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Category Management
Dr.Amr Aly
Trade Marketing Manager
Nestle
Marketing Club Instructor
CATEGORY MANAGEMENT
Category Management approach usually applied in a trade channel
CATEGORY
• Group “range” of similar or related products
that consumer may perceive that they are
substitute to each other
CATEGORY
MANAGEMENT
• Retailing concept
• Where range of products purchased by
retailer is broken down
• into discrete groups of similar or related
products , known as product categories
Brian F.Harris
WHY CATMAN ?
• 1970
• Small stores
• Less than 400 feet squares
• 200/300 SKUs
• Growing consumption
• Unstructured chains
WHY CATMAN ?
• Multi format stores
• More than 30.000 feet squares
• More than 20.000 SKUs
• Oversupply
• High competitiveness
• So it's important ensure a managing system for each category through
strategies of pricing, promotion, assortment and shelving aiming achieve results of sales
and margins.
THE NEED OF CATMAN
- Retailers
expectations &
needs
- New data sources
- New technology
- Competition
- Consumer
expectations
- Consumer less loyal
- Time
- Product
differentiation
- Channel
differentiation
Increase Decrease
SELLING ENVIRONMENT
• Relationship selling
• Fact based selling
TOOLS
DATA Team Alignment
Collaborative mindset Automation tools
STEPS
• Define Family  CategoryDefinition
• Purpose, location , assortment & pricingRole
• Gap opportunities against marketEvaluation
• Clear & achievableTargets
• Assortment, price, promotion & shelvingStrategies
• Put plan into action & follow upImplement
DEFINITION
Department
( Food )
Family 1
Baby food
Category 1
Cereals
Category 2
Home made
Category 3
Jars
Family 2
Canned food
Family 3
Processed food
Family 4
Fresh food
ROLE
What’s the
purpose
Where
should it
be located
What
assortment
How
should it
be priced
ROLE
Routine Destination
Convenience Seasonal
Preferred Hero
Occasionalimpulse
ROLE
Destination Hero
“I go to this store because they offer
the best selection of X.This store
offers better value in this category.”
ROLE
RoutinePreferred
“I buy these products all the time for my
daily needs, so I look for the store that
offers me the greatest value and
consistent shopping experience.”
ROLE
Routine Destination
Convenience Seasonal
Preferred Hero
Occasionalimpulse
ROLE
Routine
40 +/- 15 %
Destination
5 – 10 %
Convenience
10 %
Seasonal
40 +/- 15 %
Customer Loyalty / frequency
Emotional markets- Niches
- Extra service
Profit margin
- Daily needs
- Traffic generator
- Price competition
- Loyalty of customer
- Product differentiation
- Competitive advantage
EVALUATION
• Contribution of SKU in category
• Market shares
• Growths (opportunities)
• Consumer (Shopper) behavior
• Price average
• Margins
CONTRIBUTION
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Cerelac Std 125gm Cerelac 125gm Cerelac 250gm Cerelac 500gm
Cerelac
MARKET SHARE
90%
5%
3%
2%
MS
Cerelac HeroBaby Riri Others
CONSUMER BEHAVIOR
• Shopper:
• Mothers
• Consumers:
• Babies ( 6months –
3 years)
TARGETS
• Managing the sales mix is the best way to achieve targets.
• So we need to influence the sales of every brand.
STRATEGY
Assortment
• Number of SKUs
• Stock depth
Promotions
• Creating traffic
• Brand plan
Visual merchandising
• Shelving
• Shelf promotion
• Planogram
Pricing
• High / low / medium competitiveness
• Discounts
• All Range
• 125gm
• 250gm
• 500gm
Chain Pharmacy Small Pharmacies
• Core Range
• 125gm
Large Pharmacies
• High selling Range
• 125gm
• 250gm
Assortment
Promotions
Visual merchandising
• Planogram
IMPLEMENTATION
• Put into action plan
• Review
• Monitor
OBJECTIVES
• Lift sales
• Increase product margin
• Reduce inventory
• Increase consumer loyalty & satisfaction
Q& A
THANK YOU
13th Alex Marketing Club 6-1-2018
13th Alex Marketing Club (catman) Category Management by Dr.Amr Aly

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