A successful retailer drives promising sales conversion with the right assortment offerings to its target market. Assortment planning plays a critical role in retail strategy planning, focusing on one of the marketing mix, Product element. 

Identifying the right assortment mix simply means understanding your target market well, in terms of their buying behavior and preferences. A thorough understanding of the target market behavior lays a strong foundation to formulate assortment planning strategies to achieve desired sales conversion. 

Multiple factors contribute to a well-thought assortment strategy for the business, and this could be supplemented by using both internal and external data insights such as understanding own brand product offerings and performance, competitor offerings, customer behavior etc. 

Internal performance review sets the tone for an effective assortment plan, to gauge a thorough understanding of the brand product positioning and performance. Here are the initial recommended steps to perform internal performance review:- 

  1. Establish own brand target segment
  2. Understand target segment buying preferences and buying behavior
  3. Develop a customer analysis 
  4. Review own brand top 3 (and/or potential) categories and subcategories

Subsequently, research on external factors is crucial in supplementing the internal performance review to spot any white spots relevant to your own business. 

Here are the recommended steps to breakdown these factors to formulate an effective assortment plan using the dashboard:- 

  1. Review own brand top 3 (and/or potential) categories and subcategories
  2. Identify competitors’ top 3 (and/or potential) categories and subcategories
  3. Compare own brand vs competitors’ top 3 (and/or potential) categories and subcategories positioning and performance
  4. Review own brand bottom 3 (and/or risky) categories and subcategories
  5. Identify competitors’ bottom 3 (and/or risky) categories and subcategories
  6. Compare own brand vs competitors’ top 3 (and/or risky) categories and subcategories positioning and performance
  7. Re-assess own brand assortment positioning by understanding own brand Strength & Weaknesses
  8. Identify Opportunities & Threats for the coming season
  9. Re-establish new category mixes for the coming season

Having the visibility of how external data on competitor performance complements internal assortment review allows brand to:-

  • Establish a desirable Weekly Sales, Stock & Intake (WSSIs) target 
  • Optimise assortment sales mix over stock mix
  • Improve overall brand weeks cover
  • Reduce overall brand markdown (MD) percentage
  • Strengthen potential categories and/or SKUs Rate of Sales (ROS)
  • Drive new SKUs to claim as top 20 bestsellers 30 days upon launch
  • Improve team commercial decision making by gauging the success rate of redistribution of category mix using the dashboard
Conclusion

The combination of both external and internal assortment review is extremely important, as products are the core of any business in driving growth. A consistent internal assortment review provides clarity in the business growth in which the practice of monitoring and analysing periodic (monthly/weekly) report helps to make informed decisions in reaction to the fast-changing retail market stance.

We hope you found this article helpful! If you have any questions or would like to explore the Omnilytics dashboard further, feel free to reach out to your respective Client Success Manager.

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