Category Captaincy is fundamentally the retailer off loading work it SHOULD be doing onto the shoulders of the manufacturer. The manufacturer, thinking that if they get a “seat at the table,” it will enhance their ability to influence their own brand’s results often jumps at the chance to participate. Every manufacturer should be held to the standard of providing objective unbiased insight, not just the captain. Every retailer’s Category Manager should know the dynamics of the category, the consumer, the competition, the market, etc. No retailer should ever hand over responsibility for category direction to a manufacturer – and the best retailers do not do that at all. The pursuit of including additional research, insight, perspectives is all well and good. But the retailer runs his or her business as he or she sees fit. The manufacturer does what can be done to meet the needs of the retailer, the market, the consumer, etc. — but the idea of a Category Captain without parameters is destined to fail for the retailer (and the consumer). The… Read more »

This is what I do for a living, and as such will be the first one to admit it is prone to corruption. It is a GOOD process when correctly managed. Validators are a necessary part of the process. That doesn’t mean management by committee, but having a second set of eyes to provide objectivity and keep everyone honest. When the Vendor Partner evaluates their employee bonuses on “Facings Gained” for the Vendor, you know you have a problem. The reality is this: Retailers should take this process in house. However, regardless of how big they are, there will never be the talent to understand each category and its nuances. Typically, there is a planogram department and they crank out production for the entire store. The Category Manager is supposed to provide the input. The two never mesh, and the Category Manager lacks the time, resources and experience to do a credible job creating a planogram. This is caused by frequent buyer rotation. There are exceptions. I had the pleasure of working with Wegmans. The… Read more »

Does anyone truly believe that a category captain would suggest major cutbacks of his/her employer’s brand? Great retailers assign talented buyers who do their own assortment planning. It’s fine for any brand to make suggestions and present analysis, and any reasonable buyer should consider suggestions. If a buyer hasn’t got the time to do the analysis needed, then the retail company either has too few skilled buyers, inadequate technology, and/or major management problems. Category captains can be helpful, but well-run retailers know where to draw the line.

As with most things, there’s good and bad. Some captains make presentations that very obviously have their own business at heart, and not the retailer’s. Some captains don’t come back with ideas that will help provide incremental growth and profits for the category. At worst, some captains may leak info to competitors (I think that hardly ever happens, but caution should always be there) or go over the buyer’s head to appeal a decision to cut items — when data shows that those items should go. Then, of course, some retailers don’t share their merchandising philosophies, perhaps out of competitive paranoia. But if the captain doesn’t know the retailers’ category roles and targets on SKU count, P&L, private label, linear feet, velocity and the usual measures that get plugged into software, they can’t be much help. Captains are also being asked to take on so many roles that weren’t part of the original bargain. Some retailers are asking for data/planograms not just for store clusters, but for individual stores. They’re being increasingly demanding, asking for… Read more »

I’ll go with the Bible on this one: “No man can serve two masters” (or whatever the exact quote is). It’s reasonable for a buyer to ask vendors questions and expect reasonably honest answers, but to expect a salesperson to stab his/her employer in the back is absurd.

The buyer should get ideas and info from all the vendors.

Fundamentally, gathering, analyzing and interpreting data about customer preferences should be a core competency of any successful retailer. However, the actual tasks involved are not as simple as that sentence implies. External data of almost any kind is economically difficult for any retailer to acquire at the subcategory level. Internal data, on the other hand, should be easily accessible and, given appropriate technology, relatively possible to interpret economically. Category captaincy arises from real constraints in the retail operating model. Gross margins, particularly in food retail, do not support the level of skilled personnel which would be required to track, analyze, interpret and act upon data at the SKU or subcategory level. Even with improvements in technology, it takes time to review even the best reports across the breadth of performance measures necessary to make completely informed decisions. Too much time. Also, as noted above, external data at that minute a level is simply beyond the profitability parameters of multi-category retailers to acquire and interpret. Let’s live beyond the ivory tower. These operating model realities are… Read more »

As an advisor, I have made recommendations to eliminate distribution on my company’s products where it was warranted.

My hope is that my company will listen to the voice of the retailer in those instances and truly innovate or renovate the product in order to regain future distribution.

