.
amount of shelf space, over-invest in prices, run
regular promotions, and open up a constant line of Certainty through structure
communication with customers about that category.
As mentioned above, the traditional Category
Let’s be clear, this approach probably would have Management model follows an eight-step process. In
worked. Moreover, it would have been a fair strategy to recent years, some consultancies have created their
adopt when access to granular insight was still limited. own interpretations that have cut this down to five or
Today, however, it would rightly be called out for being six steps. Our own model doesn’t discard the eight-
hugely expensive and ultimately unsustainable, and step process but aims to strengthen it, improving the
that’s because it’s founded on the assumption that each effectiveness of category strategies and planning
of these levers is equally important to every customer, through customer insights. Data science enables us to
rather than a data-driven view of what actually matters. create category plans through a customer lens based on
four key steps; determining category roles,
establishing levers’ importance in each
category, the creation of category lever
For one of our clients in Brazil, a strategies, and assessment planning that
guarantees insight drives the right action.
restructuring of its pharma category
The truly important thing here, however,
around shopper missions generated is not how many steps you need to
This isn’t information they need to procure or source, a 3% increase in sales alongside a rise in customer
a 4.3% sales uplift. In Canada, a 12% take, but what you can accomplish with
each. We use the transaction and loyalty it isn’t something they need to poll customers on or satisfaction.
reduction in dairy assortment fuelled a leverage third parties for; in the vast majority of cases,
information provided by our retail clients By allowing customer behaviours to inform category
3% increase in sales alongside a rise in in combination with our own data science the information required will already be flowing through
roles, lever importance and strategies, we can help
to do a lot of the heavy-lifting, reducing their systems. It can be complemented and refined with
customer satisfaction. additional input, of course, but the core information that
Category Managers jump ahead to much more
the need for inefficient data crunching, interesting and productive concerns. Rather than limiting
interpretation, guesswork or assumption. can help them make better decisions almost certainly
their agency and creativity, we’re refocusing it where it
That doesn’t mean that we’re handing already exists.
matters most – giving them the certainty they need to
This is a long-acknowledged problem, and some parties control over to a machine, or removing choice from make smart choices about strategies that will deliver
have tried to solve it by ensuring that customer data the equation, it just means that we’re able to quickly Changing needs need a changing approach genuine differentiation based on current and future
becomes part of the Category Management process. establish what really matters to shoppers – and that’s Let’s go back to that earlier example, the destination customer needs.
Together, consultancies, data providers, CPGs, and something that empowers Category Managers to make category, and the blunt assumption that by cranking
retailers have all endeavoured to embed more customer faster, better decisions. Category Management techniques that fail to put
every lever to the max we create a winning situation.
data into category management processes. The key, customer insight at their core are no longer effective at
Rather than leaving Category Managers to agonise What if it transpires that, actually, low pricing and helping retailers make choices. Data-driven ones are.
however, lies not in more data but greater insight.
endlessly about gigantic questions – “how do I know if promotions are the only factors that truly matter to And with customer needs and behaviours changing
Sustainable successes have been few and far between
I’m doing the right things in my category, what are the customers here? How could the shelf space we can faster than ever in recent times, the need for Category
because efforts have focussed on putting the customer
actions that I need to really focus on to move the needle, free up be used? To what extent could we tighten Managers to have a deeper connection with, and
into the process, rather than building the process around
am I doing too much or too little?” – a data-driven assortment? How much could we save by scaling back understanding of, those factors has never been greater.
the customer.
approach to customer insight provides a direct line to on communications? What could we do around pricing As we move into a period of economic uncertainty,
A genuinely customer-centric approach is where the people who can give them genuine, up-to-the-minute and promotions to create an unrivalled reputation as the that will only intensify further; hard times call for harder
I believe the future lies for successful Category answers about all of those things and more. go-to chain for this category? choices, and only with razor-sharp understanding can
Management. Approaches that use advanced analytics they be made well.
The beauty of putting customer data at the heart of We’ve seen first-hand how powerful it can be to have
and allow teams to rapidly identify what matters most
their Category Management processes is that, rather those questions answered definitively. For one of our By infusing Category Management processes with
to customers at an almost microscopic level, with the
than adding additional complexity to an already intricate clients in Brazil, a restructuring of its pharma category customer insight, retailers will give themselves the ability
structure to leverage this for advantage, can provide
process, most retailers will actually be simplifying things around shopper missions generated a 4.3% sales uplift. to do more of what is right – not just for their customers,
the insight needed to make truly smart decisions about
in doing so. In Canada, a 12% reduction in dairy assortment fuelled but for their suppliers and themselves as well.
category levers and how to adjust them.

