Category management is:
“The strategic management of product groups through trade partnerships which aims to maximise sales and profit by satisfying consumer and shopper needs”
There are two key elements of category management:
Category management aims to provide the shopper and consumer with what they want, where they want, when they want it.
Products are grouped together into categories to reflect customers needs based on how the product is used, consumed or purchased.
A category could be made up of similar products... or be occasion based...
Category management is a continual, long term business philosophy, often approached through a series of short term projects that involve a close working partnership and the sharing of information by retailers and suppliers.
A supplier uses its expertise about who purchases, who consumes, what they want, need and how they behave
A retailer uses its knowledge of its customers, the way they shop, and their purchasing behaviour
Category management promotes cross functional working between companies and will generally involve people from buying, finance, supply chain, trade marketing, space planning, store operations, sales, product development and marketing.
A category’s role and marketing positioning should align with a retailers corporate goals and the overall look and feel in-store mirror the image of the retailer.
The Process
A formal 8-step category management process was developed just over a decade ago by the Partnering Group.
The Category Management Process
Only 9% of companies now rigidly follow the 8-step process. The principals of the 8-step approach have been adapted by companies who have developed shorter, streamlined approaches that deliver benefits in a shorter, less resource intensive, timescale.
