One of the overriding decisions of every category tactic a retailer will enact is the category strategy, in particular, the category role for the retailer. A category role defines how the retailer wants the category to be viewed by the consumer. For example, if a retailer wanted to be the first choice among consumers for meat purchases, we would see that category as a destination role. Batteries, however, may be seen as a convenience role to top up a basket should the need arise. The category role forms a reference point when considering decisions on assortment, pricing and promotion. These should be documented across the entire portfolio of categories and reviewed annually. Having these roles enables a ‘go to market’ strategy for the retailer.
There are four major category roles used at grocery retailers:
- “I go to Shopmart because they have the best selection of _____. There is no other retailer that is better than Shopmart in this category – Shopmart provides a significantly better value proposition for me.
- “I buy these products all the time for my daily pantry needs. I think that all grocery stores essentially sell the same stuff in these categories – so I look for the greatest value and easiest shopping experience.”
- “I wouldn’t normally think to go to Shopmart for these products – but since I’m there anyhow, I may as well pick up what I need. You offer good value and have a decent selection. Sometimes, I just stumble upon these products in your store – I never knew you even carried them.”
- “I had no intention of buying this product on my shopping trip – but I bumped into it and picked one up. This is a bit of a ‘guilty pleasure’ for me – a treat for me that makes shopping more fun. These products never make my shopping list but sometimes end up in my basket.”
Some factors that assist in determining the category roles are market data – share, share change, category development indices), consumer surveys, point-of-sale data, and the company mission and values.
With the category role established a retailer can decide where they want to take the category, or said another way, what is their growth plan. They can be aggressive, aim for moderate growth, maintain growth or harvest the category. Decisions that stem from here could be whether to grow private label in the category or expand merchandising space for example. When category roles are established, every Category Manager is on the same page for the direction of the retailer.
Tags: category management, category manager, category role, grocery retailers, Market Data, merchandising, retailer