Tens of thousands of products, and thousands of new products on display. Tens of thousands of customers, and thousands of your best, loyal customers. How can you optimise your assortment and the shelf-space given to products so that they serve loyal customers as well as possible and also ensure good sales performance and earnings? This is the life and death question of hypermarket-size retail stores. The usual solution to this challenge is solid professionalism, experience and staying alert. But the pace is getting quicker. That is why more and more companies, especially the big global players, are employing analytics to help them.
Shelf-space optimisation is an analytics tool that synchronises different sets of data - product, new product, sales, customer, space, competitor and placement data - to optimise the use of space by shelf module. Thanks to detailed shelf images, the results of its analyses are easy to implement in shelf-stocking.
In practice, the path to optimal assortment and shelf division starts with a demand forecast that reflects the catchment area. Sales and earnings scenarios can be used to take into account not only the role of the new products that are offered but also the overall sales and financial impact of the solution. What is more, the model can use unstructured data, such as feedback from customer service and panel results, so that customer satisfaction can also be included in the analysis, not only by way of market baskets but also through perceptions. You will no longer need to worry that something is missing from your assortment, you can just let the data guide your actions.
It is all based on a chain-specific comprehensive view and uncompromising focus on individual stores. The shelf-space optimisation tool is based on the store layout and shelf modules, from product segments down to products, and it takes into consideration store-specific goals and focuses, the order in which products are encountered and the assortment.
Does this sound too good to be true? With growing product assortments, seasonal impacts on demand and new products flooding the store, harnessing analytics to your benefit is surely worth considering!