Not all retailers (including the biggest) have the infrastructure in place to support information literacy at the buying desk. Most buyers have too much on their plates, buying several categories with insufficient time and reward for getting it done properly.

As an advisor, my role is assisting the navigation of tools, and information available and providing a succinct analysis complete with recommendations to the buyer. Should they question our integrity, we realize our careers are at stake. This is a small world, and too much is at risk to make any one-sided recommendations on behalf of my employer.

I hope Carol is wrong. I enjoy my role.

The quick response to whether category captaincy adds value to a retail partnership is “yes,” because the system encourages competition between the non-captains (called category validators) and the incumbent captain. That competition is based on bringing the best consumer insights into the category review process, which in theory delivers better value to the consumer. However, a key point is whether or not the category validators are able to enter their findings into the category review early enough in the process. If not, then the competitive nature of the system is compromised. It all depends on what and when opportunities are presented to the validators. Validators need the data management technology that gets their insights entered into the category review process faster and across more retail customers. Data automation is perhaps the most vital technology that gives both captains and validators a competitive edge. Data automation software, such as XP3, automates data loading, integration, segmentation, and calculation, and automatically generates updated presentations for field sales teams. With this technology, validators get their message out faster and… Read more »

I agree with David and predict that the reign of category captains is coming to an end, as is the era of vendor managed altogether. Beyond the obvious fox in the hen house situation, there’s also a realization on the part of retailers that they should regain control of their business (which more than ever is about managing their OWN brands), and that some vendors just aren’t getting the job done. Whispered in major retail “halls” and will turn into a shout before long.

The only problem with having a category captain is that you lose visibility into cross-category shopping patterns and opportunities. It also pre-supposes a vendor dominance that doesn’t work well unless the retailer is even more dominant.

I think it’s on the retailers to understand their selling and inventory opportunities.

Time Warp: 1990. We’re seated on a plane beside a CPG Sales VP (or at a conference, or on a new business call) and the subject turns to “category management.” “Oh, can you get us some of that? We need to be the category captain so we can discontinue our competitors and rule the shelf!” The great satan of temptation would raise its ugly head and whisper “just say yes!” to cement an easy sale . But instead we would struggle to explain the realities — that only the retailer could ever have the role of “category manager” — in a way that would keep the prospective client from saying “no” long enough for us to maybe still get the business. Fast Forward to 2006. Every CPG manufacturer, retailer, wholesaler and broker has a “category management capability” in house, along with the host of third party options. Shopper Insights are the intellectual currency of the day. Speeches are made at every CM conference about the need for objectivity. But what has really changed? Not much… Read more »

It’s an interesting point of debate. Officially I am certain that retailers and manufacturers would state that the role of the category captain is to add value. The retailer has the understanding of their strategy, stores and customers, and the manufacturer brings customer insight and market knowledge to the table. However, from my perspective, in most occasions, the retailer is using the manufacturer as a cheap resource to produce thousands of planograms. The majority of retailers are pushing to become more customer centric and the only way to achieve this is by producing more granular assortments, aimed at customer segments. To execute these assortments, the retailer has to support them with a schematic, therefore more assortments, require more planograms. The retailer simply cannot scale internally to produce the extra planograms, so the manufacturer steps in. Moving forward, the retailer will start to automate the planogram process, this will then challenge the manufacturer to become more strategic and collaboration will start to bloom. My experience working with manufacturers is that they want to add value to… Read more »

I have seen too many instances, especially in the grocery trade, where the category manager has given total control to a category captain. This situation occurs most often when the category manager is new or just doesn’t think he has time to work the category. When a retailer grants one manufacturer too much authority the result could be as devastating as having the IRS prepare the company’s income tax returns.