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 Meatsnack Shopping 2020
– Perfect Shelf

Meatsnack Shopping
2020 – Perfect Shelf
Andreas Luppold, Yagora
& Robin Betz, Jack Link’s

MANAGEMENT SUMMARY ABOUT JACK LINK‘S

Snacking is trendy and the category “meatsnacks” Jack Link’s is the global leader in branded protein
is delivering growth year after year. However the snacks. Jack Link’s is a family owned US business,
category was often underrated in german retail. grown from scratch, now under the second-generation
Visibility instore and on shelf needed improvement. leadership of the CEO, Troy Link.
As the market leader, Jack Links intended to make PROJECT BACKGROUND
Jack Links takes a long-term view of driving sustainable
the category even more attractive in order not to block The category “meatsnacks” is a disregarded category,
growth and has a worldwide presence with 3,500 team
further growth. In a comprehensive 5 stages shopper although it is delivering growth year after year. Since
members, and major footprints in the US, Europe
study designed and executed by the shopper research 2015, sales of snacking products in the German food
(EMEA), Latin America and Australasia.
specialist Yagora the category (shelf and secondary retail sector have increased by more than 50 %.
placements) was optimized and tested in REWE and The EMEA division of Jack Link’s acquired the BiFi
EDEKA supermarkets. The effect of the optimization However, the growth category meatsnacks has not
and Peperami brands from Unilever in 2014. EMEA
was enormous with +18% growth for the category previously been in the focus of retailers. So far, the
represents approximately 10% of global sales and is
“meatsnacks” in comparison to stores in a comparable category meatsnacks had no consistent placement
growing double digit.
control group. Until today Jack Links rolled out the with the result that the category had various different
“Perfect Shelf” in more than 2.000 stores in Germany. Jack Link’s has a strong presence in Germany, the touchpoints and was mixed with other durable meat
UK, Belgium, and the Netherlands, selling high quality products.
salami snacks and beef jerky.
ABOUT YAGORA The whole category was way below its opportunities and
retail execution needed to be improved in order not to
Yagora was founded in 1997 as a data analytics block further growth of the category.
company focused on category management projects
under the name “gps dataservice”. Since then Yagora
has developed into a leading expert for data-driven
shopper insights to optimize the interactions between
shoppers, cpg producers and grocery retailers.

Yagora’s HQ is based in Germany with subsidiaries and

a network in further European and SEA countries. Over
80 experienced experts from FMCG, Retail and Science
provide customer centric solutions proven in over 1000
successful PoS / Shopper Projects.

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 Meatsnack Shopping 2020
– Perfect Shelf

As the market leader in the category with the strong PROJECT STAGES
brands Bifi and Jack Link’s in 2018 Jack Link’s EMEA
Stage 1
Category Management with the help of Yagora started
the project: National pre-check with around 2.500 pictures
from the POS
‘Meatsnack Shopping 2020 In order to collect basic knowledge about the instore
situation in 8 different key accounts more than 2.500
– Perfect shelf’ pictures from the POS were collected via crowd sourcing
which have been analyzed and discussed in a project
team workshop.
a. The mission

b. Research concept

More than 2.500 pictures from the POS at 8 key accounts

The basic idea of the research concept was to collect

basic knowledge about the instore situation and the
shopper, followed by a quantitative research and analysis. Extract of pictures at EDEKA
All insights were then transformed in a new shelf and
second placement concept which was then tested in real The national pre-check provided a comprehensive picture of inconsistent product presentation of meatsnacks with
stores throughout a period of 3 months. varying placement.

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 Meatsnack Shopping 2020
– Perfect Shelf

Stage 2
4 Group discussions and 50 accompanied
shopping trips

In order to get first impressions of shopper and consumer

opinions concerning the category, we conducted four
focus groups with regular and non-regular meatsnacks
buyers and accompanied 50 shoppers at the POS.
Through this qualitative research we got first indications
on their expectations regarding the category and product
placement which was later quantified via the online
research.

