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How CatMan + the Meat Case
Can Save the Grocer!
The Category Management
Association
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Category Management:
A Global Standard in 20 Years
• Thanks to the collaboration
driven by the FMI, the GMA
and other trade groups like
the American Meat Institute,
CatMan has become a global
standard for collaboration.
• Today every major retailer and
manufacturer globally uses
CatMan
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Retailers Care about CatMan
Industry Initiative
Category Management
Percent of Respondents
66.5%
Sustainability
38.5%
Diversity
31.1%
Promoting Your Company as an Employer of Choice
31.1%
On-pack nutrition labeling
26.1%
Produce Traceability Initiative (PTI)
19.9%
Geographic Expansion
13.0%
GS1 DataBar
9.3%
Source: Progressive Grocer Market Research 2012
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Category Management Definition
A Retailer-Supplier process of
managing categories as Strategic
Business Units, producing enhanced
business results by focusing on
delivering consumer value
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What is the CMA?
The association for Companies who want to improve the
capabilities of their professionals in:
Category
Management
Shopper
Insights
&
Shopper
Marketing
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Planogram
&
Space
Management
In-Store
Execution
&
Merchandising
The only organization that:
• Certifies CatMan professionals through industry-wide standards
• Serves as an unbiased central resource for
industry information and best practices
Share Groups
• Share Groups connect you to the global CatMan community
• The CMA Holds Monthly Web Based Meetings
Insights &
Analytics
Organizational
Development
Shopper
Marketing
Space
Management
• Solution provider demos once a month
• Website: CPGCATNET.ORG
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The CMA and Certification
•
•
•
•
•
The CMA created skills and capability standards
Standards posted on cpgcatnet.org
We certify training providers to these standards
Trainees take a final test from the CMA
Receive certification at one of three levels
– CPCA
– CPCM
– CPSA
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But First, Where Have We Been?
• TV creates mass
audience at low cost
to advertisers
• This enables growth
of brands and brand
equity
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Weak Regional Retailers
• A&P #1 nationally
3% share
• No Walmart
• No Costco
• Kroger leads in
Cincinnati
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Then Came the Revolutions!
• Communications
– Fragmentation
• Retailing
– Consolidation
• Data management
– The magnetic strip
– Complementary data
bases
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Communications-Cable TV
Fragmentation = Weakening of brands
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TV Fragmentation Hurt Brands
•
•
•
•
•
•
Cost/m grew faster than profit per usage
CPM CAGR > 8% vs. brand profit/use > 3 to 5%
Worse still, ad clutter drives down recall by 50%
TV 1/3 as efficient today
P&G kills brands they can’t support
Goes all in on Tide
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Retail Consolidation
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Retail Consolidation
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And Then Retail Loyalty Cards
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Balance of Power Shift
• Change in budget allocations
• Account based Marketing
• Shopper Marketing as recognition of
retailer power
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Now the Internet and Smartphone
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Marketing Power Evolution
• TV
• Cable/loyalty
• Internet/cell
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Mr. Grocer: Your Diapers are Leaking!
• Amazon has a 25% share of the disposable
diaper category.
• Amazon focusing on “Need States”
• Shoppers are leaking from grocers by ‘need
state’: pet care, beauty care, health care
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Grocers Must Build a Moat
Around the Perimeter
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The Moat is pronounced “Meat”
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Winning the dinner need state is critical
and winning the dinner need state means
winning here
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The first step
towards Victory is
Mastering
Category
Management
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Benchmarking and >CatMan ROI
• The CMA compares the client company’s outputs from 10
documents to what is considered best current practice.
Those documents are:
–
–
–
–
–
–
–
–
–
–
Voice of the Category Shopper
A Category Shopper Management platform
Category business analysis
Annual learning summary
Tactical success models
Account line review for the retailer
Key account analysis and recommendation
New Item introductory presentation
Retail loyalty card analysis
Category/brand retail profit efficiency
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The VOS Taxonomy
Who
• WHO are our shoppers?
What
• WHAT are they buying?
Why
• WHY are they buying?
Where
• WHERE are they buying?
When
• WHEN are they buying?
How
Other Resource
• HOW are we influencing them to buy?
• Links to additional sources of information
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Who
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Who are Snack Shoppers?
Core Truths:
– Bagged snacks are purchased by a broad range of shoppers in virtually every
demographic group. Few categories have such deep penetration, especially
among C-Stores’ core shopper group
– Shoppers vary more psycho-graphically and behaviorally than
demographically
– 5 different ‘need state’ shopper segments have emerged. They have widely
different behaviors and consumption habits. Two segments, ‘All Day’ and ‘TV
Time’, comprise over 2/3rds of total consumption
Need State
Lunch
Munch
All
Day
Party Time
TV Time
Dabblers
Total
% shoppers
22
25
17
20
21
100
% volume
18
38
8
30
6
100
# Snacking Occasions Last Week
Average
Lunch Munch
All Day
Party Time
TV Time
Dabblers
12
11
18
6
14
4
Source: Vendor research, NPD diary
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Who are Snack Shoppers?