All the rush to bury category captainship by various analysts, consultants and media experts is short sighted and possibly self serving; dare we say biased? These experts want to sell us on the latest model they have and reorganization. The reality is Category Management will go away right after slotting fees and ad fees. Both of those are costs the retailer controls, and if they are making good decisions they don’t need to charge, yet few can do without them. Retailers need the manufacturer to support the gathering of data and to provide basic research on individual categories that they lack the time and resources to do. One comment was that the biggest and brightest retailers are walking away already. Well tell that to Wal-Mart, Kroger, Safeway, SuperValu, Albertsons, etc. who all are actively and effectively using category management. Nor have I seen any of the big players totally turn over the reigns on category decisions, and they shouldn’t. Validators will provide one check point against bias but so will the retailer’s incentive system to… Read more »

I strongly believe that a Category Captain program, if managed correctly, can benefit both the retailer and manufacture and ultimately the consumer. My perception of a Category Captain (which I have personally managed and been in the past) is a manufacturer that has a significant “stake” in the category as well as the capabilities and resources necessary to add value to the retailer and category — value that the retailer may not currently be capable of generating due to limitations. The Captain’s role can range from assortment, planogram, marketing, reset prep, etc. Also, I think it is a privilege for a manufacturer to have this role. I disagree with a comment made by someone else – you DO earn a seat at the table if you are a Captain. That all being said, I also believe retailers should institute “Category Validator” roles so that the Captains don’t get all the decision making ability or over influence the retailer. The retailers role is to understand best practices and recommendations and activate them in their stores. Very… Read more »

The category captain debate has raged since the introduction of the CM discipline in the early 1990s. The pros and cons – issues of bias, economics and control mostly – have remained essentially unchanged over that span.

One thing that has changed is the availability of faster, more responsive, more automated tools for monitoring, analyzing, interpreting and acting on category data. Retailers would do well to reevaluate the cost/benefit analysis of working with vendor category captains.

Captains may at times add value by allowing retailers to shift the fixed costs of CM activities and by bringing insight to the party that retailers would have trouble obtaining on their own. But assigning captains does not imply a total shift of category responsibility. It’s the retailer’s ship, not the vendor’s. Even captains must answer to admirals.

It would prove a huge disappointment if category captains were no longer afforded the opportunity to share their insights and views with retailers – or impartial category management companies such as ours – that rely on this perspective to form their own go-to-market strategy for the category. For the very small handful of category captains who fall into the camp of “abusing power,” there is no place at the table. Savvy retailers need to sort through the fluff and misguiding information that a short-sighted category captain may present to favor their own brand, and focus on their consumers.

If the final category strategy does not produce shopper satisfaction nor put the right assortment of products in a logical arrangement on the shelf there is only one person to blame… the retailer. Retailers should rely on honest, forward-thinking category captains who bring “true” value to their analysis and category approach. This should be a win-win-win outcome for the manufacturer, retailer and ultimately, the consumer.

The category management system and category captains work only as well as their training and performance measures are implemented. Category captains change, people get promoted into a new position, or new people are hired. If they have not received appropriate training on the role, responsibilities, and tasks of the category captain, the job will not be performed adequately. If their company does not use performance measures that reward appropriate category captain activities, then the performance will not fit the requirements of the job. There are many variables that affect effective performance. The most difficult part of the task is that it is not a matter of training people once and then assuming that the job will be performed well. Success happens when people are trained well and their performance is measured based upon the criteria for the job.

Category captains aren’t going anywhere soon. The simple reason is that retailers HAVE TO offload this work. They have neither the manpower nor the talent to do it. The idea that retailers will take on this function as part of managing their own brands just doesn’t face up to reality. CPGs have dedicated brand groups for each brand plus focused category managers for major accounts. Retailers will never be able to match this level of focus, even for their own brands. But, there are plenty of problems with this system, and there always have been. The focus is on maximizing the category. That doesn’t necessarily lead to maximizing sales or profit in total. The best approach to that probably requires a loyalty/CRM approach to maximize each shoppers purchases. Finally, I hate to see Wal-Mart used as an exemplary user of category management. After all, they don’t participate in syndicated data. What do they use to benchmark performance? How do they know changes in market share? I’d hate to think that category captains show Wal-Mart how… Read more »

When we put together a category optimization program with a major retail chain, it became obvious who each category captain would be. We wanted insights into the category that the retailer didn’t and/or couldn’t possess. The retailer knew his sales, market share, profitability, etc. but where was this category headed? Health and wellness trends, consumer preferences, additional product testing and research, pricing and promotional strategies, etc. In every case, only one leader came to light, not always the leader in category sales. When the retailer includes this data into the decision making process, the category direction is very clear and the results are easily measured.

Making your private label brand the category captain is also a great idea when the specific goals of that category can’t be met by the brands.

There are some great success stories out there.