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WILTON, Conn. -- Category management is not just for grocery anymore. Indeed, just as many c-store retailers place a high degree of importance on the practice and many other channels are even more excited about category management than grocers, said Cannondale Associates in its 2007 Category Management Benchmarking Study.
The consulting firm, based here, referred to today's version of category management as "Consumer Marketing at Retail (CMAR)." It described CMAR as focusing on the translation of consumer insights to retail action and broadening its reach from one category to an aisle, section or occasion.
Cannondale's latest category management benchmarking effort found that a wide range of retail channels is now embracing the practice of CMAR, and that alternative players are witnessing strong returns as a result.
For the last 10 years, approximately three-fourths of manufacturer and retailer respondents to the Cannondale study have rated CMAR/category management as highly important, the firm said.
This year's findings showed other types of retailers giving greater importance to CMAR/category management than grocery. For instance, 100 percent of drug store retailers surveyed said the practice is very important to them. Likewise 92 percent of club/dollar store retailers agreed. However, just 79 percent of grocery retailers agreed.
Top industry players are engaging in a collaborative approach to CMAR, leveraging the strengths of their trading partners to create better solutions for the consumer, the report finds.
These companies also are seeing results. This year, both manufacturers and retailers reported double-digit sales gains from CMAR/category management. Manufacturers attributed 12 percent growth to CMAR activities, and retailers attributed 19 percent growth to CMAR. These results are especially dramatic in light of overall low single-digit growth in grocery, drug, club, and c-store channels.
Another finding from the report was that as shoppers continue to seek new and better shopping experiences, retailers are feeling more pressure to differentiate their stores. Consequently, leading manufacturers and retailers are adopting CMAR to differentiate from the competition.
"Knowing the retailers' shoppers -- thoroughly understanding their occasions for shopping, their reasons for choosing a specific store, how they shop, and what they're seeking -- is the core of CMAR," Bob Hilarides, a managing director at Cannondale, said in a statement. "Translating this knowledge into actions at retail -- tailored to the consumer segment, retailer and type of trips -- is key to successful differentiation and performance."
Cannondale's report outlines four action steps for retailers and manufacturers:
-- Train organization in active listening skills;
-- Translate shopper insights into retailer actions;
-- Invest in consumer understanding and expand scope beyond the category;
-- Integrate partner, shopper and consumer insights for differentiated strategies.