Retailers, CPG Manufacturers Increasing Category Management Use
CHICAGO, Ill. -- New research released by ACNielsen U.S. indicates that retailers and consumer packaged goods (CPG) manufacturers are increasingly turning to category management to grow their businesses. The findings are included in ACNielsen's 13th Annual Survey of Trade Promotion Practices, which was released at the annual Food Marketing Institute (FMI) Conference in Chicago.
Asked which of several category management activities they included as part of their category management process in 2003, manufacturers and retailers reported increased use of almost every one. Among respondents who did not utilize a particular category management activity in 2003, micro-marketing and micro-merchandising activities -- where promotional efforts are developed for consumer segments based on their demographics and shopping behavior -- are the two that the highest percentage of manufacturers and retailers plan to begin using in 2004.
The growing interest in micro-marketing and micro-merchandising is not surprising, according to Rob Holland, ACNielsen senior vice president, Retail Marketing. "Marketing and merchandising techniques are becoming ever more narrowly focused, ever more precise. Marketers are finding it essential to become much more specific in how they define their customer segments and to tailor their promotional efforts to the unique needs of each segment," he said.
Asked about their motivations for using category management, 84 percent of manufacturers cited the opportunity to influence decisions on their categories, whereas the same percentage of retailers cited the opportunity to increase profitability.
The 13th Annual ACNielsen Survey of Trade Promotion Practices was conducted during February and March 2004. The results are based on answers to questions from retailers and manufacturers about trade promotion spending practices in 2003, as well as future trade promotion activities.
Asked which of several category management activities they included as part of their category management process in 2003, manufacturers and retailers reported increased use of almost every one. Among respondents who did not utilize a particular category management activity in 2003, micro-marketing and micro-merchandising activities -- where promotional efforts are developed for consumer segments based on their demographics and shopping behavior -- are the two that the highest percentage of manufacturers and retailers plan to begin using in 2004.
The growing interest in micro-marketing and micro-merchandising is not surprising, according to Rob Holland, ACNielsen senior vice president, Retail Marketing. "Marketing and merchandising techniques are becoming ever more narrowly focused, ever more precise. Marketers are finding it essential to become much more specific in how they define their customer segments and to tailor their promotional efforts to the unique needs of each segment," he said.
Asked about their motivations for using category management, 84 percent of manufacturers cited the opportunity to influence decisions on their categories, whereas the same percentage of retailers cited the opportunity to increase profitability.
The 13th Annual ACNielsen Survey of Trade Promotion Practices was conducted during February and March 2004. The results are based on answers to questions from retailers and manufacturers about trade promotion spending practices in 2003, as well as future trade promotion activities.