Cm Shavya n Aashu

8/2/2019 Cm Shavya n Aashu

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APPLICATION OF CATEGORY MANAGEMENT

PRINCIPLES

SUBMITTED TO:

Mrs. Ritu Malhotra

SUBMITTED BY:

Shavya Taneja 05

Ashish Kumar 25

NATIONAL INSTITUTE OF FASHION TECHNOLOGY, KOLKATA

CATEGORY MANAGEMENT



Category management is a retailing concept in which the range of products sold

by a retailer is broken down into discrete groups of similar or related products;

these groups are known as product categories (examples of grocery categories

might be: tinned fish, washing detergent, toothpastes). It is a systematic,

disciplined approach to managing a product category as a strategic business

unit.

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.

THE CATEGORY MANEGEMENT 8 STEP PROCESS

Introduction

http://en.wikipedia.org/wiki/File:8-step-process.gif



Lifestyle International (P) Ltd, part of the prestigious Dubai based Landmark Group,

started its operations in India with the launch of the first Lifestyle store in Chennai in 1999.

In little over a decade’s time, Lifestyle has established itself amongst the leading retail

companies in India. Positioned as a youthful, stylish and a vibrant brand, Lifestyle offers its

customers not just the ease of shopping but also an enjoyable shopping experience. Each

Lifestyle store brings together five concepts under one roof – Apparel, Footwear,

Children’s Wear & Toys, Furniture & Home Furnishings, Personal Grooming - offering a

convenience of a one-stop shop and a wide choice of national & international brands.

Home Centre by Lifestyle is a one stop destination for Furniture, Home Décor and Soft

Furnishings that truly represent style, comfort and individuality. Home Centre uses a

unique ‘Concept Room’ display model to give customers a practical idea of how each piece

of furniture would look in a particular room.

In keeping with the Group’s tradition of making every shopping experience rewarding and

memorable, The Inner Circle – Landmark Group’s Loyalty program allows members, to

enjoy exclusive benefits and privileges such as reward points and exciting offers. The Inner

Circle is today recognized amongst the leading Loyalty Program in the country with an

ever increasing base of customers. The card is accepted across all Landmark Group Stores

in India including Lifestyle, Home Centre by Lifestyle, Max Fashion, Splash, Bossini,

SPAR Hypermarket, Polynation Food Court, Gloria Jean’s Coffees & The Yellow Chilli

chain of restaurants.

Lifestyle and Home Centre offer a truly international shopping experience, a fact borne by

numerous accolades:



• Most Admired Large Format Fashion Retailer– Images Fashion Awards 2011

• Most Admired Retailer of the Year - Home & Interiors Category for Home Centre

by Lifestyle from Images Retail for two consecutive years, 2009 & 2010

• ‘Most Respected Company in the Retail Sector’ by Business World – IMRB in

2003 and 2004.

• ‘ICICI – KSA Technopak Award for Retail Excellence’ in 2005

• Lycra Images Fashion Awards for the ‘Most Admired Large Format Retailer of the

Year’ in 2006.

• ‘Reid and Taylor’ Retailer of the Year award for the year 2006

• Most Admired Retailer of the Year – Department Store’ from Images Retail in

2008

CATEGORY : MENS ETHNIC WEAR



Step 1 - Category Definition

The category does not see high volume of sales but the margins in this category are

high.This section occupies approx 200 sqft of space.

Step 2 - Category Role

This category does not see high volume of sales but the margins in this category are high.

This category fulfills occasional, exclusive requirements and the prices for this category

range from Rs 799 – Rs 5000.

Destination category – Ocassional/Seasonal Category.

Step 3 - Category Assessment –

Market share

Sleepers –

• Kurta pyjamas

Winners –

• Short kurtas

• Long kurtas

Questionable

• Sherwanis

• saafa

Opportunities –

• Jodhpuri suits

Market Growth

Manyawar , a premium brand at Lifestyle occupies a set shelf space that the brand has

purchased for itself.

Their hot sellers are Kurta pyjamas and the space allocation is comparatively higher than

other categories.



Sizes, L & XL have the highest stocks. M is comparatively lower and S is the least.

Melange, an exclusive store brand has high assortment has higher space allocation.