But:

∂ Visibility needs to be improved. Although

meatsnacks are an impulse category, they are quite
often not placed in the main shopping aisle / shopper
flow.

∂ The shopper orientation on the shelf is poor because

the products are often presented lying down and not
in an upright position

∂ Therefore, the Bifi trays have been changed from

“lying” to “standing” and also the presentation of all
other products in the shelf have been changed if
possible.

Key findings:

∂ Bifi is the anchor brand for meatsnacks

∂ Meatsnacks should be separated from other durable

sausages products (either with two different shelfs or
within one shelf)

∂ Meatsnacks should remain in the meat-/sausages

department
During the qualitative research shoppers confirmed that
the category meatsnacks should remain in the meat and
sausages product area. However, women and men had
different reasons for this:

∂ Women: practical component – “All meat and

sausage products on my list I can find in one area of
the store”

∂ Men: emotional component – “After I bought a steak

at the fresh meat counter I can treat myself with a
meatsnack”.

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 Meatsnack Shopping 2020
– Perfect Shelf

Stage 3 analysis. Afterwards we developed ideas for shopper Stage 4

Online survey with 1.635 snack shoppers marketing initiatives based on their needs and shopping Scanning data analysis and optimizing visibility
behavior.
Within the online survey 1.635 snack shoppers were The insights of the first three stages were used to build
interviewed. More than 40 questions were answered to This shopper segmentation was matched with an the perfect shelf. Based on the Shopper Decision Tree
check the results of the qualitative study design in Stages existing consumer segmentation to make sure that the the shelf was structured. Then we analyzed Nielsen Data,
1 and 2 through a quantitative research methods. departments Marketing, Category Management and matched it with sales data of individual stores to optimize
Trade Marketing within Jack Link’s have a mutual view assortment, space and visibility using our “Visimeter”.
Key finding: Shoppers are different. In the online study, on shopper and consumer and are able to work better
we identified 7 different shopper types based on a factor together.

Segmentation

Example for one shopper segment: Diversified meat snack enjoyment

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 Meatsnack Shopping 2020
– Perfect Shelf

Stage 5 For the controlled store test, stores from the Yagora
Controlled store test over 12 weeks across 2 panel were selected. They were equally divided into two
key accounts groups, so the control and the test group contain the
same number of stores which are structured similarly
In stage 5 the new shelf layout and second placements in their core features. Because sales development of
were tested in 6 EDEKA und 6 REWE stores over a products is often influenced by e.g. seasonal effects,
period of 12 weeks. EDEKA and REWE are the major these effects must be observed in a control group to be
supermarket chains in Germany with more than 7.000 able to calculate the isolated effect of the test activity.
stores most of them run by individual owners. The controlled store test is divided into a pre period and
a test period. During the pre period no changes are made
After optimizing the shelf a controlled store test is the
in the store. As part of the test period, the new shelf and
ideal solution for testing the new layout under real-life
the optimized range will be implemented within the test
conditions in order to later convince the retailers with
group.
“hard data” to start a national roll-out.

Key findings: • Regarding Jack Link’s Beef Jerky the best

performing secondary placements were next to
∂ The test showed a high potential for sales growth the salty snacks as well as next to the fruit and
with an optimized product assortment and shelf. vegetable department.
The retail partner can therefore grow significantly on
existing space by optimizing the shelf in the category. ∂ By placing smaller packaging units in the prepayment
zone, lapsed users could also be reactivated.
∂ The controlled store test gave also interesting
insights regarding secondary placement.

• The best uplifts for Bifi have been achieved close

to the cashier and next to bread and bakery
department.

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 Meatsnack Shopping 2020
– Perfect Shelf

Stage 6 Since 2018 the perfect shelf has been rolled out in
Roll Out more than 2.000 German supermarkets. Because of
consistently positive feedback from the retail, the next
Due to the fact that the instore situation varied a lot (even step is to roll out the concept with the trade headquarters
within the key accounts), the sales force of Jack Link’s on a national level.
was given the so-called “Orange Rules” booklet. This
booklet is a guideline in order to optimize the category
depending on the individual in store situation.

