10 signs fmcg brand sku is better than other products in the market
What is an SKU in FMCG?
Stock Keeping Unit (SKU)
Understanding Stock Keeping Units (SKUs)
SKUs are used by stores, catalogs, e-commerce vendors, service providers, warehouses, and product fulfillment centers to track inventory levels. Scannable SKUs and a POS system mean that it is easy for managers to determine which products need to be restocked. When a customer buys an item at the point-of-sale (POS), the SKU is scanned and the POS system automatically removes the item from the inventory as well as recording other data such as the sale price.
SKUs should not be confused with model numbers, although businesses may embed model numbers within SKUs.
Why is FMCG good for marketing?
:max_bytes(150000):strip_icc():format(webp)/dotdash_Final_Stock_Keeping_Unit_SKU_May_2020-01-e9246575206c4bba9d4f22dd3272e963.jpg)
Businesses create unique SKUs for their goods and services. For example, a store that sells shoes creates internal SKUs that show a product’s details, such as color, size, style, price, manufacturer, and brand. For example, the SKU for purple Ugg boots in the Bailey Bow style, size 6, may read “UGG-BB-PUR-06.”
By adding SKUs to every product, store owners can easily track the quantity of available products. Owners can create threshold limits to let them know when new purchase orders must be made.
Why Are SKUs Important?
SKUs let shoppers compare the characteristics of similar items. For example, when a shopper buys a specific DVD, online retailers might display similar movies purchased by other customers based on SKU information. This method may trigger additional purchases by the customer, thereby increasing a company’s revenue.
SKUs also allow data to be collected on sales. For example, a store can see which items are selling well and which are not based on the scanned SKUs and the POS data.
Stock Keeping Units vs. Universal Product Codes
Because companies internally create SKUs to track inventory, the SKUs for identical products vary among businesses. Different SKUs help retailers design advertising campaigns without interference from other vendors.
For example, if a company provides the SKU to advertise a certain discounted refrigerator, shoppers cannot easily view the same refrigerator at other sellers based on the SKU alone. This stops competitors from matching advertised prices and poaching customers. In contrast, universal product codes (UPCs) are identical regardless of which business is selling the items.
What are the 3 major segments of FMCG industry?
SKUs Today
SKUs are making the shopping experience more efficient than ever before. For example, when shoe shopping in the past, clerks would have had to visually scour the back stockroom and hunt for a specific model of shoes in the correct size and color. Today, many retailers are equipped with portable scanners enabling salespeople to check back-of-the-store inventory by simply scanning a floor sample. Moreover, online shopping logistics are greatly improved and enhanced via SKUs.
Is a Barcode a SKU?
While SKUs are often depicted as barcodes, they are not always used for the same purposes. Barcodes on products at a store (known as UPCs), for example, are meant to identify products of the same type regardless of where they are sold. SKUs, on the other hand, will also uniquely identify the seller or vendor as well. In addition, UPC barcodes will typically feature only numbers, while SKUs are alpha-numeric and can vary in length.
How Can I Get an SKU for My Product?
SKU numbers will typically appear on a product along with its UPC barcode. Because SKU numbers are intended for the producer to keep track of items, they are not universally standardized – they are company-specific. That means that you can make up any SKU system that fits your needs for your products. Typically, you will want to create a system that maintains a consistent logic, starting with top-level identifiers followed by more unique product- and vendor-specific codes.
From where do I get my SKU ID for Flipkart?
SKU is the Stock Keeping Unit.
It is used for internal reference only. You can frame SKU names as per your wish
Example :
Consider that I wish to sell the above t-shirt and size is medium
Try this SKU format
BNCNS
BN refers to Brand name
CN refers to color Name
S refers to Size
So sample SKU will be: LEEBLM
Where Lee is a brand
What is the advantage of SKU
You can track the product easily
During shipping, we can easily identify through SKU
If the same SKU is maintained across all systems, it will be really helpful for inventory management.
If you feel the above method is confusing , you can simple use 01,02 as SKU
What is the difference between SKU, MPN, and ASIN?
SKU is a retailer’s own Stock Keeping Unit, which they use to keep track of inventory. This would be unique to each retailer.
MPN is the Manufacturer’s Part Number, which in the case of the phones you mention would be i9100, i9100G, etc. You can get even more granular with specific colours, etc. This is sometimes, but not always, classified as a different MPN.
ASIN is specifically Amazon’s SKU (Stock Keeping Unit). You would rarely need to bother with this unless you are an Amazon affiliate, for example.
If a manufacturer sells their own products, it could well be that they’ll use the same code for the MPN and SKU.
Why Would I Want an SKU Code on a Product?
