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Case Study: Optimizing Assortment and Pricing

Issue
A Toy manufacturer noticed slowing sales in the Playsets category at one of its key retail accounts. While the Playsets category was posting solid results across the rest of the market, that retailer was seeing declining sales -- and declining market share – for the category. Analysis of the retailer’s performance vs. total market revealed that the retailer’s lost share of the business equaled $6 million.

Insight
Analysis of weekly sales data for the retailer vs. the total market revealed a steady decline for the retailer throughout the period. However, a closer look, down to the item level, revealed pockets of opportunity. By comparing sales activity at the specific retailer with sales activity across the rest of the market, NPD data revealed the most successful SKUs in the category, which were driving sales up at competing retailers. And by tracking weekly sales trends by price band, the manufacturer could see how competitive pricing activity was driving sales for these SKUs.

Action
Armed with objective market intelligence, the manufacturer is better positioned to gain placement within the retailer through a collaborative selling strategy. The manufacturer will be helping their retailer partner optimize its assortment to include the winning SKUs at the optimal price points. By working as a team, they both stand to gain by increasing their category share.

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