Articles
Beyond Product Planning: Micro Marketing and
Store Assortment Planning
(Part 4 of a Series)
Terry J. Donofrio, President
Retail Systems and Services (RS&S)
Our previous articles outlined three
Merchandise Planning techniques that go beyond
basic product planning: Assortment Planning,
Store Planning and Store Clustering. This
article addresses two more: Micro
marketing and Store Assortment Planning.
Today many retailers are faced with
merchandising many stores with varying customer
types and preferences.
To succeed, retailers have to tailor
messages and offerings to very small groups.
That concept has two components—finding
out the specific tastes of customers in each
location and customizing the merchandise
assortment to meet those tastes.
Today’s technology makes both of those
components possible.
First, micro marketing tools enable a
large retailer to determine for each location
its customers’ income levels, ethnicity, work
status, and other characteristics and combine
this information with store characteristics,
such as whether it is in a suburban or city
location, warm- or cold-weather climate, mall or
strip center.
Then the Store Assortment Planning tools
take over.
They make it possible to meet those
unique needs by fashioning different merchandise
assortments—a different assortment for each
store, if necessary.
Micro
marketing as a Retailer’s Tool
For example, a retiree on a fixed income
level will not have the same “brand focus”
as a trendy thirty-something, or even as an
affluent senior citizen.
By carefully looking at the dynamics of
the customer base, retailers can develop a
“local market focus” and meet customer needs
with targeted inventory selections.
Not only are tailored offerings more
attractive to local customers but they are also
less of an inventory investment.
This targeted inventory results in fewer
markdowns, better sell-through, and improved
profitability.
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