Most kurtas are hung on waterfalls with medium sizes displayed in the front and

successively – L, XL, XXL & S. While the pyjamas are placed on the bottom shelves.

Step 4 –Performance Measures

Short & Long Kurtas have the highest growth share matrix and are promoted extensively.

Step 5 –Category Strategies

There is a clear propogation of store brands, viz – Melange which has higher space

allocation.

Long kurtas are stocked to the maximum as their growth and demand is higher and also

compared to Sherwanis and Jodhpuri suits, they have lesser occasional use.

Large (L) size is stocked and displayed most, approx 3 Large pieces in each design are

displayed.

Step 6 – Category review

This category does not contribute to a large proportion of the revenue generated from the

mens wear line.

The space allocated to it is lesser than the space allocated for women’s ethnic wear.

CATEGORY : WOMEN’S ETHNIC WEAR

Step 1 –Category Definition



CATEG

ORY

SUB

-CATEG

ORY

SEGMENTS

(BRANDS)

SUB -SEGMENTS SIZES

Womens

wear

Ethnic • Biba

• Neerus

• Leffet

• Mélange

(store

exclusive

brand)

• W

• Maahi

• Harra

• Isvarah

• Prafful

• Span

• Short

kurtis(cotton

and cotton

blends)

• Long

kurtis(cotton

& cotton

blends)

• Leggings

(cotton)

• Salwar kameez

suits

(cotton,cotton

belnd &

synthetic)

• Salwars

• XS

• S

• M

• L

• XL

• XXL

This category occupies approx 300 sqft of space and is a high demand category.

Step 2 –Category Role

This category sees high volume of sales and margins in this category are medium - high.





It is considered as A Destination category

Step 3 – Category Assessment

Sleepers –

(None)

Winners

• Leggings

• Long kurtis

• Suits

Questionable

• Salwars

Opportunities

• Short kurtis

Melange, W, Biba and Neerus have the highest shelf space allocation.

Melange is a store brand & has considerably lower prices, it occupies two different spaces

in the ethnic area. One space is for discounted merchandise and lower quality fabrics that

are placed on shelves in the centre and the other display is with the use of waterfalls and

other hangers for higher priced merchandise.

The other brands are given a fixed space to display their products of which – W, Biba, and

Neerus are given a higher space allocation.

The merchandise is displayed according to the brands & separate space is given for all

brands to place their low priced merchandise which is hot selling and everyday wear.

Step 4 – Performance Measures



Leggings and Long kurtis have the highest growth share matrix and are promoted

extensively.

Step 5 -Category Strategies

The strategies adopted by the women’s ethnic wear line are –

• Placement of discounted merchandise in the centre on a tier table to attract

customer and sell more.

• Merchandise is stocked brand – wise.

Step 6 –Category review

This is one of the most popular categories of Lifestyle, it is on the ground floor after the

Women’s casual wear section. It contributes to a large share of the profits.

CATEGORY : WOMENS CASUAL WEAR



CATEG

ORY

SUB

-CATEG

ORY

SEGMENTS

(BRANDS)

SUB -SEGMENTS SIZES

Womens

wear

Casual • Forever

New

• Bossini

• 109 F

• Remanika

• Ginger

(exclusive

store

brand)

• Benetton

• AND

• Fame

Forever(ex

clusive

store

brand)

• Levis

• Tee shirts

• Tops

• Three-fourth

lowers

• Shorts

• Skirts

• Tops

• Spaghetti tops

• Full lowers

• Tracks

• Sweaters ,

scarves, socks

• Short Dresses

• XS

• S

• M

• L

• XL

• XXL

Step 1 - Category Definition



The category sees the highest volume of sales..

• This section occupies approx 500 sqft of space.

• Ginger & Fame forever are the 2 store brands in this category.

Step 2 - Category Role

This category sees high volume of sales and margins in this category are medium.



Step 3 - Category Assessment

Sleepers –

• scarves

Winners

• Tee shirts

• Tops

• Shorts

• Skirts

• Spaghetti tops

• Tracks

• Dresses

• Three-fourth lowers

• Full lowers

Questionable

• socks

Opportunities

• Short dresses(seasonal)

• Sweaters(seasonal)

Ginger(store brand) has the highest space allocation.



Fame forever, Remanika, 109 F and AND all have 3-4 shevles and display units allocated

to them.