Andreas Luppold, Robin Betz,

Partner at Yagora Senior Category Manager at Jack Link’s

[email protected] [email protected]

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 Using AI and Technology
to create a better Dairy Category experience

Using AI and Technology

to create a better Dairy
Category experience

OPPORTUNITIES DAIRY CATEGORY TRENDS

Key opportunities for performance improvement in Changes in consumer behavior and the industry
Dairy categories were identified as: landscape require the retailer to rethink its approach to
selling its Dairy categories and products
1. What should the retailer be doing to improve
performance of Dairy categories given the trends Consumer Trends
occurring in the dairy industry? 1. Millennials & Gen Z consume less dairy (animal)
and demand sustainability and provenance
2. How to reduce Yogurt Shrink and Shrink in the
while looking for new product ideas
overall Dairy case?
Implications:
3. Where are the opportunities to grow the retailer’s
Private Label Brand in Dairy? ∂ Growth of Animal Free Product will continue to grow
at a double digit CAGR
Key issues that impact performance include:
∂ Growth of start-ups focused in this area will create
∂ Space is limited, complicated and expensive new item opportunities

∂ Multiple owners of Dairy category assortments ∂ New items ideas emerge in Europe and Asia
• Dairy Category Manager ∂ Sustainability messaging and provenance are the
• Ethnic Category Manager new capabilities
• Store Operations
2. Health concerns continue to grow and will
∂ Planogram process has many work arounds
become an even larger lifestyle purchasing
∂ Current store clusters are Ethnic and Value trigger
Clusters only
Implications:
∂ Shrink in certain Dairy categories is high without
∂ Proliferation of SKUs in this area straining the dairy
understanding why
case

∂ Calling out health benefits on packaging, in-store and

across digital a must
Sustainability messaging • Diabetes / Heart Risk
• Healthy Additives
and provenance are the • Digestive Health
• GMO / RBGH Free
new capabilities

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 Using AI and Technology
to create a better Dairy Category experience

3. Preferences vary by ethnicity, and for immigrant 3. The Next Cash Cows RETAILER TRENDS
populations, brands and product from their Many consumers are looking for alternatives to cow’s 1. Promotional spending is not an efficient way to
country of origin are sometimes preferred milk but still seek the nutritional benefits of animal-based grow the Dairy Category
Implications: dairy, creating opportunities for alternative animal-based
Level of Promotion Support is no guarantee of growth
milks.
∂ Facing of base planogram must grow or shrink based
on preferences of ethnic populations. Most relevant to:
• For milk alternatives, Hispanic customers over- ∂ Milk
index in preference for almond, coconut and soy
∂ Cheese
∂ At a certain index, integration of ethnic products into ∂ Yogurt
main set will drive sales
4. On-The-Go Nourishment
4. Grocery On-Line and Digital will grow post
COVID-19 and potentially settle at a 100% Food and drink products need to adapt to the reality that
increase in usage creating the opportunity for a traditional main meal consumption is declining in favor of
smaller, simpler and more convenient options tailored to
Digital Dairy
busy lifestyles.
Implications:
Most relevant to:
∂ The demand for additional SKUs with limited space
∂ Cheese
makes the move to online only or the Digital Dairy as
a solution ∂ Drinkable yogurt

∂ The Digital Dairy can help execute the health and ∂ Dairy-free alternatives
sustainability messaging across all customers
5. Foodie Flavors
∂ Provenance will come to life in the Digital Dairy
The desire for novelty and surprise is evident among
dairy consumers — a reality that is vital for traditional
PRODUCT INNOVATION TRENDS dairy manufacturers to acknowledge as plant-based
Level of Growth Not Correlated with Level of Promotion Support. Of the 3 categories delivering real growth, 2 received
options continue to proliferate.
Global Data has identified five key innovation trends in very low support
dairy: Most relevant to:

1. Functional Focus ∂ Yogurt

∂ Milk
Consumers have an improved understanding of how diet ∂ Cheese
affects health, and are making food and drink choices
based on their specific nutritional needs and health
concerns.
Most relevant to:

∂ Milk Consumers have an

∂ Yogurt
improved understanding
∂ Dairy-free alternatives
of how diet affects health,
2. The Pro-Plant Push

A pursuit of holistic health is prompting consumers

and are making food and
to consider the broader environmental and ethical drink choices based on their
implications of their purchases, which is elevating the
appeal of plant-based options. specific nutritional needs
Most relevant to:
and health concerns.
∂ Dairy-free alternatives *With sales of at least $30Mil