Having an SKU code allows you to track products and sales more easily. This helps with inventory and supply-chain management. With an SKU it is less likely that the wrong item will ship to customers, and also assists in returns if needed.
Here are 10 signs that you have too many SKUs:
You have product managers for “problem child” SKUs
To avoid stock-outs, you carry a lot of inventory
Fact: 80% of sales come from just 20% of SKUs
You have not yet calculated your carrying cost per SKU
You struggle to measure how new SKUs cannibalize sales
You did not rationalize your SKUs after your last merger (and instead kept all SKUs of both companies)
At your company, an SKU isn’t the most granular level of product identification (e.g. 1 SKU has multiple sizes)
SKU portfolio decisions at your company are driven by minimizing risk rather than maximizing sales & profit
The best-selling SKUs in one territory are not tested in other territories
You have separate SKUs for each channel that your products are sold through
Range Selling provides variety of products to customers, reduce the dependency of sales revenues from single or limited products and have better visibility at stores. Range selling is one of the key techniques to do better sales.
FMCG Sales Metrics that Make the Difference
Outlet Coverage
This metric is directly related to the number of outlets getting covered by an FMCG salesman within his quota of outlets to be covered in a specified time frame. Most often, this metric is measured on a day-to-day basis. If the salesmen are unable to meet their defined coverage area mainly on account of ineffective beat planning. On the other hand, an effective beat plan will enable a salesman to effectively handle order collection and visual merchandising in outlets allotted to them.
Outlet coverage is also impacted by improper outlet segmentation and poor beat health. To improve this metric, a salesperson must focus on improving the number of Total Calls (TC) by being able to average at least 40-45 calls per day. The onus should be on improving the number of productive calls as it can significantly improve coverage. This sales activity can be easily done by using the power of real-time data and effective tracking.
Productivity (Effectively Covered Outlet- ECO)
In the FMCG sector, ECO or Effectively Covered Outlet is a metric that defines the number of outlets out of a total number of outlets on a route, market, or territory that are making at least one sales memo in a month. This metric allows the sales team to assess the number of active outlets within a given territory, route, or market.
Product Line Sold (Range Selling)
Among FMCG sales teams, product line sales, or range selling refer to the marketing strategy associated with selling several related products. It is an effective strategy wherein similar products with close functions are sold to the same outlet.
The outlet acquires such products with the belief that they will be able to persuasively sell such products to the customer related to the customer’s original choice. For instance, a company would sell hair care products that could include Hair Shampoo, Hair Wax, and Hair Gel within the same product line.
This tactic allows an FMCG company to diversify its product base, brings in more visibility in the shelf space, and enables the brand to attract more footfalls to the outlet. It is a metric that can incentivize primary and secondary sales force when they sell a stipulated number of lines per call.
Bill Cut (Lines Cut per Call)
This refers to the metric that defines the number of calls a salesman would undertake within a given month. Bill cut is calculated by multiplying the total number of outlets within the territory by 4 (one visit to an outlet in a week, four weeks in a month). This gives the total number of possible calls that can be made by a salesman. To arrive at the bill cut target, this total number is multiplied by the productivity norm of 60% (variable) to give the expected number of calls to be undertaken by a salesman in the assigned territory.
Mathematically expressed as:
Total Number of Calls = Total Number of Outlets x 4
Bill Cut Target = Total number of Calls x 60%
This metric will allow the sales head to set targets for his salesmen. The more number of calls a salesman can make per week, the better his chances to reach targets within the stipulated time.
Throughput (Average Sales)
This metric is calculated by dividing the quantum of sales done by a salesperson for an entire day by the total number of outlets visited by him during the daily beat. Throughput is directly dependent on the outlet stock levels, predicted consumption patterns, drop size of the outlet, and even the launch of new products. This value is known to peak during the festive season. And it is considered best to record this data immediately at the end of the day for analysis of consumption patterns and market forecasting.
How many SKU do you have?
What is a good SKU system?
Have you ever looked at a price tag and wondered why on earth there are so many numbers and letters on it? What are they all for? One of those numbers sets is usually the SKU number (stock keeping unit). SKU numbers are unique to each store and allow the store to keep track of each item in inventory. SKU numbers can be anything you want to be but are most often about 8 alpha-numeric digits.
SKU vs UPC vs Serial numbers
There are quite a few numbers associated with products and inventory-keeping and it can be hard to tell what makes them all different. We know what a SKU number is, but what are the others and how are they different?
First, there’s the UPC number (universal product code). The UPC number is the twelve-digit number that runs along the bottom of the barcode and, as the name implies, is a universal number. That means anyone with a barcode scanner can read the number. It also means that the UPC is not unique to a store. If two companies are selling the same item, those items will have different SKUs, but the same UPC.
