Finally, the last 2 Ps of category management - promotion and price.

With the digital shelf serving a variety of different shopper missions, a tailored promotional strategy can be a great opportunity to meet shopper needs, drive basket value and increase category profitability.

When you’re thinking about promotional strategies, you should consider whether there are any opportunities to run online-specific promotions. What about bundling certain products together to drive basket value within a category - or even across several different categories? Are there ways to drive impulse and repeat purchases, and can promotions be time-bound to make the most of peak traffic times? Think about how offers will be communicated through retail media and product content to maximize traffic and potential conversions.

It’s important to mention the fact that some omnichannel retailers might not want to differentiate promotional strategies across online and offline channels, and instead choose to prioritize a more consistent shopping experience. For example, a retailer might not be open to the idea of running a promotion in store that isn’t also available online.

You don’t want to spend time and resources putting together a plan that a retailer is going to immediately reject, so review your retailer’s strategy before you come up with any ideas.

Finally, price. The often high costs of eCommerce fulfillment can make retailer profitability more challenging, so when you’re assessing category pricing, you need to consider the value proposition carefully. Look for opportunities to drive more profitable product ranges, and weight of purchase - in other words, the number of items being added to online baskets. And, seek to find out whether category pricing strategies are being clearly communicated online, and what impact these have had on category performance.

Something to remember when it comes to category pricing, is that in many regions, competition laws place pricing entirely at the discretion of retailers - so category managers will need to bear this in mind when discussing pricing with their retail partners.

We’ve covered a lot of ground in this lesson, looking at how the digital shelf differs from the physical store and what this means for your approach to online category management. You should now have a good understanding of the basics around category management, and how to tackle some of the complexity that comes with operating on the digital shelf.

That’s all for this lesson. See you next time.

Promotion & Price