Category Management Rides Along with Shopper Marketing

Chicago -- It's fair to question whether category management is relevant in a shopper marketing world. After all, traditional practices like SKU rationalization seem rather quaint when compared with, say, customer segmentation.But if the category management and shopper marketing disciplines appear to be disconnected, that's only because retailers and manufacturers have yet to adopt a fully integrated shopper mindset.That was the argument put forth by Don Baker, vice president of pricing and category selling strategies, and Kris Abrahamson, (formerly) director of consumer and shopper marketing at Sara Lee Corp., Downers Grove, Ill. In a wide-ranging presentation at the In-Store Marketing Institute's Shopper Marketing Expo, Baker and Abrahamson outlined several ways in which CPG companies and retailers could usher in a new era of cooperation with regard to managing products on store shelves."Most of what's happening on the shelf comes after consumer marketers have already figured out their plan," said Baker. "We need to evolve our thinking about category management to a place that's more shopper-centric."Abrahamson argued that retailers and packaged goods companies should think of shopper marketing as a way of enhancing category management. Abrahamson said, "If you can better understand what shoppers look for when they go down an aisle, that is going to inform how you shape your messaging, product offerings, price -- everything related to setting the shelf."To further the evolution in category management, the Sara Lee duo advocated the following procedural changes and shifts in strategic thinking: Moving CPG companies away from a one-way product manager-driven mindset to a shopper/customer-manager driven mindset. The goal should be to engage shoppers in two-way communication that builds long-term relationships by promoting the products that shoppers value most at any given time. Moving marketers and agencies away from an interruptive "selling by taking" approach to a permission-based "selling by giving" model (i.e., one that offers customers some concrete value). Baker compared the former to the feeling a car buyer gets when entering a dealer showroom, where you're "protecting yourself from getting taken." And he believes the latter is something that brands such as TiVo and retailers such as Costco have achieved. "TiVo's ads are all about the functionality of the product," Baker said. "When you go to Costco, you almost feel compelled to buy something because the product assortment is so connected to what you want." Pushing shopper insights higher up in the organization and incorporating those insights in the annual operating plan. Consider adopting Procter & Gamble's "store-back" approach to meet the needs of your own organization. "We're trying to get consumer marketers to figure out what they want to do against the 4Ps from a shopper framework, so that their assessment is lined up with key retailers from the start," said Baker. "If all of this is laid on your shopper marketing people at the back end and you're not connecting it to the brand team, you should re-evaluate how you are doing your category management program." Connecting with retailers differently. Skip the jargon-filled PowerPoint presentations and all the brand-speak. "The way we talk about our brands internally is not how we should present to retailers. They care, but not that much," said Baker. "You have to speak to store managers in their language and show them the relevance for their shoppers."

Category Management Rides Along with Shopper Marketing

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