Observations:
• c-store snack shoppers are much younger than grocery snack shoppers
• In the overwhelming majority of cases, these c-store shoppers are buying for
immediate personal consumption while grocery shoppers are primarily
buying for family consumption at a later time
c-store Shoppers (% Total)
<21
22-35
36-55
56+
Total
Male
17
21
13
8
59
Female
12
15
10
4
41
Total
29
36
23
12
100
Grocery (IRI)
<21
22-35
36-55
56+
Total
Male
5
6
12
8
31
Female
8
21
26
14
69
Total
13
33
32
22
100
Source: Vendor research, c-store internal research
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Who are Snack Shoppers?
Lunch Munchers
• This segment limits snack consumption to lunch often as a
complement to a sandwich or soup
• Prefer potato chips
All Day Snackers
• This group is addicted to snacks
• They have one favorite but also enjoy a repertoire of 3 to 4
snacks daily
Party Time
• Snack at multi-person events such as a Super Bowl party,
Cinco de Mayo, or family celebrations
TV Time
• Consume snacks while watching TV at night or on weekends
while watching sports. Major consumers of beer, CSD and dips
Dabblers
• Try snacks only occasionally often with dip as meal
replacement at lunch
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IWIK’s = I Wish I Knew
• What other items are the ‘All Day’ and ‘TV Time’
segments buying at c-stores?
• How do snack preferences vary by age/gender?
• What flavors and sizes does the All Day segment
prefer?
• What flavors and sizes does the TV Time segment
prefer?
• How to attract the two heaviest consuming
segments, the All Day and TV Time snackers?
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The Most Challenging IWIK…
Moving from Category
Management to Need State
Management
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Not the Diaper Category…
the Baby Development Need State
My Baby Is developing normally!
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Formats Compete At Need State level
Baby Need State ($HH)
Categories
• How to understand
need state
• How to organize
around need states
• How to optimize
share of need
Feed
Annual $ Groc $ Leak $ % Groc
691.6
378.0
313.6
54.7%
1,221.0
752.2
468.8
61.6%
Fun & Learn
553.8
243.2
310.6
43.9%
Wear
884.0
439.4
444.6
49.7%
Care
327.6
117.8
209.8
36.0%
Safe
628.2
208.3
419.8
33.2%
4,306
2139
1698
50%
Formula
Juice
Baby food
Clean
Diapers
Wipes
Shampoo
Oil
Toys
Books
Photo
Clothes
Shoes
OTC
First Aid
Crib
Car seat
Stroller
Security
Total
130.0
41.6
520.0
780.0
208.0
130.0
103.0
442.0
18.2
93.6
624.0
260.0
197.6
130.0
130.0
270.4
150.8
77.0
91.0
27.0
260.0
546.0
135.2
19.5
51.5
221.0
8.2
14.0
249.6
189.8
59.3
58.5
65.0
67.6
60.3
15.4
39.0
14.6
260.0
234.0
72.8
110.5
51.5
221.0
10.0
79.6
374.4
70.2
138.3
71.5
65.0
202.8
90.5
61.6
70.0%
65.0%
50.0%
70.0%
65.0%
15.0%
50.0%
50.0%
45.0%
15.0%
40.0%
73.0%
30.0%
45.0%
50.0%
25.0%
40.0%
20.0%
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What is a ‘Need State’?
• A multi-dimensional, multi-category shopper requirement and a
unifying emotional attitude creating a compelling desire for a
superior comprehensive solution.
• Meeting the needs of a baby is one of the most complex and
powerful of all need states because it’s multi-dimensional,
continuous and highly emotional.
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The need states where the grocer can
win are tied to the perimeter
and often to protein
FAMILY DINING
PICNIC/COOKOUT
CULTURAL CUISINE
NATURAL/ORGANIC
WEIGHT CONTROL
VALUE
HEALTH & WELLNESS
TIME SAVING
FRESHNESS
GLUTEN FREE
HOLIDAY CELEBRATION
CARRIED LUNCH
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Bad News: No one prepared
Organizational
Challenges
Process
Challenges
Data
Challenges
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Organizational Challenges
Car
Seat
Baby
HBA
Baby
Food
Same need state but different categories
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Process Challenges
Category
Definition
•
•
•
•
•
Category Role
Category
Assessment
Category
Scorecard
Category
Strategy
Category
Tactics
Plan
Implementation
What is the need state marketing process?
Who owns it? The retailer? One manufacturer?
Who develops need state insights?
How develop need state insights?
How develop the Voice of the Need State?
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Data Challenges
•
•
•
•
Who creates need state standards?
What is analytical protocol?
How prioritize?
Which category drives the retail choice?
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How To Win in the Future
• By moving
– Beyond Category Management
– Beyond Shopper Marketing
– To….Need State Management
Category
Management
Shopper
Need State
Management
Shopper
Marketing
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