Next, there’s the serial number. Serial numbers are unique to each specific product and are most frequently used for electronics. (If you’ve ever had an issue with your laptop, you’ve probably encountered the serial number as you’ve given details to a help desk or customer service, for instance. It’s that number on the barcode tag on the bottom of your laptop.) Serial numbers are used to track the ownership information of an item. They can also be used to track warranty information.
What do SKU numbers mean to retailers?
SKU numbers are important for every store to use because they make life way easier. Each SKU is recorded within your internal tracking system (which is hopefully an inventory management system and not a manual spreadsheet). Once within your system, SKUs will make it possible for you to record loss easily, make smarter inventory decisions, track the exact location of each item, increase the accuracy of your inventory and warehouse activities, and for your employees to easily look up inventory to help your customers. When done right, a SKU number can even tell an employee what item should be attached to your SKU.
SKUs also enable some really amazing marketing activities. For instance, SKUs are what are used to generate suggestions for other items you might like on a site. They are also used to run product remarketing on a site like Facebook.
At the end of the day, SKUs take your physical items and turn them into pieces of data a computer can easily track. You really can’t eschew SKUs.
How Do You Generate SKU Numbers?
You can generate SKU numbers any way you want, but it’s probably easiest to use your inventory/retail management system. The length is up to you, but do take into consideration that your staff will need to be able to easily read and even remember SKUs. (Grocery cashiers, for instance, often end up memorizing swaths of produce SKUs in order to be able to ring faster.) You can also choose to use only numbers or letters – or do a combination of the two.
When choosing digits, you could go totally random. However, it’s better to imbue your digits with some meaning. By that I mean, segment the digits out to refer to certain things. For instance, if you have an 8 digit SKU, the first two digits could refer to the item category, the second two digits could refer to sub-category, the third two could refer to item color, and the last two can be the unique identifier.
There are a number of ways this can be done. First, if your inventory is simple enough, you may only need to specify a single category and combine it with a sequential set of numbers to refer to the item. Here’s a visual example of how that would be put together for a small pet store.
| Category | Code | Item | Code | SKU Number |
| Dog Toys | 10 | Tennis Ball | 012 | 10012 |
| Rodent Accessories | 20 | Hamster Wheel | 005 | 20005 |
| Cat Food | 30 | Salmon Bites | 001 | 30001 |
The item codes should be created in a sequential order (thus, each new item you get in will just be assigned the next available number). The item codes can be reused in different departments, as well. So “012” could be used for Chicken Bites in the cat food department, even though it’s used for Tennis Ball in the Dog Toys department. (That Chicken Bites SKU, by the way, would be: ‘30012.’)
However, your inventory may get more complex. Here’s a quick list of the aspects of an item you might wish to put into a SKU:
Supplier
Store Location
Department
Variation
Item Type
Size
Color
Let’s look at how a clothing store with men’s, women’s and children’s clothing might want to create a SKU.
| Department | Code | Category | Code | Color | Code | Item Number | SKU |
| Men’s | M | Knits | 223 | Purple | 02 | 001 | M223-02-001 |
| Women’s | W | Knits | 223 | Brown | 58 | 010 | W223-58-010 |
| Children’s | C | Denim | 604 | Pink | 25 | 035 | C604-25-035 |
| Women’s | W | Dresses | 005 | Green | 51 | 120 | W005-51-120 |
Each section of the SKU tells a detail of the item and these codes can be put together in unique ways to demonstrate particular items. A different men’s purple sweater than the one seen in the table above, for instance, might be M223-02-002. You could also see that the first 5 digits of any women’s purple sweater would be W223-02, or that a pair of men’s green jeans would start with M606-51.
When a SKU number is put together this logically, it becomes easy to see how a sales associate might be able to take a number and figure out what item it represents.
SKU Number Tips
You can reuse SKUs.
Some people will tell you not to reuse SKUs ever — but the truth is, as long as you wait for a few years or so (after multiple total catalogue refreshes and completely selling all items attached to that SKU) you can certainly reuse your old SKU numbers.
The store I worked for in college did this with no hiccups. In fact, the only reason I ever realized that they reused SKUs after a number of years is because one customer decided to return an item she bought 12 years previous and had never worn. The item still had the tags and the old SKU number, which corresponded with a new item when I typed it into our system.
The first 2-3 digits should represent the highest category.
Use the first few digits of the SKU number to represent what is the highest category of importance about the item to you, and work into the more unique features of the item. (And once you’ve locked your formula in, always write your SKUs in the same order.)
