Item and Category Role Definition
Solutions for Category Managers
Leverage Pricing Science to Improve the ProcessCategory planning is the process of identifying those areas within the business that will contribute the most to over-all profit and growth. It includes the process for putting plans into place to achieve the desired results. With an end-to-end planning system, retailers can reap the rewards of putting the plans into practice and monitoring trends.
Part of this planning process involves the identification of category and item roles for an organization. Determination of what categories or items play the role of
traffic driver, basket builder, or
profit generator is key to proper pricing and promotional strategy success.The category management process relies heavily on establishing first the roles in order to set a margin target, identify space and assortment, and develop a pricing plan for the category.
Example: Traffic Driver Category Strategy Role
Within the pricing and promotional optimization tool set from Revionics, determining the proper role and subsequent strategy is based on elasticity, demand forecasting, promotional lift, and results available each week as a result of product behaviors collected.
Deliverables include:
- Category performance results - Everyday pricing
- Promotional category performance results
- Shopper elasticity analysis
- Item elasticity analysis
- Category elasticity analysis
- Category role recommendations
- Category tactics to support role recommendations for base and promotional activity
Example Graph: Customer Response to Promotions and Cannibalization
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