Category Management: The Gondola Ideal

Néstor Horacio Dario Ahuad and Ruda, TMT executives, Trade Marketing Technologies, a company specializing in trade marketing, sales consultancy and marketing, discusses how to take full advantage of every square foot of the gondola.

The concept of Category Management is relatively new in retail and is a shared process between manufacturers and retailers to assess and manage product categories as individual business units, focusing on delivering greater value to consumers and develop strategies for profitable growth of the category. The objective of Category Management is developing the provision of the category, ordering the display model to give maximum results.

ComprasAhora habits and how has this changed in recent years? Previously, retailers managed to products grouped by Product Type: dry or store, deli, bakery, meat or frozen. As better data became available, and analysis tools on the behavior of consumers from the gondola, and went further research on this point. The channels are developed that have used this concept better. Large supermarket chains apply the Category Management in Argentina some years ago and Wal-Mart is one of the most has developed this concept. The Category Management is also applicable in other channels such as Chinese supermarkets, pharmacies Farmacity type, kiosk or a veterinary, but it is just beginning to apply the concept in this type of smaller channels.

Category Management rendidoresEl pairings must premise that consumers shop by category, and having all the brands and products together makes buying them. Retailers offered in each section to each consumer segment, the type of product that best meets your needs by category: brand, premium or second mark. Another trend is to group by consumption situations: for example, is fine wine with cheeses or foods that pair with the drink. Or, in the case of products for baby, the mother is in one place diapers, pacifiers, strollers, milk, food and even indumentaria.El Category Management takes into account issues such as standardization of the format, or segmentation of the premises. It is considered what type of family in question (can be large, just one or two members or the prototype of the Dinks - Double Income no kids, double income no kids-), purchasing power and competitive edge.

ExpertosPara organize the implementation of the system, the retailers name a category captain, responsible for recommending and set up the gondola, from a deep knowledge of the product category you drive and dynamics point of sale. This person usually belongs to the category leading brand and the idea is that compliance with the win to win: win all brands. The category is more appealing and motivating impulse, tempting consumption.

How do we buy? There are studies claiming that there are certain locations of the products that facilitate the purchase: the most privileged are the leading nacelle, which are located at the beginning of the street from the product family and face the direction of transit the public. The height of the eyes of consumers is 1.60 meters and tend to look first to the right, so that's the most requested location. The areas are divided into client area, which is the location that generates more sales: between the eyes and waist, the warm area is above the eyes to the hand and below the waist to mid-thigh. The cold area is above the eyes, the comfortable reach of the hand and mid-thigh to the floor. On the other hand, there are more hot categories are planned purchase products such as milk, eggs and food staples. Other products, colder and leaving the shopping list are harder to sell and need a more strategy exhibit. That's why some strings begin the journey by such products.

AutomáticoEl Category Management Order is governed primarily under the computer system EDI (Electronic Data Interchange, Electronic Data Interchange) with which it maintains all the online information system: the chain knows exactly how much and what sold and transfers this information to provider, and is ordered automatically, electronically. The chains are investing heavily in development of databases of customers, with a record of who your consumers, how often acquire this or that product. This information is vital to achieve further development of Category Management and can be applied not only in large chains. This is a great opportunity to achieve substantial improvements in business across the entire value chain, looking for distributors, suppliers and customers.

By Néstor Horacio Dario Ruda Ahuad and Trade Marketing Technologies, especially for Infobrand