Benetton, Bossini and Levis have a separate shop-in-shop space allocation.

Within each brand, every category is divided on the basis of its sub segments, viz, tops, tee

shirts ,socks etc

Sizes are placed from XS to XL in ascending order.

Every item is displayed on a waterfall in a medium size and its other size variants are

placed on a shelf.

Medium is the size placed most on shelves.

Step 4 – Performance Measures

Tee shirts and tops have the highest shelf space.

Sweaters ,during season, are fast selling and their growth is rapidly moving.

Step 5 -Category Strategies

The strategies adopted by the women’s casual wear line are –

Every item is displayed on a waterfall in a medium size and its other size variants are

placed on a shelf.

Medium is the size placed most on shelves.

Step 6 –Category review

This is the most popular category at Lifestyle, it is on the ground floor. Its volumes are

very high and it generates highest turnover.

PARTY WEAR



STEP I - DEFINING THE CATEGORY ROLE

Category : Apparel

Sub- Category : Men’s wear

Segments : Party Wear

Sub-Segments : Jackets, Shirts, semi formal t-Shirts

Category : Apparel

Sub – Category : Women’s Wear

Segments : Party Wear

Sub- Segments : Blouses, Tops, Tunics, Shrugs, Jackets, Leggings , Dresses, Stole’s

STEP II – DEFINING THE CATEGORY ROLE

OCCASIONAL/ SEASONAL CATEGORY – are those that are purchased infrequently

or follow cynical patterns. It helps to re-inforce the target customers image of the retailer

with the aim of frequent, competitive value to the target customer. Around 15- 20 % of

Lifestyle’s categories are managed with this role.

This category is of medium importance to the target customer as it is occasionally

purchased. Lifestyle also gives this category medium importance as they stock a limited

amount of Party wear. When it comes to Lifestyles competitors (shoppers Stop,

Pantaloons) this category is not given much importance as Party wear is an occasional

category.



STEP III CATEGORY ASSESSMENT- the current performance of the category is

evaluated with respect to turnover, profits and return on assets in this category.

Key factors which influence Consumer Assessment :

• The consumers buy ‘Party wear’ because it fulfils their need to dress well for

occasions . Occasion wear requires a person to dress in a more stylish and special

manner.

• Consumers are influenced by the need to dress in a special and stylish manner.

Parties are a special occasions where people put in more effort to look their best. A

persons social cycle plays a key role in influencing what he or she wears.

• While selecting party wear, a consumer scans through the entire range. He/she is

very fussy about the colour, fit and style. As it a special occasion, the consumer is

fussy about buying party wear and party wear is also priced higher so the consumer

puts in a lot of effort into selecting party wear.

Key factors which influence the assessment of the market are :

• Competitors of party wear (Shopper’s Stop, Pantaloons) offer a similar price

range as Lifestyle

• In terms of consumption and sales, this segment has low sales but at higher

prices per unit. Party wear is infrequently purchased.

• Lifestyle under its private labels (code,Fame Forever, Remanika & AND)

stocks a low range of party wear.



STEP IV – CATEGORY PERFORMANCE MEASURES

This step involves setting measurable targets in terms of sales, Margins, GM Return On

Investment. These need to be established for measuring category performance.

The sales for Party wear when compared to the other departments is comparatively lesser ,

hence the space allocated to party wear is minimum.

The assortment carried y Lifestyle for Party wear doesn’t contain every size. The

replenishment for party wear is poor and only few sizes are available for merchandise in

this segment. The new products introduced for this segment is also lower compared to the

other segments.

STEP V – CATEGORY STRATEGIES

It is the step in the category business planning process when strategies are developed to

deliver the category role and category performance targets. Strategies may relate to

marketing and product supply strategies. The strategies used here are :

• Transaction strategy : these maybe subject to impulse purchase and increase the

average transaction in the basket or category

• Cash generating Strategy : - uses parts of the category to generate cash flow, has

low inventory turnover.

• Excitement Creating Strategy : frequent change in products and seasonal products

where a sense of urgency is created.

STEP VI - CATEGORY TACTICS

Work towards determining optimal category pricing, promotion, assortment and shelf

management which are necessary to achieve the agreed-on role, scorecard and strategies.

