This paper has two parts: firstly, a general consideration of the theoretical and conceptual problems which researchers need to overcome if they are to provide retail management with useful findings in the major problem area of product range and line assortment selection; secondly, a report on a cross-sectional study of the responsiveness of 55 product groups to varying amounts of shelf space in British supermarkets.
The study reported here is the first in a series of reports on the market position of the major department stores and specialty chains in the women's fashion market. Unlike most previous studies, this report covers only one product class and all tables and charts covering attitudes and shopping behaviour refer to that single product class.
In this paper we consider, optimal allocation of shelf space over article groups by a mass retailer. To this end the general structure of a number of mathematical marketing models is developed. These "risk-evaluation" models allocate shelf space over article groups and account for the risk which is inherent in the choice of article groups. The models are based on models which are used in financial management to analyse and select portfolios. A couple of these models are tested and some future directions of research in this area are indicated.
This paper is aimed at exploring some of the forces that influence the retailer when he tries to compose or change his particular article range selection. In this, as I will endeavour to show, he has an only limited leeway and he is the child of his time, guided and goaded on specific paths that are laid out by historic developments and the change of data, like buying power, buying habits, dispersion of urban population, mass motorisation.
Determining the number of lines per range requires assortment decisions on the number of items and facings displayed in the stores. The constraint of limited shelf space and demand and cost interactions among the various products of the assortment must be considered. In many cases, retailers try to solve the problem by trial and error. An alternative is to conduct controlled experiments using experimental designs. They allow definite statements that have a known and controllable probability of being correct and consequently provide a reliable basis for decision-making. The testing procedure is illustrated by two case studies using latin square designs to answer the fundamental questions of adding/deleting a product and changing shelf space allocation.
This paper considers the reaction of retailers and manufacturers to economic constraint and in turn the reaction of consumers to these reactions.
There is not so much a conflict between "range" and "rationalization" as a need for balance between the two: a need to determine the "rational range". The starting point towards this goal is to allocate store space to grocery commodities in relation to their true contribution to the store's profit, taking account of the "space responsiveness" of these commodity groups to changes in space allocation and the store's overall marketing philosophy. Once the frozen food space allocation is determined the issue of the extent of the variety sold through that space may be tackled. Birds Eye has conducted fairly extensive research into these issues, closely examining the consumer's behaviour in the shop. Taking the consumer as the starting point, it is important to recognise that about half of all frozen food purchases are made on impulse. The frozen food display is the key area of consumer interest amongst self-service commodities. Wide variety is a very strong attraction to the impulse shopper, and the benefits of increased range may be quantified. The basic finding of our inventory management studies was that, provided adequate stock cover is maintained, more sales come from improving product variety than from enhancing display impact with additional facings of a lead line.
The result of this examination of the formation of range and assortment policies is to emphasise the variety of the factors that may be involved. There is a danger of advancing too fast to the stage of model-building. Where the problem is not a matter of routine, these factors should be surveyed fairly systematically, and where it is a matter of routine, the existence of a complicated background should at least be kept in mind.
With the help of the explorative method the knowledge of the housewives who buy in large self-service stores about their shop and their behaviour there were examined, with as underlying question, whether a study of behaviour in the shop is possible via this type of exploration. The individual hypotheses can be seen as having a purpose for further study on the basis of the data obtained.
A manufacturer who is aware of each Multiple's company philosophy is in a good position to present new products in the light of that knowledge, and to emphasise those aspects that will most readily attract a favourable response. But a company philosophy is by no means the most powerful of the influences that will determine the eventual acceptance or rejection of a new product. Other key factors involve the category into which the new product falls and what it can do for the multiple's position; the support factors such as the manufacturer's standing in the market; his relations with the trade, the presentation of the new product, the advertising support, and the packaging; and the deal itself, in particular, the price which tends to reflect the importance of the launch. Only the right combination of all these will secure retailer acceptance and what is 'right' will obviously vary from retailer to retailer.
For in-store designs one has to define a standard of measurement. In most cases it is no use to design something with the use of only one store. It is preferable to use a reasonable number of stores. Great attention should be paid to the unsolvable problem of comparability between stores. It is preferable to use the more simple research designs instead of the sophisticated ones, because if something goes wrong, and in most cases it does, one need not throw the full experiment away. One should try to design an experiment that takes exogenous factors into account like seasonal fluctuations, trends, etc. It pays to devote great attention to the human factor involved by motivating people who participate, but not too strongly. Rigid field control is an absolute necessity in order to reach honest evaluation.