As we head into 2014 hopefully you took the time to review your results and performance in 2013. Did you achieve all the goals you set for yourself in 2013? What opportunities have you identified for the upcoming year?
If you have finished that step, now it's time to move ahead with developing strategies to meet and exceed your goals for this year. My first recommendation for retailers and manufacturers to grow sustainable sales in 2014 is to develop strategic partnerships. Together, they can help each other meet shoppers' needs and increase sales.
Retailers have a long list of responsibilities that include identifying the optimum product assortment by category, maximizing pricing and promotional efficiency, reducing inventory, improving operational efficiencies, increasing consumer foot traffic and more effectively meeting shoppers' needs. As they go about these tasks, the greatest asset retailers have at their disposal is their strategic partners: manufacturers committed to helping the retailer grow sustainable sales. Manufacturers are the true experts in the categories in which they sell products. Retailers should use them to help identify strategies to increase consumer take-away.
What are your retail or manufacturing goals for 2014?
On the other side, manufacturers should focus on increasing distribution on core items, maximizing promotional efficiency, improving quality merchandising and retail support and leveraging strategic partner opportunities with retailers. Retailers are the lifeblood of manufacturers and can be key in helping connect a manufacturer's brand with consumers. Manufacturers should do everything in their power to support these retailers in helping them sell more of their products. This should be a win-win situation for both the retailer in the manufacturer.
The common thread throughout these strategies is true category management. This concept can become the great equalizer between large sophisticated CPG companies and mom-and-pop operations. Used properly, it can level the playing field and help you develop a sustainable competitive advantage in any economy. True category management encompasses everything from the initial product concept all the way through to the end consumer. It aims to align retailers and products with consumer needs and wants.
That being said, my second recommendation is to invest in true category management. This goes well beyond the canned topline reports, charts, and graphs to answer key questions like “why what happened happened." Its focus on understanding the “why” behind consumer trends will give you a competitive advantage in any economy and against any competitor.
In future articles I will take a deep-dive into several of the core strategies that make up true category management including how to get started, the resources needed, finding the right talent for the position, how to fully integrate category management with other departments, sales and marketing and how to develop structure around this key competency. Stay tuned!