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Shelf Schematics Process and Principles

Shelf Schematics Process and Principles. Debi J. Besser, C.P.M Director of Purchasing. History. Previously managed through partnership with major suppliers Suppliers with leading brands in each category Category specialists: Segment captains and primary validators

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Shelf Schematics Process and Principles

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  1. Shelf SchematicsProcess and Principles Debi J. Besser, C.P.M Director of Purchasing

  2. History • Previously managed through partnership with major suppliers • Suppliers with leading brands in each category • Category specialists: Segment captains and primary validators • Strategy still based on industry best practice

  3. Why do it ourselves? • Faster revision cycle • Real-time product additions and deletions • Maintain the partnership with DRAW (Distillers’ Representatives Association of Washington) • Major reviews every six months • On-line availability

  4. Why do we care? • Customers were confused • Over 900 Spirit SKUs in an average Washington Store • Don’t understand the differences between products • Additional opportunities by making the spirit shelves easier to shop • Improved customer service • Increased profitability

  5. Principles Grouped stores in “clusters” How much: Days of product supply Where:Positioning priorities

  6. All Stores are Created Exactly Equal Stores Clustered into Distinct Groups • Creates a Manageable Framework • More efficient than store by store • Meets shoppers needs better than all stores created equal Why Use Store Clustering? The Marketing Continuum Every Store Examined Independently No Upside Opportunity Doesn’t Meet Shoppers Needs Operational Nightmare Too Complex & Expensive

  7. Determining Clusters • Spectra CAM clustering Three distinct store groups were developed: • Cluster One………………..Rural • Cluster Two………….……Urban • Cluster Three…………….Suburban

  8. Rural Urban Suburban WSLCB Clusters

  9. Clusters The variations in demographics drive the distinctions between clusters: • Cluster 1 skews towards lower income and education levels, with a occupation skew towards service and blue collar jobs. Within this cluster, there is a larger than average Hispanic population. • Cluster 2 stores are mainly urban stores. This cluster has a propensity for higher income levels, skews towards households without kids. • Cluster 3 skews towards high income, highly educated, white collar households with children. These stores are mainly located in suburban areas.

  10. How much? • Clean SAM2 data • 52 week average movement • Off Premise volume only • Specific to stores in cluster • Remove special packs and special orders • Enough facings to allow for minimum 14 days of product on shelf

  11. Where? • Positioning Principles • Category • Price Segment • Shelf level • More expensive to left • Sign Post Brands • Brand Family Blocking • Line Extensions • Sizes (small to large)

  12. Suburban Cluster Category Flowencouraging impulse purchases Front Enter here

  13. Positioning by Price Segment

  14. Sign Post Brands Use nationally known brands to identify a category to the consumer

  15. Brand Family Blocking Group products together by brand family

  16. More Positioning … • Line Extensions (8 yr., 16 yr, etc) • Product Size (small to large) • Price (low to high) Bourbon (top shelf) $59.95 $31.95 $22.95 $18.95

  17. Summary • Cluster stores by demographics and purchasing patterns • 14 days of supply of product • Positioning • Category • Price • Shelf level • More expensive to left • Sign Post Brands • Brand Family Blocking • Line Extensions • Sizes (small to large)

  18. Questions?

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