One of the major themes of the IGD Category Management and Shopper Marketing Summit 2018 was how traditional markets are fragmenting. Markets that once appeared homogenous have split into new segments with their own distinct needs, requirements, and preferences. Retailers and suppliers need to respond to the new opportunities and pressures that this creates.
Ray Leung, IGD’s Category Capability Manager, has summed up the capabilities suppliers need to develop to become the first-choice category partners for retailers.
Shopper concerns and shopper behaviour
First let’s look at shopper sentiment. IGD’s All Shopper Survey runs in Autumn every year and offers an invaluable annual snapshot of their intentions and concerns. The last survey in 2017 showed that shopper concerns hadn’t changed much over the past year. The only major changes between 2016 and 2017 showed climate change increase as a concern and migration decrease.
Living costs and the British economy remain the major concerns for shoppers.
How concerned are you about the following?
If shopper’s concerns aren’t changing, the way they shop certainly is. Over 75% of shoppers regularly use more than four channels for shopping. Half use over five channels regularly and the channels they use vary depending on their mission.
Shopping missions conducted on last visit
Shoppers now expect omnichannel shopping, moving some of their shopping online while still visiting traditional brick and mortar stores.
What do retailers want in a supplier?
We asked retailers “what distinguishes a best-in-class supplier?
They told us best-in-class suppliers:
- have an in-depth understanding of the whole category and its future trends
- have an objective viewpoint and recommendations for improvement
- work with retailers to develop joint category plans
- launch innovations that contribute to category growth
- have a long-term vision beyond the current trading needs
Shoppers are shopping in more channels, on more varied missions. The challenge for retailers and suppliers is how to best reflect these changes in what they make, market, and sell.
Retailers expectations are evolving. They now expect suppliers to focus on the long-term and they want suppliers to offer a broader understanding of categories when they work together. Suppliers need to learn how to work with different retailers with varying expectations.
The five capabilities of a best-in-class supplier
It’s far from simple to become a best-in-class supplier, but the pay-off is the opportunity to become a category partner. Category partners get to help shape the future of a category with a retailer, and the rewards are potentially massive for both sides of the relationship.
To beat their competition, suppliers need to have the capabilities and resources to:
- consistently prioritise customers’ needs
- develop their future scenario planning
- work with retailers to build and execute category plans
- execute solutions focused on shopper missions
- include category management and shopper marketing teams in new product development
How good is your category management? Use our online category management and shopper marketing survey to compare your company against out industry benchmarks.
How good is your category management and shopper marketing?
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