Category Planning (also referred to as Category Management) is a  retailing  and  purchasing concept. Primarily, it involves in breaking down the range of products into discrete groups of similar or related products. These groups are known as product categories. 

The ultimate goal of Category Planning is to obtain long-term improvements in the efficiencies of retailers which leads to increased sales, improved shopping environment and overall customer satisfaction. Fundamentally, this would begin by introducing hierarchies in each category. A categorical hierarchy means grouping of subcategories and products into a category. Hence, assigning a product to a categorical hierarchy will help to improve the performance analysis of a product. 

Refer the below snapshot which is an example of category planning model made on Microsoft Power BI with the help of ValQ. Here,what we see is that total sales are broken down into two categories viz. Corporate and Home Office. Furthermore, each of these sales categories are connected with respective subcategories and products. 

Category Planning Valq

Thus, as a category planner it is of paramount importance to understand the intricacies of category planning process. In the next blog we are going to throw some light on important steps to be considered in category planning process. Learn more here .

 

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