Through a special arrangement, presented here for discussion is a summary of an article from Convenience Store Decisions magazine.
A customer-first product assortment can often serve as the foundational element of a relevant shopping experience, driven largely by a deliberate and strategic collection of offerings. For the c-store, where additional factors such as fuel brand can be a key differentiator for prospective customers, relevant assortment can serve as a key element of cultivating a loyal customer base.
Moving away from the traditional thinking -- "We have something for everyone" -- today's c-store assortment strategy should tell a different story -- "We understand what you need."
There are three key elements to achieving an assortment that will both delight consumers and ensure that business goals will be met:
1. High Performance
The assortment must include high performing items, but should be defined here as more than just sales. There are several customer-based performance criteria that must be satisfied:
- Assuming that the retail strategy is not 100 percent niche, items that have broad appeal are essential to generate in-store traffic;
- Keep items on the shelf that maintain a loyal following and are often repeat purchases. Product loyalty engenders retailer loyalty, and the consequences of not having these items available can be extremely damaging;
- Carry items that are favored by the store's best customers. If deciding between two products that perform relatively similarly, reward the store's best customers by keeping the item that they consistently prefer.
2. Coverage of Consumer Needs
Some buyers seek convenience while others prioritize value. And still others have specific brand preferences. An in-depth understanding of the customer, their need states and usage occasions is essential. This can be achieved by a variety of means, either through survey research, or better yet, an examination of actual consumer behavior from shopper loyalty data. Typically, research in this area can identify customers' key needs through an analysis of a product's substitutability. The need to avoid duplication is particularly heightened in c-stores more than traditional grocery, given the limited shelf space available.
3. Relevance for the Right Consumer Targets
A relevant assortment for all consumer types can mean making sure that there is a variety of targeted options on the shelf. It can also mean catering and customizing the assortment by store or transaction point. For example, a customer-centric retailer will offer and display more upscale products in stores that serve more affluent consumers and feature more value-oriented products in stores that serve value consumers.
Customer-first retailers approach product assortment as a form of storytelling, as a way to thoroughly engage and personalize the shopping experience for their most loyal customers. Retailers must learn to disregard their assumptions about who they think their loyal customers are and what they think they want. Further, sales figures are not the only indicator of a product's performance. As a retailer begins to study and understand who their most loyal customers are and what they need, product assortment decisions become more effective and successful. This model will help retailers achieve not only greater cross-category alignment but, ultimately, a more loyal customer base.