Since the consumers needs are lesser in this segment, the variety in has low penetration ,

the prices are high , assortments are not complete and all sizes are unavailable.



SPORTS WEAR

Category : Apparel

Sub- Category : Men’s wear

Segments : Sports Wear

Sub-Segments : tee-shirts, track pants, sweatshirts, jackets, shorts, boxers.

STEP II – DEFINING THE CATEGORY ROLE

OCCASIONAL CATEGORY – are those that are purchased infrequently or follow

cynical patterns. It helps to re-inforce the target customers image of the retailer with theaim of frequent, competitive value to the target customer. Around 15- 20 % of this category

is stocked by Lifestyle.

This category is of medium importance to the target customer as it is occasionally

purchased. Lifestyle also gives this category medium importance as they stock a limited

amount of Sports wear. This category is not given much importance compared to other

men’s wear categories. The area allotted to sports wear is only 800 – 1000 sqft in the entire

men’s department.

STEP III CATEGORY ASSESSMENT- the current performance of the category is

evaluated with respect to turnover, profits and return on assets in this category.

Key factors which influence Consumer Assessment :

• the consumers buy Sports wear because it is a necessity for people who indulge in a

lot of sports and activities. It provides the perfect and comfortable fit and ease for

those playing a certain type of sport. Also some people buy sports wear if they’re

fans of a particular sport. E.g football jerseys.



• Consumers are influenced by their need for this type of garment as it provides ease,

comfort and fit. Also they are influenced by the various seasons for various sports

e.g IPL for cricket.

• While selecting sports wear a consumer looks for the apparel in relation to the kind

of sport he plays and need. Then he tried on the garment for size, fit, comfort and

other factors.

Key factors which influence the assessment of the market are :

• Competitors offer lesser range of sports wear than lifestyle

• In terms of consumption and sales, this segment has low sales but at high prices

per unit. Sports wear is purchased based on need, hence infrequently.

• Under private labels lifestyle has a small portion of sports wear but they also

have many shop in shops for various big sports wear brands such as Adidas,

Nike,Kappa, U.S Polo, Puma.

STEP IV – CATEGORY PERFORMANCE MEASURES

This step involves setting measurable targets in terms of sales , Margins, GM Return On

Investment. These need to be established for measuring category performance.

The sales for Sports wear when compared to the other departments such as formal &

Informal is comparatively lesser , hence the space allocated to Sports wear is minimum.

The assortment carried by Lifestyle for Sports wear contains almost every size. The

replenishment for party wear is good and Size set S,M,L and XL are available in almost

every style. Each brand stocks a good amount of merchandise and a wide range.

Competition is high and variety is large.



STEP V – CATEGORY STRATEGIES

It is the step in the category business planning process when strategies are developed to

deliver the category role and category performance targets. Strategies may relate to

marketing and product supply strategies. The strategies used here are :

• Transaction strategy : these maybe subject to impulse purchase and increase the

average transaction in the basket or category

• Cash generating Strategy : - uses parts of the category to generate cash flow, has

low inventory turnover.

• Excitement Creating Strategy : frequent change in products and seasonal products

where a sense of urgency is created.

STEP VI - CATEGORY TACTICS

Work towards determining optimal category pricing, promotion, assortment and shelf

management which are necessary to achieve the agreed-on role, scorecard and strategies.

The consumer expects a wide range with all size sets in the sports category. Also duringvarious sports season, the consumer expects adequate stock in all size sets and appropriate

merchandise. The pricing for this range is moderate to high, the merchandise assortment is

high and shelves are well stock with a wide assortment and almost all size sets.

BRANDS AND CATEGORIES



Brand Sub-Category Available Sizes Avaiable

Fame Forever Tees, Tracks, boxers,FIFA

collection

M,L,XL

U.S Polo Tees, Tracks, Caps S,M,L,XL

Kappa Tees, Tracks S,M,L,XL

Nike Shorts, Tracks, chest print

tees, socks, sweatshirts

S,M,L,XL

Proline Tees, tracks M,L,XL

Adidas Tees, Sweatshits,Tracks S,M,L,Xl

Puma Chest print tees, tracks,

socks,shorts,caps

M,L,XL

Space Allocated to Sports wear – 20 % of Space in Men’s Wear Department

Cm Shavya n Aashu

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