Think of it as the opposite of how you identify where you’re from. That is, when identifying your hometown, you start most specific and get more broad. I’m from Trumbull, Connecticut, in the United States, which is on the North American continent on planet Earth. A good SKU number goes the opposite direction, essentially identifying planet first and town last.
Avoid beginning the SKU with the number 0.
You shouldn’t start your SKUs with 0s, mainly because some data storing software may interpret that 0 as literally nothing. That is, when told to store the number “012345,” the software will read it as “12345.” It’s just best to avoid putting yourself in that situation altogether. (This tip is a solid data storage tip in general. Try to avoid starting data with 0’s.)
Do begin your SKU with letters.
Starting your SKUs with letters is an easy way to help them stand out in a spreadsheet filled with other numbers. It provides an easy visual cue that that’s the beginning of a SKU number, rather than a continuation of the number in the cell before it.
Avoid using letters that look like numbers.
It’s a good best practice to avoid using letters that can be confused with numbers or even other letters (‘I’ can look like ‘1’ and a lowercase ‘L’, for instance).
Your staff will (fairly often) have to type SKUs in by hand and you really want to make this process as quick and easy for them as you can.
If you don’t want to completely cut these numbers and letters out of your system, you should ensure that you use sectioned SKU numbers in which some sections are only ever [uppercase] letters and some sections are only ever numbers. IE, a SKU that looks like this: BLE-134. Your staff will know that ‘O’ is the letter and not a zero if they see it in the alphabetical section in that case.
Don’t use any of the manufacturer numbers within your SKUs.
In general, it’s recommended that stores avoid reusing the manufacturer numbers as or within their SKU numbers in order to prevent confusion. SKUs are meant to be unique to each business, so go ahead and honor that. Of course, the easiest way to avoid using any of the manufacturing numbers is to have a set formula (as mentioned in the previous section) for generating SKUs in place, rather than to approach SKU creation haphazardly.
Don’t overload your SKUs with meaning.
Finally, while you do want to infuse your SKUs with meaning, you don’t want to overload them. For instance — you don’t want to end up creating a 32 digit SKU because you wanted to get every last piece of detail you could into the number. It’s better to forsake some detail in the name of ease of memorability and fitting the number on your tags.
So pick which 2-3 aspects of items matter most for you when dividing up your warehouse or store floors and then let the item’s specific identifying number at the end of the SKU do the rest of the lifting.
And if you really need to fit more than 3 aspects of detail in, keep the individual codes as short as possible. For instance, if you work with nine manufacturers, assign them a single digit 1-9, rather than abbreviating their name into a 2-3 letter code.
Avoid using dashes and periods.
While you can technically include certain symbols and punctuation marks in your SKU numbers (e.g., “.”, “-“, “_” and “/”), it’s best to avoid them. Characters like period and dashes may cause issues when printing barcodes.
Using SKUs to seamlessly sell on multiples channels
I’ve worked for a couple of different consumer product companies that sell into mass retail.
Most mass retailers have a role called “Category Manager” or “Category Buyer.” It’s the buyer’s job to manage the mix of products available at shelf to maximize both total dollar sales and total dollar profit for the category portfolio.
The buyer generally doesn’t manage the individual margin on any one individual sku (most manufacturers “line price” their products so that the expected shelf price at retail makes sense by size/feature mix).
Category buyers manage the portfolio of brands and product segments. Because they have multiple manufacturers selling very similar products (and sometimes have cost data on their private label goods), they have a pretty good idea of the margins each manufacturer is getting and can manage price increases according.
Most times when there are discounts at shelf, the manufacturer is funding the discount through some type of marketing funds.
That actual data used by a mass retailer is captured either through a proprietary internal system, a 3rd party vendor (like Nielsen or IRI), or some combination of both. It wouldn’t be unusual for a category buyer to run tests in a subset of stores to see what the impact of certain changes (introduction of a new product, price increase/decrease, etc.) would be on the total sales and profit of the category.
Must Sell Products (MSPs)
This metric refers to the tactic of selling the right product to the right outlet. It is a given fact that an FMCG salesman would not be able to sell all products to an outlet. But he can be sure about the sale of specific products that the outlet would readily buy because of the existing demand. Such products are known as Must Sell Products or SKUs (MSP or MSS).
An FMCG company can improve this metric by selling SKUs or products to outlets based on the economic demography it’s catering to. For instance, certain kinds of chocolates are only known to sell only in outlets that cater to the upper-middle-class customer segment. Hence the company can make those chocolates an MSP in those types of outlets.
How can I improve my sales in FMCG marketing?
To improve sales of FMCG products work on below points-
Identify the right set of outlets where your product should be distributed. Check the price point, target consumer & understand the profile of outlet which caters to the price point & consumer.
