Category management is both the art and the science of connecting your products with your ideal customer. It’s advanced fact-based selling that leverages advanced strategies to help you reach your target audience, increase shopper traffic, grow sales and profits, maximize your distribution, and help you “win at shelf” – all of which are vitally important to your success.

The term category management means different things to retailers and brands across multiple channels. Some category managers do little more than keep store shelves full while others believe that canned topline reports are all you need to succeed.  The power of category management is that it helps you identify and implement strategies focused on growing sales and profits while you satisfy shopper needs.

Early in my career, before the term was coined, category management was largely about populating existing templates and building canned presentations around them. Sadly for most brands, little has changed. Back then, report and presentation building took up the lion-share of every category manager’s time. Data was not organized or segmented. Everything had to be done manually and by hand. Today there are tools that have simplified automated reporting and much of the busy work can be done with the touch of a button. What once took days now takes a few moments.

Flexing your brand muscle

Category management is one of the most underutilized and misunderstood resources a brand has in its tool box. While it’s difficult to accurately gauge the ROI derived from effective category management strategies, it can give you a substantial competitive advantage.

When done right, it can increase distribution nationally, improve merchandising at key retailers, identify optimal price points for feature promotions, and even increase the size of the customer shopping basket.  A talented category manager can help companies reach and exceed their objectives through strategic direction and guidance. The true muscle behind any brand is the strength of their category management capabilities.

I coined the term true category management to differentiate between those companies (brands and retailers) who used canned strategies and reports and the brands that are laser-focused on meeting their customer’s needs and wants.  Traditional category management includes shopper marketing.  Both tend to commoditize shoppers and products into generic buckets. True category management focuses on what makes each shopper unique and pays close attention to their ever changing needs and wants – from the consumers perspective.  This is how you build committed loyal customers.

There is a lot of confusion and misunderstanding around what category management is and what it is not.  It’s not something that only big brands can utilize and should not be a “one size fits all” approach to business strategy.  It does not have to be overly complicated and the same rules that apply to one brand certainly do not apply to every brand.  Creativity and flexibility are things lacking in most company’s category management departments.

True category management is something that every brand should embrace even before your first product launch.  Understanding even the most basic strategies can give you a sustainable competitive advantage in any category and across every channel. The key is how you execute on the strategies compared to competitive brands.

True category management is both the basic and the advanced analysis of syndicated, shopper, consumer, user, market, survey, social media, point-of-sale, panel, attitudinal, internal and external data sources for strategic brand development. It provides detailed actionable insights to grow sustainable sales while meeting shopper’s needs.

Again, let me emphasize that it does not have to be overly complicated and scary.  It’s knowing which tools to use and how they help you achieve your specific objectives.  Think of a contractor building a house.  They do not use every tool they own every day.  They choose the right tool for each job.  They would never use a handheld hacksaw when the job calls for a heavy duty chop saw.  They hire experts when the job is beyond their level of expertise.  The same holds true for true category management.

The goal here is to help you understand the basics along with the key concepts so that you can choose the right tool for each job and to know when you need to hire outside resources.

Dan’s mission is “Empowering Brands and Raising The Bar”.  His weekly newsletter, educational podcast and training courses have become an invaluable resource for brands and retailers seeking a competitive advantage.  To learn more or connect with Dan, visit BrandSecretsandStrategies.com or email dan@cms4cpg.com.

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