Product assortment is a topic that a lot of retailers don’t pay attention to. Here is a blog post that explains why it is relevant and how you can get it.
The constant question that sticks in the mind of a retailer is that “how to determine the product to offer for sale?” The idea of keeping huge stocks of every product doesn’t work anymore, one needs to be smart with such choices now. You should know what the consumer wants? What factors will give you a competitive advantage?
Being a data first company helps you compete well. If you intend to invest your money and time wisely, “product assortment” is something you must know. Because now it’s not the old school product assortment anymore, it has changed. And it is the time that you implement these revolutionary changes to your business too.
The assortment is traditionally defined as the number of products offered within a single product category. Product assortment refers to the variety of products that a business makes or a retailer offers for sale.
It consist of following characteristics-
Breadth: The breadth of a company’s products, relates to the number of product lines a company produces or a retailer carries.
Length: This refers to the number of products in a particular product chain or line.
Depth: A product line’s depth relates to the different versions of the same product that may exist in each product line.
Consistency: Consistency is the degree to which the product lines relate to each other.
Confusing? Well, let’s just understand this further through an example of a brand. “Cadbury” for example. Cadbury has different product lines including chocolates, beverages, candies, gums etc. This becomes its breadth. Now, taking into account exclusively “chocolates “ as one product line.
In this case, there are a number of variants like dairy milk, 5star, Bournville etc. This becomes its length. Now you might have observed different versions of dairy milk like silk, fruit, and nut etc. This is the depth. Talking about consistency it is pretty evident that products like 5star, dairy milk, Bournville will be fairly more consistent with each other as compared to their consistency with the category of beverages.
Understanding the Context
In a practical context, what Product Assortment planning does for a business, is that it presents the most appropriate product mix to maximize your market share and product.
In today’s times, retailers need to deliver assortments of the kind that maintains equilibrium between consumer demand and maximization of profit.
In the current Omni-commerce market, product assortment planning must fulfill dual objectives. Firstly, It must address the consumer demands. And secondly, it should make the brand exclusive in the eyes of the customers.
How smart “product assortment planning” will help your business?
It establishes consumer driven approach
“When you focus on your consumers, the consumer responds.” It is a consumer driven market. Product assortment planning requires understanding consumer profile, their purchase history, what do they exactly browse about, which eventually helps you to understand the intrinsic desires of a consumer. This consumer driven product assortment makes the retailer an ultimate preference to a consumer i.e. offering them exactly what they want. Talking about personal business gains, it gives you the advantage to invest more in retailing the products that are in demand. It is a win-win situation for both consumers and retailers.
Understanding gap analytics
Do you know what’s the best part of a competitive space? It is the constant thrill to stand out. We already know it’s essential to understand our own game but it’s equally vital to grasp the game of your competitor. Gap Analytics shows where your assortment overlaps with that of a competitor and where you are a unique seller. An effective product assortment planning includes a deep understanding of gap analytics to keep you a step ahead in your game.
Dynamics of Market
Trends and tastes change faster than you can imagine. In addition to this, consumers have a global arena to choose from. Appropriate product assortment in the only solution to match with the vibes of the current trend.
Setting the price point
It is a hard task to maintain equilibrium while deciding the appropriate price point for any product. It must maximize profits and should also be considered satisfactory by the consumers.
Since product assortment involves intense analysis, consequently, it determines a price point
that is up to the standard market rate.
Builds opportunities
There are always two ways to do any task. There’s either a harder way to do it or a smarter way. With appropriate assortment planning, you not only get to set a goal but also a vision for the future. Analysis helps you to forecast future trends and demands. Also, an opportunity to take advantage by eradicating existing loopholes.
Product assortment Intelligence
Till now, you must have already established the amount of analysis that goes in enabling product assortment planning. Don’t you just wish that if there could be a way to completely atomize the entire analysis and directly take a leap to the breakthrough? Well, your wish just came true!
There are ways to completely automate this process through product assortment intelligence. Product assortment starts with accurate product data in from the competitor websites.
Once you have the data, you can use tools like PowerBI or Pentaho to get accurate product intelligence. Assortment intelligence reporting can then help a retailer determine competitor’s product performance. With the gained insight, a retailer can draft his/her own perfect product assortment plan that maximizes profit.
Some of the prominent automation of product assortment intelligence, are listed below-
Check and compare prices for identical product lines.
Find your own exclusive products, for which you may charge a higher price.
Check your own statistics in extremely systematic settings through charts, graphs etc.
Receive advanced analytics and proactive alerts.
Rectify your own shortcomings by analyzing the products your competitors have but you don’t.
Since the data is continuously analyzed and updated, this gives you a chance to move in pace with the ever-changing dynamics of the market.
Want the perfect product assortment intelligence service for your product? Datahut can provide you with most systematic, updated and customized data to find out product assortment intelligence to grow your business.