Once you know the right type of outlets, make sure you place your product at each of such outlet in the city.
Appoint distributors who have good reputation in market, have good infrastructure, good sales team to take orders from market & supply according to the demand in market.
Create awareness about the product at retail stores – put window display, posters, counter top display to create distraction in consumer’s buying cycle.
Make sure you supply all the outlets once in a week, take order for all skus regularly, do not miss out on any sku. Regular service is very important.
Create contest for the sales team/salesman/distributors, give them business targets, reward them with lucrative options may be money/trip/utility items etc. Create competition among the sales team to achieve more. Beat the past performance.
Sale steam should be able to pitch product benefits/schemes/consumer promos in market to sell more to retailers. Remember if you sell more, some other competition’s product will be bought less by retailer.
What are the best sales strategies for a FMCG product?
The most effective answer relies heavily on the type of product, and the market it’s in. to try and summarise this in a post, let’s go back to the 4 P’s:
Product
A lot of the larger FMCG companies invest a lot of time and effort into understanding competitor products in the market place. What they (sometimes) neglect is a deep understanding of what makes their product different to others, and exploiting these nuances.
How does the product make your consumers feel?
What is the brand message?
Does it perform a different role to others? Does it get consumed at different occasions? Understanding who your customer is, how they interact with your product, and why they purchase it is very important.
Price
One CRITICAL principle in pricing is that pricing is RELATIVE. The price you sell at needs to match your customers expectations of what they would pay for something of that quality. Price it too low and you devalue your brand. Price too highly and nobody will buy. FMCG companies tend to adopt one of 2 pricing strategies: HILO and EDLP. HILO is putting a product at a high shelf price, so you can promote it down to a lower, more attractive price when it matters, to drive impulse purchases. EDLP is having your product at the same price all the time (it stands for every day low price). Examples of products that work well on HILO include chocolate, biscuits, and wine. Examples of products that work well on EDLP include garbage bags, milk, and home basics
Promotion
If you think your product can drive incremental volume if it goes on promotion, then you also need to consider your promotion strategy. Deciding what time of year, how often, for how much, and what pricing mechanic to use are all very important to the success of your promotion. Your promotion strategy should also be aligned with your brand strategy (e.g. don’t use 60% discount on a luxury product!), as well as your customer use case (e.g. don’t offer a 2 for $x if your average customer only buys 1 a year!)
Place
As other people have mentioned, distribution is VERY important. Getting your salesforce out to the most profitable, AND the largest channels of distribution is not only critical to growing your product sales, but also in increasing your brand presence, which will in turn drive demand. Ways to get your product stocked on shelves include:
Offering freebies. Works particularly well in impulse channels, where independent stores like the idea of getting things for free (e.g. a branded fridge)
Undercutting your competitors (in price, or in margin, or both). Works particularly well in price sensitive channels such as the discount channel.
The key here is to play the portfolio game, so that margin loss on some products are counteracted by profit gain in others, that form part of the deal with your discounter
Fulfilling a purpose. If you’re the only player in the market that fills a particular use case, then you can drive incremental value for your retailer, which is highly attractive
Getting consumers to shout about you! The voice of the consumer is very powerful. Getting people to talk about you, and create a buzz around your product, will make buyers far more likely listen to your sell in story
What are the best marketing strategies followed by FMCG companies?
Some of the major strategies adopted by FMCG companies for making their brands outstanding
(i) Multi-brand Strategy – they use multiple brands in the same category like ITC ashirwad aata and ITC sunfeast both are the same company grocery category products but market value are different because of their brands.
Also ITC company make cigarette like gold flake, classic
(ii) Product Flanking – using this strategy FMCG companies targeting more customer segment, basically creating same product in different size and weight like shampoo and gold flake – big and small
(iii) Brand Extensions – also called category extensions in which many FMCG companies are marketing a product with a well-developed image uses the same brand name in a different product category. The new product is called a spin-off. Organizations use this strategy to increase and leverage brand equity. example of colgate making toothpaste but also extend in the mouth fresh, tooth brush.
(iv) Building Product Lines – in this time all FMCG company define their product line.
to explain this I use some products of ITC
(v) Product Development – changes and making new products are important because of products Life Cycle, when the consumer is bored from using one type of product then the product go to decline stages that’s why Product development are important.
(vi) Product Life Cycle Strategy – The product lifee cycle contains four distinct stages: introduction, growth, maturity and decline. Each stage is associated with changes in the product’s marketing position. You can use various marketing strategies in each stage to try to prolong the life cycle of your products.