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 Using AI and Technology
to create a better Dairy Category experience

2. Shopper ethnicity plays a key role is product 4. Dairy Categories Attract Trips
preferences Trip Drivers – Best Super-Categories & Categories
Non-dairy Milk Purchase, By Race and Hispanic Origin
August 2019
Trips per buying households

What non-dairy milks have you purchased in the past 3 months? (%)
Based on 2,000 internet users aged 18+
Source: Lightspeed/Mintel

POTENTIAL IMPROVEMENT ACTIONS 3. Align the Supply Chain

BASED ON DAIRY TRENDS Ensure that supply adapts to changing demand
Although Almond milk is the most preferred non-dairy milk overall, Asian customers over-index in coconut and soy milk
1. Redefine the Assortment ∂ Reassess supplier ecosystem to include new
preference. Black customers over-index towards flavored options.
Use localized consumer insights to… products and providers

3. Dairy drives shoppers and trips ∂ Understand the roles (e.g., trip driver) of various ∂ Establish supply chain transparency to better
subcategories and products for each consumer manage flow and risks
Large Dairy Categories Best at Attracting Shoppers segment ∂ Ensure adherence to quality and value standards,
e.g., cold chain, animal wellbeing
∂ Determine product range and space allocations
Shopper Attraction – Best Super
∂ Identify which products must be sold in store vs. ∂ Ensure supply with strategic relationships and vertical
- Categories & Categories online and by location integration
% Household Penetration
∂ Real Solutions to the plastic problem in dairy
4. Optimize Operations

2. Enhance the Shopping Experience Adapt retail operations to support updated assortment
and experience
Use shopper insights to…

∂ Understand how to support single-channel and omni-

∂ Enable store and customer service associates with
product knowledge
channel shopping behavior

∂ Provide tools that enable product comparison and ∂ Accommodate third-party picking operations
specialized selection (e.g., expiration date) ∂ Adjust sale/backroom space allocation to support
∂ Match shoppers to products suited to their needs and new ways of shopping
preferences

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 Using AI and Technology
to create a better Dairy Category experience

USE OF AI AND MACHINE LEARNING AI, data and technology allows hyper-local analysis at
the individual store level to drive assortment, pricing, Dairy sales are determined by the match between “supply” and “demand” factors at each store. Getting the right match
AI and Machine Learning allows us to create Category requires AI and Machine Learning.
promotion, and demand forecasting and develop the on-
Plans, assortments and planograms based on large
line Dairy program.
amounts of internal and external multi-source data.

Basic data shows significant variation among store shopper bases which can be directly correlated to Dairy Department
dynamics. Recommended actions must be store-by-store based. AI and machine learning tools provide the key insights.

Store location Store Location, demographics for the store location, etc.

Customer Customer attributes, demographics, loyalty, preferences, etc.

Economics CPI, Household revenue, Credit data, Saving rates, etc.

Weather Temperature, pressure and precipitation trends and seasonality

News News hits, trends and sentiment analysis

Events Number of events, popularity, etc.

Trends Web search hits, Web traffic, etc.

Analysis based on of 8 Representative Stores
Social Media Social Media hits and sentiment analysis Source: Demographics based on US Census for store Zip codes. KLT and Dairy Size provided by Retailer.

196 197
 Using AI and Technology
to create a better Dairy Category experience

EXAMPLE - STORE 0272

Insights: ∂ Expand Eggs (Asian)

∂ Older population lives in this area ∂ Ensure base set has more facings of Soy products
∂ Highest housing value - $336,000 (Asian Preference)

∂ Lowest CNI score indicating that overall community ∂ Increase SKU’s and facings of Coconut Milk
has good health (High Income)

Improvement Actions: Expected Improvement Outcomes:

∂ Limit yogurt, especially Child Friendly SKUs (Low ∂ 2-3% Sales increase
Children)
∂ 5-10% Gross Profit increase
∂ Limit almond, coconut, cashew, soy, flax, oat, pea-
protein SKUs (Gen X and Older)

∂ Expand Digestive Health Products (Asian)

198 199
 Using Blockchain to promote
food category quality

Using Blockchain to
promote food category
quality - Carrefour’s Food
Provenance Program

