There are so many data sources and measures available for suppliers and retailing companies – I’ve been asked many times what I think are the “most important” or “best” ones to use.  As I commonly respond to a general type of question, “it depends” – it depends on what you are trying to understand, and what data you have access to.

That being said, I think that baseline and incremental sales information is incredibly valuable for both suppliers and retailers, for scorecarding their business, and measuring ROI on promotions (to name a few).  This data tends to be underutilized in many organizations.  By dissecting your sales volume one level deeper – into baseline and incremental sales – you can really get an understanding if you are building your sales through innovation/marketing/shelving activities (baseline sales) or through promotion / temporary price reductions / display activity.  If you include some basic baseline and incremental measures in your monthly scorecard, you will have a much better understanding of what types of activities are driving total sales.

You can also use incremental sales to understand the true performance of promotions – baseline sales would have …

Last week’s category management tip was primarily focused on how retailers can calculate a breakeven point based on gross margin objectives.  I had a lot of questions from suppliers on expanding more on understanding gross margin and breakeven from their perspective.  Based on this feedback, this week’s tip relates to breakeven, but focused more specifically on the supplier.  I walk you through 3 different costing scenarios for a supplier when booking a promotion with a retailer, and determining the scenario with the biggest payout for the retailer.

Suppliers need to complete profitability / return on investment evaluations to ensure that they are booking the most cost effective options with the best payout.  It’s not a simple task to find the right balance between profit and sales, for both the retailer and the supplier.

httpv://youtu.be/Vu5hX1yqtWI

Enjoy this week’s tip!  If you liked this tip, please “like us” in Facebook. You can subscribe to my blog in the bottom righthand corner, and receive the weekly tips in your e-mail each week.

If you are looking for any training relating to the examples in this tip, you may want to consider …

I certainly am not going to complain about anything in Calgary these days – beautiful snow in the mountains to give us some of the most fantastic ski conditions around, and we are enjoying a balmy 10°C in the city (with no snow at all).  Very unlike Calgary in February, but I’ll take it!

February’s category management tips are all going to relate to the tactics (pricing, promotion, placement, product assortment).  I thought I’d start with one on breakeven analysis, which is a very important consideration for both suppliers and retailers as they determine pricepoints required to achieve margin or profit (in the examples I’m giving today, it’s based on promoted prices).  Suppliers need to know how many units they have to sell to “break even” on the promotion that they run with the retailer – they can check their retailer’s weekly POS data to determine which pricepoints generate the required # of units.  And retailers need to make sure that they “break even” at specific pricepoints, particularly if they have break even …

For the last 3 weeks, I’ve focused my tips on a retailer perspective as it relates to Private Label.  This week, my focus is on National Brand suppliers.  If you are a National Brand supplier in a category that is highly developed in Private Label, or one where Private Label is growing significantly, don’t think that it’s not a potential threat for your National Brand(s). 

You should proactively assess your key retailer’s private label brand results as part of your regular category reviews, at a level that goes beyond a “Total Control Label” sales and share result across some key geographies and channels.  You should purchase your consumer panel data so that it breaks out “Control Label” into specific retailer brands like “Presidents Choice” and ”Great Value” for more depth in your Private Label understanding.  This will add value to your demographics, cross brand interaction and consumer purchase behavior analysis.

httpv://youtu.be/KkzMGnsLC4c

If you are looking for any training relating to the examples in this tip, you may want to consider the following CMKG courses (click on the course for more details):

“Completing …

January and February tend to be my least favorite months (remember, I live in Canada)!  It’s cold, we don’t get as much daylight, and when it’s -30 degrees outside, there’s not a lot of outdoor activities and fresh air.  Oh, to be in Hawaii or the Caribbean right now!

Last week I covered how to assess Private Label performance in a category vs National Brands and vs retail competition.  I also reviewed some ways for retailers to identify who their real brand competition is at a category level, instead of thinking that all National Brands should be treated as equal competition to the retailer’s Private Label brand(s).

This week, we’re going one step further, with a focus on total Private Label “brand health“, that looks at a basic category overview, and then some sample tactical analytics (including price, promotion and assortment).  For suppliers, these types of analytics can also be completed for your own brand’s health assessment, or for a total category health assessment.

 httpv://youtu.be/DElz8jrWLLE

Next week I’m going to review some ways that manufacturers can better understand the Private Label brand, and show some analytics that may help to differentiate National Brand(s) from Private Label competition.

