Mott's is exploring an occasion-based category management concept to help its retail customers offer a consumer solution that could increase the transaction size.
The company is evaluating the potential of a summer party aisle, in which associated products -- like charcoal, paper plates, napkins and Mott's cocktail mixers -- would be merchandised together. The concept currently focuses on summer parties, but could easily branch out to other seasons and holidays.
"We're investigating the potential for it in terms of delivering added revenues to the customer," said Ray Passant, senior category manager, Mott's, the Stamford, Conn., subsidiary of London-based Cadbury Schweppes.
Mott's plan falls under what consulting firm Cannondale Associates, Wilton, Conn., calls Consumer Marketing at Retail. Cannondale says category management is "alive and well," but that there's been a focus on marketing, rather than just merchandising.
CMAR calls for driving incremental sales, and trading shoppers up to higher-value, higher-margin alternatives. Doing so requires more consumer insights, while managing "aisles," "occasions" and "solutions," not just categories.
While Mott's doesn't use the term CMAR, it supports the approach because its calls for making the shopping experience easier for consumers. Doing so could help retailers by spurring sales of associated products, said Passant.
Mott's acknowledges the importance of understanding consumers from a segmentation point of view in terms of the different types of consumers and their reasons, motivations and needs for buying particular items, said Passant.
"We need to look at usage occasions and consumer attitudes toward purchasing, not only in consumption terms, but also in terms of how a shopper shops at particular customers," Passant said.
Category management is an important component to Mott's overall go-to-market strategy, so much so that it's gaining more visibility, focus and resources, according to Passant.
"We see it as a way to differentiate ourselves in the marketplace, assuming that we develop capability in the areas our customers are looking for," said Passant.
The effort is just as important for other manufacturers. Seventy-five percent of manufacturers say category management is an "extremely" or a "very important industry" issue, a 5-point increase from 2001, according to Cannondale's 2002 category management industry benchmarking study.
Called "Evolution to Consumer Marketing at Retail," the study said the more successful category management practitioners are moving "away from the process-intensive eight-step approach," to a more "action and results-oriented approach."
Quaker Oats Co., Chicago, a division of PepsiCo, ranked No. 5 in the Top 10 practitioners, as rated by retailers, according to the study. Quaker's ranking improved the most of all the Top 10 manufacturers, with 9.8% of retailers ranking it as a leading manufacturer in category management, a 4.7-point increase from last year.
One of the reasons for its strong improvement was because of its CMAR-related breakfast study. Quaker used consumer insights to help retailers, who are losing breakfast sales to quick-service restaurants and outlets like Starbucks, market the breakfast occasion. "Quaker stepped back and looked at how consumers eat not just cereal, but breakfast in general. Doing so required consumer insights," said Don Stuart, partner, Cannondale. Quaker officials were unavailable for comment.
Stuart also pointed to aisle-management efforts in other parts of the store. Gerber Products Co., for instance, recently surveyed baby aisle customers about their shopping habits. The Fremont, Mich., manufacturer is now reportedly using the results to providing marketing recommendations to retailers. Suggestions include merchandising care and health and beauty care products between two anchor categories like food and formula, and putting diapers and wipes next to each other.