These will typically include share of shelf and planogram compliance (the specific placement of products on a store shelf).
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So without any further ado, let's take a look at these new startups: CoolR is tackling the CPG retail and beverage industries with a machine learning platform that's meant to not only track inventory and shelf performance but also detect planogram non-compliance, foreign products and pricing inconsistencies.
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The planogram concept originated with KMart. Planograms are created with the help of planogramming software by a Planogram Specialist, Space Planning Specialist or Space Planning Manager. The retail industry utilizes software to ensure proper stocking. Retailers turn to planogram software to reflect each store’s particular customer profile and localized demand, while maintaining centralized control and supply chain efficiency.
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Example of a planogram featuring textile products Planograms, also known as plano-grams, plan-o-grams, schematics and POGs, are visual representations of a store's products or services on display. They are considered a tool for visual merchandising. According to the Oxford English Dictionary, a planogram "is a diagram or model that indicates the placement of retail products on shelves in order to maximize sales." The effectiveness of the planogram can be measured by the sales volume generated from the specific area being diagramed.
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A floor map helps visual merchandisers to find the best place for garments, according to the color stories of clothes and footwear in the shop. It is a kind of floor plan with merchandise marked. Another valuable tool is a planogram, to determine the visual look of your store's flow.
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Shopper marketing may be included in trade marketing, therefore the shopper being another target for trade marketing managers, while it can also be considered as a separate discipline. Some of the activities to increase demand at shopper level include setting the right planogram, price announcements such as inserts, use of point of purchase materials, alternatively called promotional material.
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Vertical product placement puts products on more than one shelf level to achieve – of placement space. Similar products are placed in blocks. A planogram can be compared to a book. A store is the book and its individual modules represent the pages. The customer gradually “reads” individual modules and automatically proceeds from the left to the right, from the top to the bottom as if he/she read a book.
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Planograms are predominantly used in retail businesses. A planogram defines the location and quantity of products to be placed on display. The rules and theories for creating planograms are set under the terms of merchandising. For example, given limited shelf space, a vendor may prefer to provide a wide assortment of products, or may limit the assortment but increase the facings of each product to avoid stock-outs.
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Manufacturers often send planograms to stores ahead of new product shipments. This is useful when a vendor wants retail displays in multiple store locations to have the same look and feel. Often, a consumer goods manufacturer releases a planogram with each new product to show how the product can relate to existing products. Fast-moving consumer goods organizations and supermarkets mostly use text and box-based planograms to optimize shelf space, inventory turns and profit margins.
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One key reason for the introduction of category management was the retailers' desire for suppliers to add value to their (i.e. the retailer's) business rather than just the supplier's own. For example, in a category containing brands A and B, the situation could arise such that every time brand A promoted its products, the sales of brand B would go down by the amount that brand A would increase, resulting in no net gain for the retailer. The introduction of category management imposed the condition that all actions undertaken, such as new promotions, new products, re-vamped planogram / schematics, shopper and consumer insights, and the introduction of point of sale advertising etc.
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Each category is run as a "mini business" (business unit) in its own right, with its own set of turnover and/or profitability targets and strategies. Introduction of Category Management in a business tends to alter the relationship between retailer and supplier: instead of the traditional adversarial relationship, the relationship moves to one of collaboration, with exchange of information, sharing of data and joint business building. The focus of all supplier negotiations is the effect on turnover of the category as whole, not just the sales of individual products. Suppliers are expected, indeed in many cases mandated, to only suggest new product introductions, a new planogram or promotional activity if it is expected to have a beneficial effect on the turnover or profit of the total category and be beneficial to the shoppers of that category.
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