If you are …

I’m having to get used to the cold again for the first time this winter because temperatures have plummeted!  Even though Calgary (Canada) is notorious for cold weather, it’s been pretty mild (10-15°C) and we’ve had no snow for a month.

Last week’s category management tip was on Private Label Essentials.  This week’s tip gives examples of some of the ways that you can start to analyze Private Label for a Retailer compared to the market and the rest of the category.  This is important for Retailers to understand, so they can be more strategic with their Private Label brands at a category level – creating some overall corporate store brand strategies isn’t enough – each category needs more strategic Private Label brand focus to understand development gaps and opportunities, as well as the key national brand competition.

This information is also valuable for Suppliers.  Many Suppliers consider their brands to be premium to their retailer’s store brands, and consider their competition to only be other national brands.  Private Label has almost 100% penetration in households in Europe, and slightly lower in North America.  So almost every household has a Private Label item in it!  And Private Label for many retailers …

Hi, and welcome to my blog.  I’m Sue Nicholls, President of Category Management Knowledge Group (www.cmkg.org).  My New Years Resolution is to start blogging, because I have a great passion for category management related topics, and because my CMKG team and I want to be able to share our passion and understanding about category management with YOU!

In my blog, I’m going to be providing weekly tips that relate to different topic areas each month. These tips will be available via YouTube videos, and will be chockful of tips & tricks & things to consider in your own role. I wouldn’t plan on popping popcorn for the video, because they’re all less than 5 minutes long! I’ll also provide links to interesting resources, articles, whitepapers and other information that you may find useful as it relates to the different subject areas. There’s no selling in these tips, and they are relevant for retailers and suppliers (yes, including sales & marketing, who truly do need to understand all areas of category management!).

If you are interested in receiving my future tips, you can subscribe to …

There’s been so much press and news about Private Label recently, I thought it would be a great way to start 2012, as our January topic.  The Private Label brand story around the globe is really quite incredible. I remember back in my P&G days (1990′s), because of our premium brand positioning, we really could “ignore” the relatively small Private Label brand in the categories in which we competed. Back then, Private Label was primarily a low-quality, low-cost product offering that gave consumers a cheap option to national brands - and you’d never find a single Private Label item in my house!

But fast forward to now, and how things have changed!   The Private Label concept has expanded over the last decade to reach levels beyond anyone’s expectations. The more savvy retailers have managed to create incredible offerings for their Private Label brands, focused on innovation, quality, and pricing and format strategies to capture shoppers from varying income levels (and admittedly, you’ll also find a few Private Label items lurking in my house).

So all of my tips for January focus on Private Label, and are available through video (via YouTube).  You can also find some …

This week’s “Category Management Series Tip” is about the essentials you need to know and understand about Private Label.

httpv://www.youtube.com/watch?v=H5WaWbhuCBY

And please give me feedback, more links to add in that have valuable information for our subscribers, ideas for future topics, etc.  Also, invite others in your organization to enjoy these tips.  If you are interested in receiving my future tips, you can subscribe to my blog (on the righthand side of the screen towards the bottom), subscribe to our channel in YouTube, “Link In” through CMKG’s ‘Category Management Learning Forum’; “Like Us” in Facebook, and/or Follow Us in Twitter.

Next Week’s Topic:  “Private Label Data & Analytics” – don’t miss it!

Here are someuseful links and articles on Private Label that I found interesting.  Please let me know if you have any others you’d like me to share.  I’ll try to keep this updated.

Whitepapers:

Private Label in Europe:  Current & Emerging Trends (IRI)
Private Label: Brand Positioning In the New World Order (IRI)

Recent Articles:

“Are Consumers Losing Interest in Store Brands?” (Deloitte)
“Global Private Label Share To Double By 2025″ (Canadian Grocer)
“Loblaw Launches New Super Premium Black Line” (NewsWire)

 Books:

“Private Label Strategy:  How To Meet The Store Brand Challenge”(Nirmalya Kumar, Jan-Benedict E.M. Steenkamp.
“Private Label:  Turning the retail brand threat into your biggest opportunity” (Keith Lincoln and Lars Thomassen).

Websites:

Stores Brands…