Today’s blog is about Product and all the factors associated with it.
The product (brand or SKU) placed in a store is extremely important. Even in the case of large retailers like Walmart or Tesco, not all stores are the same. Each store in a retail chain has a different mix of consumer demographics, dependent on location.
Size of store/store format is a factor that influences this ‘P’. Another factor is packaging and artwork.
For example, a convenience occasion focussed brand/brand extension with high sustainability credentials aimed at the AB demographic would be far better off launching in stores in & around the city than anywhere else in London.
Another example is stocking only single serve or sharing size SKUs in city convenience stores and stocking sharing, value added and multipacks in supermarket/hypermarket formats. This is dictated by space constraints in store and also at the homes of consumers.
Retailers typically divide their products into three categories:
- Core items that customers always expect you to have in stock and ready for them to buy;
- Line extensions which are different options to the core product;
- Related products or services that make the initial purchase work better.
On-shelf availability is a key factor for this ‘P’. The consumer should be able to find the brand/SKU they want, whenever they want it. This relates directly to the ‘out of sight, out of mind’ principle.
If a consumer does not find the brand/SKU they want, they will look for a different brand or even a substitute. This leads directly to not just a loss of sale, but also to a share loss.
In the lead up to next week’s blog on the 2nd P, Place, we would be remiss in not mentioning new product launches. New brand launches or product extensions should be in stores where the target consumer is most likely to buy or sample it. These new SKUs or brands should be in high visibility areas in store and if relevant, with complementary products. Eg. new dip brands or flavours placed next to chips/crisps or in the snacking section. More on this next week!
If you’d like to learn more about the first P, Product and getting your KPIs to a healthy place, email us on firstname.lastname@example.org.