(vii) Taking advantages of wide distribution network. –
1 great good distribution channels
2 set margin of the brokers
3 branding and awareness building
4 make your website
5 build your outlets like patanjali
6 market your product
7 good margin to retailer
8 maintain good quality
9 do digital marketing
10 selling on B2B and B2C platform like Amazon, flipkart, big bazaarar
What percentage of a fashion retailers inventory is sold before they are taken off the racks and sold/disposed to post-retail channel (e.g., discounters, outlet stores, trashed)?
The average sell through of most retailers in fashion is about 65%. Some like Zara boast of much higher sell throughs of 75%.
(Sell through = % of goods sold at full price)
After this figure the % brands can flush heavily varies on their discount strategy and the channels they use. Most of the goods are discounted are sold on online marketplaces like tao Bao or myntra. Anyone’s guess is 3%-5% of unsold inventory is accumulated after all efforts.
H&M recently was in news for sitting of 4Bn worth of unsold inventory. (Approx 16%). This figure was misleading because it included the stock they carry for actual sales and the figure was in full price retail value. Only a small part of it would be un-sellable.
What is the number of SKUs in a typical Supermarket, grocery store, Fashion retailer and an electronics retailer?
It varies depending on store type and the retailer’s strategy.
A typical grocery store would carry 30,000 to 50,000 SKUs. However, convenience grocery store would carry 2000 SKUs.
A wholesale retailer would carry 5000 to 7000 SKUs.
How new SKUs affect brand choice in the presence of consumer uncertainty and learning
New product activity is deemed to be one of the key drivers of sustained brand success in consumer packaged goods (CPG) markets (Gielens, 2012, Gielens and Steenkamp, 2007).
By adding new stock-keeping units (SKUs) to the brand’s product line within the category, brands may increase their sales by catering to consumers’ heterogeneous tastes and need for variety, and by improving their image as being innovative and high-quality.
It is generally accepted that even in CPG categories, consumers are imperfectly informed and uncertain about the brands’ ‘match’ quality, i.e., the extent to which the brand fits their needs (Steenkamp, 1989, Zeithaml, 1988).
This quality uncertainty persists even after consumption of the brand (Erdem et al., 2004), because use experience may provide only noisy information, and it may be difficult to isolate the quality of the brand from other confounding factors (such as advertising or information displays; Hoch & Deighton, 1989).
Further, consumers generally buy and consume products sequentially rather than simultaneously, which hampers effective brand comparisons and learning (Warlop et al., 2005).
As such, consumers only gradually resolve their uncertainty about brand quality over time (Ching et al., 2013, Erdem, 1998). Even in the longer run and for established brands, some uncertainty remains because not all category users (frequently) consume all brands, consumers may forget about their experiences, and new users may enter the category.
Spillovers occur across categories, they are bound to be even more pronounced for brand-line additions within the same category (which is our focus) – information about same-category additions being considered more diagnostic than information about more distant extensions (John et al., 1998).
This impact of line additions on brand quality perceptions may come about in different ways.
First, the quality level of new SKUs may differ from that of the current brand line. While appealing SKU additions may lead to a more positive assessment of the brand as a whole, unsatisfactory additions undermine consumer perceptions of the brand’s ability to offer consistently-high quality (Erdem and Swait, 2004, Sorescu et al., 2007). Second, new SKUs may increase consumer uncertainty about the brand’s quality (Erdem and Swait, 2004, Sorescu et al., 2007).
Both these effects evolve over time. Even if consumers immediately recognize the possibility of a quality change, they may come to experience the actual change only gradually. And, as their experience accumulates, the increase in brand risk dissipates again. Understanding these processes can help brand managers in planning and monitoring their line additions. Yet, these dynamic effects of new SKUs on consumers’ perceived quality, quality uncertainty, and subsequent choice of the brand overall are not well documented. Moreover, the effects may depend on the type of introduction, i.e., the ‘novelty’ attribute of the SKUs.
The Price Point War
The nation’s largest household goods makers are introducing cheaper packs— ₹10 is the popular choice—of products ranging from soaps to chocolates to attract new consumers as an economic slowdown in Asia’s third-largest economy depresses demand.
The ₹10 price point is required because we have to increase consumption. For doing that, we have to increase penetration,” said Mohit Malhotra, chief executive of Dabur India Ltd. “So, if you look—whether they are economy brands or premium brands, they are all reaching out at that price point.”
In recent quarters, Dabur India has introduced a Real Koolerz drink at ₹10, and even rolled out its Amla hair oil priced at ₹10 (30ml). The company recently launched a ₹10 Babool Ayurvedic toothpaste and is pushing its oral care brands such as Red toothpaste and Babool’s ₹10 packs as it expands its rural reach.
