Grocery’s Next Gen of Category Captains

Grocery’s Next Gen of Category Captains

Grocery’s Next Gen of Category Captains 1440 428 Chute Gerdeman

Today, most retailers rely heavily on category captains to provide input and advise on shelf space allocation for other brands. As consumer demands call for a greater need for in-store relevance, there’s a call for a shift to an alternative category management, one with a shopper-centric approach.

Category captains earn their place and position based on their portfolio and category insights, but it’s never a permanent guarantee. As the market demands quicker turnarounds and response to consumer tastes and preferences, category captains are now being challenged to innovate and expand their leadership role even more.

You might be shocked to discover that many of today’s category management methods follow elements outlined in the 95’ Efficient Consumer Response initiative. In fact, a study by the Food Marketing Institute (FMI), Deloitte Consulting and Winston Weber Associates finds that 85 percent of retailers have made either “no change” or “moderate change” in the two decades since the ECR’s development. A lot has changed during that time and the market calls for smarter commerce from store level to basket level insights.

Recently, Kroger, the largest grocery chain in the United States, made a bold move to take control of its own shelves. The retailer hired a third party privately held distributor, Southern Wine & Spirits, to oversee the aisle allocation of beer, wine, and liquor brands across all of their stores. Aiming to be more responsive, Kroger plans to offer new craft brands gaining popular consumer interest, and make seasonal shifts to reflect consumer consumption patterns likes like light wines in the summer and deep reds in the winter.

One of the controversial components of this third party partnership came about in terms of monetary influence for slotting space. Southern Wine & Spirits has extended “voluntary contributions” from the manufacturers, which until now has always operated without an exchange of money.

While the decision has become a hot topic for debate, the big question is what does this mean for the future of grocery? What could the implications be for other categories? The next gen of category captains calls for a greater need for a mutually beneficial retail relationship. One of the essential pieces to the partnership is sharing data to manage the white space between retailer and consumer goods brands. In some cases, digitally based data like POS and loyalty insights are never shared with category captains. For consumer goods it could create an opportunity to understand what consumers are buying to identify new product and portfolio extensions that respond to consumer demands. In turn it benefits retailers to be able to deliver products that create interest for consumer traffic.

Takeaway: As category captains look to grow their presence and maintain their position in grocery they will need to ensure that they are aligned with evolving consumer preferences and adapting to the new change of pace at retail.

HOW WE THINK SETS US APART

A collection of insights research and observations across retail, restaurant, c-store and grocery. Helping brands provide a better experience for their customers. Enjoy.

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