Opportunity collects data and interactions carried out by every

participant in the food industry.
∂ 71% of retail shoppers say traceability is important
and that they are willing to pay a premium for it 1 ∂ After successful pilots on Spanish Chicken and on
Nestlé Mousline, IBM built a platform to onboard a
∂ 70% of grocery shoppers say it’s very important to
large number of suppliers and products on the IBM
have accurate product information at the shelf or
Food Trust platform and to communicate the key
alongside the product 2
product information (provenance information).
∂ 49% are willing to pay for quality and safety
standards (organic, hormone-free) 3
Results
∂ 30% are willing to pay for social responsibility (free-
range, pasture-raised) 3 ∂ Marketing studies confirmed that shoppers prefer
products that are on Blockchain over products that
are not.
In January 2018, Carrefour launched a transformation
plan around 4 pillars. One key pillar is to promote Food ∂ Carrefour has seen a significant increase in sales of
Quality for all to drive customers to Carrefour stores and the pilot categories and a halo effect on store sales.
to win them over from the competitors who are cutting
prices as a key strategy. ∂ Carrefour saw a 200% uplift on poultry and dairy by
exposing provenance data to consumers with a QR
But shoppers no longer trust marketing messages so code
Carrefour needed a way to prove the quality, origin and
claims of the products it sells.

Approach 1
Haller, Karl, Jim Lee, and Jane Cheung. “Meet the 2020 consumers
driving change.” IBM Institute for Business Value. January 2020.
∂ Blockchain is the perfect technology to provide 2
Food Marketing Institute (FMI), Hartman Group. “U.S. Grocery
that proof. Blockchain technology is an innovative Shopper Trends 2019.” Food Marketing Institute. 2019.
solution creating even greater levels of transparency 3
Nielsen, https://www.nielsen.com/wp-content/uploads/
in the food supply chain. It is a digital network which sites/3/2019/04/Healthy20and20PremiumWeb_1000px-2.png?w=1110

200 201
 Using Blockchain to promote
food category quality

Carrefour and Nestlé are members of IBM Food Trust

and are working together on food traceability. The
Carrefour, Nestle and IBM partnership on the IBM
Food Trust platform started with Potato Products and
continued with Infant Powdered Milk.

Example: Where does this MOUSLINE® come from?

By scanning the QR code on the MOUSLINE®

packaging, the consumer has instant access to a whole
∂ The potatoes are processed and packaged in
MOUSLINE®’s own processing plant in Rosières-en-
range of information detailing the product’s entire Santerre in the Somme, which for most of the crop is
production journey from farm to store shelf. close to where they are picked.

∂ Potatoes are mainly grown in the Somme area of Available information:

France by 165 growers working in partnership with • Production
Nestlé.
• Quality control
Available information:
• Variety of potatoes
• Name of partner grower

202 203
 Enabling the Multi-Channel
Customer Journey

Enabling the Multi-Channel

Customer Journey

Albertsons is one of the largest food and drug store This resulted in a fragmented customer journey and a
retailers in the US. It operates over 2,250 stores under tremendous amount of time and money to maintain the
22 different banners across 34 US States and the current infrastructure.
District of Colombia.
Meanwhile, market pressures and the Amazon
Following a period of rapid acquisition and expansion acquisition of Whole Foods meant they had to improve
into new business models (e.g., Plated), costs and agility and speed-to-market to keep pace.
complexity were rising for Albertsons.
It was clear that a new platform was needed to provide
The digital ecosystem needed to support multi-channel Albertson’s customers with an effective multi-channel
shopping had not caught up, and Albertson’s was shopping experience.
operating multiple sites and apps per banner on multiple
platforms.