To be sure, India is a large value market, which means that biscuit packets priced as low as ₹2 and one-time shampoo sachets priced at ₹1, as well as chips and chocolates at ₹5 and ₹10 draw big numbers for companies. This is especially true for categories such as salty snacks, chocolates and biscuits.
When customers step foot inside a grocery store, they are bombarded with options. As you know, the market is saturated and you need to find a way to differentiate your products. Without the right differentiation, customers won’t even consider buying your product, considering they have many options.
Product differentiation and its importance, focusing on consumer goods products.
What is product differentiation?
Product differentiation is a strategy to distinguish your products from those of competitors. Look at product differentiation as what makes your product stand out from the crowd.
Why do customers buy your product? Why is it special compared to other products in its category?
Does your product provide something that others don’t?
These are just a few questions that can help you find the right product differentiators.
Don’t worry if you haven’t figured out the differentiators yet. You don’t have to start from scratch, you can develop them as you promote your product.
A differentiator can be related to anything from packaging to the values of the company. For instance, a product that is 99% natural or one that is eco-friendly has a powerful differentiator. Depending on the type of product, your resources, and the needs of your target audience, you can find differentiators that will help you gain a competitive advantage.
Types of product differentiation
When they decide to buy a product, customers look at different types of differentiators. They are divided into three groups:
Vertical differentiation
Vertical differentiation is an objective one. It is when customers rank products from best to worst considering objective measurements like price, quality, quantity, and so on.
Even though the factors that are taken into consideration are objective, customers have different objectives, needs, and wants. For example, one customer might put a higher value on price and not care about the ingredients of the product, while another customer could choose a more expensive product because it has more natural ingredients.
Horizontal differentiation
The horizontal differentiation is a subjective matter. When shoppers don’t have any objective factors to consider, they reside in choosing products based on what they like or dislike.
For example, a shopper wants to buy chips. There is no objective factor to ranking chips flavors. They will just choose the flavor of chips they enjoy the most.
Mixed differentiation
When making a more important purchase decision, customers might use mixed differentiation. They will consider both objective and subjective factors to be sure that they made the best decision.
For instance, if customers want to purchase big home appliances, they will first consider objective factors like price, dimensions, and electricity consumption. Then, they will look at subjective factors such as design, color, etc.
Product differentiation at the point of sale
What if we’ve told you that besides regular differentiators (price, ingredients, etc.) there is a differentiator that can make you stand out right at the point of sale?
Customers want more than products, they want experiences.
Advantages of product differentiation
Still not sure how product differentiation can help your brand? Here are 3 advantages you should take into account:
Gain competitive advantage
Different always stands out. In a store where all products blend with one another, a strong product differentiator will help you gain the attention of shoppers.
Increase brand loyalty
When you have powerful differentiators, you have the opportunity to make your brand memorable. Customers want to purchase products from brands they resonate with and from those that are top of mind. Product differentiation will help you increase brand loyalty in the long term.
Increase sales
The ultimate goal for any FMCG brand is to increase sales in-store. With strong product differentiation, you will be able to increase sales right at the point of purchase. Why? Because shoppers won’t think twice before buying your product.
Making your product stand out can be a challenging task considering the variety of consumer goods products available nowadays. However, with the right differentiators and a bit of innovation, you can achieve this goal. In the long run, product differentiation is your biggest ally against your competitors
What are the common reason for SKU duplication and is there any software which helps me prevent duplicate SKU?
I am facing the problem of SKU duplication as I sell on multiple online stores.
SKUs are the unique identifier of your product, it works for as a primary key for your product information database. If you try to fetch out any information regarding your product, want to update the stock level or edit the product information, the only thing which enables your e-commerce system to identify a particular product is SKU.
So it’s extremely critical to keep SKU duplication at bay. Even Shopify fails to resolve the issue of duplicate SKU. Orderhive tries to eliminate the possibility of duplicate SKU from base level as it restricts the duplication of SKU entries while you are adding a product in Orderhive back-end or importing the product details through CSV.
However, the possibility of SKU duplicity still exist, duplicate SKU is considered among the top concern of eBay sellers, Shopify merchants, Amazon sellers and bigcommerce merchants
So what are the common occurrence of duplicate SKU?
Direct Duplication
Sellers often create a direct duplicate for other product(s).
Multiple listing pages of similar products
Duplication in Shopify
Shopify allows sellers to quickly create duplicate pages from an existing one and then edit the details, which creates SKU duplicity.
The Solution
Orderhive has therefore incorporated some SKU management features which enable you to
Detect duplicate SKU
Remove duplicate SKU
Assign new SKU to the existing products
Detect duplicate SKU
This feature improves online stores inventory management by reducing the duplicity of SKUs. Orderhive automatically identifies already existing duplicate product codes ( SKU ) across the channels and display it against the selling channel.
