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Anton Xavier

By: Anton Xavier on October 9th, 2018

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CatMan - How to Enable Growth in a Transparency-Focused Market

category management

Growth in High-Order Attributes

Studies indicate shoppers are rewarding transparency. Seventy-four percent of shoppers claims they would switch to a more transparent brand (FMI & Label Insight - The Transparency Imperative). As evidence, brands with digital SmartLabel pages that enable digital labeling transparency have grown by 10.7% over the last 52 weeks in a number of categories that are either flat or declining.

 

“Most major brands and retailers are losing share, volume, or margins, sometimes all three.Gordon Wade, CatMan + Transparency

 

Even though the outlook overall is challenging, there are several areas where growth is significantly outperforming the rest of the market. Niche opportunities that are being grasped by small innovative companies who are quick to profit from the changing consumer demands. Launching products that cater to very specific needs, grasping an early adopter share of the market, and then riding that up to the mainstream.

This growth is occurring because transparency enables the shopper’s desire to avoid or acquire specific product attributes for personal reasons ranging from health and wellness to deeply held ethical values. Just in the past year, products claiming to be “free from” a specific negatively-perceived attribute have grown as much as 6% in large categories such as pet food and cosmetics.

 

“Higher-level attribution helps a Category Manager to better identify shopper trends and needs,” Tom McDonald, Team Leader of Best Practices and Chairman of the Advisory Board for CMA

 

CatMan 2.0 and Transparency

Category Management can arguably be stated as one of the most important business processes developed in the 21st century, and is deployed by leading manufacturers and retailers across the globe to great effect. The CatMan 2.0(™) process was developed to embody “the advances that have emerged over in data, analytics, process and success models as well as all the game-changing influence of the digital revolution.” (Category Management Association)

The 2.0 process involves both internal and collaborative stages between the brand and the retailer, and results in a category management plan that that drives execution. The diagram below outlines the steps that the typical CatMan 2.0 process goes through to get to an end deliverable.

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Gordon Wade, formerly the senior vice president for best practices for the CMA, makes the argument in the CatMan + Transparency white paper that it is possible to address transparency throughout almost every step of the CatMan2.0 process. As Mr. Wade states, CatMan 2.0 now needs to address the complexities and opportunities of transparency and the shift towards attribute driven buying behavior.

In CatMan + Transparency white paper, Mr. Wade goes on to break down every step in the CatMan 2.0 process and describe how the process can be evolved to the inclusion of high-order attribute data. Identifying how eventually, transparency through the incorporation of high-order attribute data can fundamentally evolve the whole practice of CatMan 2.0.

For example, Mr. Wade discusses how presently there is a division between Brands and Retailers regarding the high-order attributes that they consider relevant to a single product. At Label Insight, we see this challenge every day, where every retailer we work with has a different set of high-order attributes that they consider relevant. This places brands in the compromising position of needing to understand how each retailer sees a category differently. It’s hard enough to have alignment with a single retailer across a single category, but even harder when each retailer uses different high-order attributes.

The solution to this is shared visibility into what attributes retailers consider important, and the distribution of those attributes across a category. From a shared view, retailers and their suppliers can better align and begin the CatMan 2.0 process.

 

High-Order attributes key to unlocking CatMan future

The conclusion is clear long before the end of the white paper. The implications of high-order attribute data to the CatMan 2.0 process is critical to the success of CatMan 2.0 meeting the needs of the demand for transparency. Many of the predictions that we see for the potential future of Category Management; increased collaboration, personalization, reinventing the customer experience, require high-order attribute data to become a reality. Collaboration between retailers and their suppliers requires visibility of the unique high-order attributes that a retailer considers important to engage their shoppers. Personalization requires an understanding of the high-order attributes that are driving new decision making — the “Why” behind the buy. hen, ultimately helping shoppers to find the types of products they are looking for when their searching is being defined by attributes, requires high-order attribute data.

It’s not hard to argue that the lack of high-order attribute data in the market is holding back the back the future of Category Management. Check out the white paper to get an in-depth understanding of this position.

 

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Other posts in this series:

1 - Understanding the impact of High Order Attributes on the CPG Industry

2 - How Catman Enables growth in a Transparency Market

3 - Transparency’s Opportunity & Challenge for retailers

4 - Attribute driven market inverts the Category Decision Tree?

About Anton Xavier

Anton Xavier is a Co-Founder of Label Insight. With experience in management, operations and marketing, Anton has led the Label Insight team from its inception in Australia and subsequent move to the US, to its current position as a market leading, cloud-based product data engine. Completing postgraduate degrees in Australia, Anton gained invaluable management and marketing experience working with a variety of firms in Asia.