Simplify Catalog Assortment Optimization with A Single Score

Merchandising leaders agree that in the realm of direct marketing, finding the right balance between creativity and data-driven strategy is a true art form. The goal is to present the perfect products to your customers at precisely the right moment. In theory, this sounds simple, but in practice, it often feels more like trying to nail jello to a tree. 

This article delves into the core challenges faced by today’s direct marketing product leaders, emphasizing the pressing need to tackle them. We’ll introduce an innovative solution that could be the guiding star your catalog merchandising team has been searching for.

Streamlining Your Assortment Optimization Approach

Our streamlined approach, called AssortmentGURU, has proven to save merchandising teams a remarkable 33% of their valuable time, all while fostering profitable growth. Imagine what your exceptionally talented team could accomplish with an extra third of their time at their disposal!

If product assortment challenges are causing you headaches, this article offers a ray of hope. There’s a promising path ahead for achieving outstanding results in less time and allowing your product development experts to get back to what they do best—creating your next smash-hit products.

High-Stakes Merchandising Challenges for Catalog Merchants

No one has to tell a merchandising professional what’s at stake when determining product strategy. Getting the offer, catalog page count and assortment right is a huge undertaking including these key challenges.

Optimize the Product Offer and Beware of Cannibalization

Crafting your catalog or omnichannel product assortment is akin to a high-stakes game where perfection is the aim—no more, no less. However, lurking in the shadows is the challenge of cannibalization. This cunning adversary impacts every move made by merchandising and marketing leaders striving to boost sales.

Adding a few extra catalog pages may seem harmless—just a bit more paper and ink, right? Experienced product experts and marketing pros know better. Those additional pages bring along some unwelcome baggage: increased paper and postage costs, added product costs, increased cannibalization of existing products, and those concealed expenses like merchandising, product development, and photography.

The true cost of product expansion is more than just ink and paper; it could result in a loss of profitability. Understanding this is the key to ensuring that every page you add genuinely adds value.

For instance, if you generate $100,000 with 20 shirts and, when you add a 21st shirt, you still generate $100,000, then your incremental sales are zero. That extra shirt didn’t contribute to your top-line revenue; it merely redirected sales from the rest of your assortment, negatively impacting profitability.

Optimize the Product Assortment

Once you’ve cracked the code for the ideal page count, the next challenge is assembling the perfect lineup of products. However, it’s easier said than done:

• How do you strike the right balance between assortment depth and breadth while maximizing sales, profitability, and growth?
• With numerous metrics at your disposal, making isolated decisions can lead to conflicts.
• Countless hours are invested in arriving at decisions we’d like to think are objective but are often influenced by subjective human bias toward product favorites. The time this takes diverts attention from critical tasks like new product development and offer optimization.
• The lack of a standardized approach leads to inconsistency in product evaluation, causing issues across categories and titles in multi-catalog organizations instead of one cohesive, consistent merchandising strategy that drives the organization forward.

The Imperative Need for a Better Assortment Optimization Solution

Today, more than ever, the pressure is on:

• Marketing costs are soaring.
• Paper and postage expenses compel merchandising teams to make precise product assortment decisions.
• The hit rates for new products are declining, making investment in new product development riskier.
• Stakeholders demand immediate results.

This is where AssortmentGURU by IMS steps in as a unique and effective solution.

A Single Score Instead of Mountains of Metrics Changes the Assortment Game 

Imagine if there were a single score that could cut through the sea of data points. Such a score exists, and it’s changing the game. With more than 25 years’ experience in direct marketing, and a deep-rooted history in data-driven catalog business decisions, IMS developed AssortmentGURU – a product scoring tool that consolidates a multitude of metrics into a single standardized per-item score everyone on the team can use.

• Each product receives a seasonal score, offering an objective rating based on current performance and future potential.
• Instead of drowning in spreadsheets and metrics, AssortmentGURU streamlines decision-making, reducing the time spent by up to 33%.
• Product leaders can access and analyze all data using the AssortmentGURU Insights App, a secret weapon that focuses on the styles identified by the tool’s product score for maximum impact.

The Red-Yellow-Green Approach Saves Time, Lends Merchandising Focus

One of AssortmentGURU’s distinctive features is the straightforward Red-Yellow-Green approach to product decisions:

• Red (Easy Cut): Historically, around 25% of products fall into this category, signaling it’s time to bid them farewell. This group provides valuable insights for avoiding similar mistakes in the future.
• Yellow (Research): Roughly 50% of products fall here, demanding further analysis using the AssortmentGURU Insight App. Decisions are made based on the likelihood of success in the next season.
• Green (Easy Keep): The remaining 25% are your keepers. Studying this group reveals the secrets to success.

This approach is a time-saving masterstroke, freeing up as much as 33% of valuable product manager and category manager time. Product leaders can reinvest this time in crucial activities like new product development and exploring existing products further.

Proven Business Value Across the Board

AssortmentGURU by IMS isn’t just another tool; it’s a versatile solution that has left its mark across various facets of businesses and brands that have embraced it:

• Both existing housefile buyers and new customer acquisition have benefited.
• Businesses across diverse categories, from Food to Apparel to Hardgoods, have seen remarkable results.
• It’s effective in both print catalog and digital applications.

This widespread success underscores AssortmentGURU’s adaptability and its ability to enhance your assortment optimization and overall merchandising strategy.

Mastering the art of catalog merchandising is no longer an insurmountable challenge. AssortmentGURU simplifies the process, saves you time, and supercharges your growth and profitability. By addressing the core challenges, you can elevate your merchandising game and thrive in the fiercely competitive world of direct marketing.

If you’re eager to learn more and see if AssortmentGURU could be the solution your merchandising team has been searching for, don’t hesitate to book a demo. The AssortmentGURU experts can provide you with insights and connect you with fellow merchandising leaders who have used this amazing tool to drive their businesses to new heights of growth and profitability.