How do I get a product ID and SKU for selling in Amazon Seller Central?
Many new sellers take a lot of time to understand Amazon’s processes and requirements. In this regard, the common terminology related to the question.
what is a seller SKU on amazon?
No matter whether you go for a private label, wholesale, dropship, handmade retail, or online arbitrage, SKUs are a requirement. You might be thinking what is seller SKU and how it will help you in your business? So, let’s see
What does Seller SKU mean on Amazon?
SKU stands for “Stock keeping unit” it’s a short term used to describe the barcode. Amazon SKU is a unique combination of letters and numbers that is assigned to each product. This means that SKUs are not optional. Therefore, every product on Amazon is required to have an Amazon SKU number.
How do I generate all SKUs for a product in a single line on Shopify?
The simple way is to visit Shopify backend > Products > All Products.
Select all products or the number of products for which you want to edit/add SKU.
Now, click on edit product:
Here, you’ll be able to edit/add SKU of different products/variants in one go!
How do I resolve the ‘SKU doesn’t exist in Shopify store’ notification on OnBuy orders?
This notification comes when the SKU is same on OnBuy and app but different on shopify store so to fulfill this order you need to give the same SKU in shopify store for that product then it can be created on shopify and you can fulfill the order.
How do you market your Shopify store to get sales?
Marketing strategies play a significant role in promoting and making your business known. Without marketing, you can’t run any business appropriately. Here are a few strategies you can try:
You can set up a Facebook page and set up a shop on the platform. Many brands have done this, and they have found great success on Facebook. Most markets on Facebook are online, and they are just waiting for you to reach them.
If you already have an online store on Shopify, you don’t need to create your own Facebook page. You can promote your online store straight away. You can do it in Facebook groups. Just post in a relevant group and bump it regularly.
Pinterest is a beautiful place to post product pictures. If you do it right, you’ll find that the platform has the power to drive leads to your online store. It is a matter of creating the right board and having some enticing pictures.
If you can set up a shop on Facebook, you can do it on Instagram too. Instagram is now a home for more than a million online stores on the Internet.
Twitter is another social platform that you can use if you want to promote your online store. It allows instant updates in short sentences.
Coupons are common in the world of e-commerce. They can generate a ton of sales. Studies show that e-commerce website owners that give discounts get more deals than those who don’t.
Shopify apps also boost your store sales. Many apps are working on lead capturing, upsells, cross-sells, smart placements, e.g.Cartroids, Milk the lead, Money Money bar, EZ Cart & Checkout Sticky, etc.
Most of these platforms are free. By using these strategies, you can increase the sales of your Shopify store.
How can I get my product (Single SKU) in multiple categories on Amazon?
How can I find the SKU of a product I have already removed?
whatever you are trying still, your best bet is to contact Amazon, act novice and explain how you lost your SKU mistakenly deleting a Listing. You should provide details such as FNSKU or product UPC code for them to extract the information.
Bonus Tip: Try to contact the Catalogue team from browse node request so your ticket reaches the correct department. I have seen that normally General Seller Support at the front-desk tries to resolve such queries themselves.
find some ways to get Amazon free products. Besides, you can use some free audio books, e-books.
The fastest way to free products on Amazon is by visiting a site called cashbackbase.com.
Make good use of AMZDiscover
Facebook Groups give free Amazon products
Free Amazon products on Tomoson.com
Be an Amazon pro reviewer
Become a vine reviewer
How do you market your Shopify store to get sales?
One of the best promotional methods currently used by many to get targeted traffic is to create paid advertising campaigns.
Where this method is considered one of the best methods currently, and one of the best advertising sites that you can deal with is ELeavers ( Search in google for ELeavers ).
Where the cost of advertising on this site is low and cheap, and in return, you can get unique and targeted traffic and notice an increase in traffic.
Top most festival Products FMCG consumers search today
World Wide Festive Trends Decoded What Indian festive consumers seek...
Read More
How right selection of FMCG Salesmen improves brand market share
How can FMCG Companies improve salesman’s technique in order to...
Read More
How most searched Fmcg sales and marketing words help newbie salesman
Why undestand FMCG sales management? Sales management is the process...
Read More
How Successful FMCG Salesman Starts his Day, a guide
How does one become a good sales executive in the...
Read More
Pingback: How Top trends show underdog brands are doing better than big brands - DigitalGumma
Pingback: Active social media+Persistent SEO+Offers=Online sales
Pingback: Case Study Examples of Social Ads That are Just Plain “Woke”
Best of luck!
Hello! Ben, Agreed it’s a dog-eat-dog world but… Thank you for the kind words.