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 Enabling the Multi-Channel
Customer Journey

OPPORTUNITY PHASE 1 2. Upgraded Native iOS and Android E-commerce

apps
In order to deploy marketing and Category Management 1. Development of the new e-Commerce Platform
methods at scale, Albertson’s multi-channel capabilities and Applications ∂ Native app facelift to support consistent customer
needed to be upgraded and streamlined onto one experience across platforms, with modern look and
Key tasks completed:
platform, one design system, with shared content across feel and functionality
the different Albertson’s banners. ∂ Rolled out new Adobe Experience Manager (AEM)
platform 3. Integrated Email and Marketing Content
IBM was selected to provide expertise and project
guidance. The overall multi-channel capability would be ∂ Launched first responsive framework for significantly
∂ Redefined and streamlined process for consistent
built in 2 phases - improved mobile web experience content production at scale

∂ Phase 1 – Development of the new comprehensive ∂ Streamlined checkout process from six screens to
∂ Simplification and modular design system overhaul to
one appeal to a broader customer base
e-Commerce Platform

∂ Phase 2 – Development of Personalized Shopping ∂ Enhanced the site appearance with custom photo
∂ Introduced authoring tool automatization for efficiency
shoot for ~120 aisles and time savings
Experience Capabilities
∂ Launched a partnership with Instacart to expand the
delivery footprint

∂ Created design system to support consecutive

banner launches

RESULTS ∂ New user checkout completion rate up 73%

∂ 11% lift in orders and 10% lift in daily revenue. ∂ Orders per day up 12.4%
∂ After launch, mobile and tablet device conversion ∂ Optimization at scale resulted in cost reduction and
rates have seen tremendous growth – up to a 318% better targeting and customization of content
lift in ecommerce conversion
∂ 50% reduction in client design team resources by
∂ Mobile web revenue up 51% putting dynamic team members around the business
∂ Conversion up 13% teams with the ability to drive results.

∂ Checkout completion rate up 18% As Albertsons Digital evolves, IBM iX continues to be

their transformation partner of choice.

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 Enabling the Multi-Channel
Customer Journey

PHASE 2 With the redesigned e-Commerce platform now in place, Development of Personalized Shopping Experience
∂ Enable channel-specific experiences at scale
Albertson’s next phase is a personalization initiative - What does success look like? through a personalization strategy that supports
Development of Personalized Shopping Experience to enhance their ability to engage shoppers with
An integrated lifestyle and transactional experience automated offer and customer experiences matured
- Opportunity segmented and contextualized experiences and serve through machine learning capabilities and delivered
supportive of distinct customer contexts across their
shoppers seamlessly wherever, whenever and however across channels consistently.
∂ Albertsons has invested in streamlining the digital they want to shop with the aim to progress to deeper,
shopping experiences. This experience will:
shopping, marketing, and loyalty experience. This
competitive advantage has helped Albertsons
more valuable engagement leading to higher levels of ∂ Enable tailored offers and transaction flows for a • Impacts KPIs such as cart abandonment,
customer satisfaction and loyalty. given shopper context checkout funnel, reduced bounce rate, etc.
continue to expand its eCommerce presence with
30%+ YoY growth in digital commerce, loyalty The core objectives of the personalization program are ∂ Prioritize and deliver personalization use cases Measures of Success
registration, and drive-up-and-go sales. to: including:
• Improved/increased customer conversion (including
∂ However, the US supermarket industry will continue ∂ Enable consistency of multi-channel communications • Abandoned Cart average order sizes and cross-sell)
to be disrupted as Amazon/Whole Foods matures through a contextualized, personalized experience
• Auto-allocation • Improved/increased penetration across product
and continued technical innovation evolves to meet for each customer
• First Time Shopper Loyalty categories (loyalty and cross-sell)
desired shopping behavior.
∂ Increase basket size and conversions for online
∂ Albertson’s needs to establish stronger repeat shopping experiences through improved loyalty and ∂ Envisions a future that is not reliant on segmented • Speed to market (increased efficiency of creation,
cross-selling targeting but is fully integrated with unified shopper production, and publishing/distribution of
business (loyalty, basket size, and cross-sell) with a
data and profile information to drive individualized personalized experiences) across in-store and digital
multi-faceted audience of “Everyday Life Jugglers”
who are resourceful planners using multiple tools
∂ Drive a shift to broader bundling and potentially Own
experiences based on shopper relationship context. properties
brands
and methods to stay flexible in their shopping and
life experiences while enhancing the Albertson’s ∂ Establish a stronger positioning for Albertson’s
standing in digital channels. among competitive entities including Amazon, Kroger
and Walmart through a personalization strategy

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CATEGORY MANAGEMENT
Yesterday, Today & Tomorrow

An ECR Community Review of Current

Practices in Category Management 2020

www.ecr-community.org

ECR Community

@ECR_Community

#ECRCatManNetwork

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