We’ve already explored a lot of jargon in our three previous articles (here, here and here). But there’s still more to know! Let’s explore five more important acronyms that every category management professional will encounter.
CPG – Consumer Packaged Goods
Consumer Packaged Goods are products consumed or used daily by individuals. This includes food and beverages, personal care products, cleaning supplies, and more. Because these goods are purchased frequently, CPG companies focus heavily on specific strategies to position their products in the market, such as product differentiation, branding, and packaging designs. For retailers selling these goods, understanding how CPG companies work is crucial for retail category managers to drive foot traffic to their stores.
CDT – Consumer Decision Tree
A Consumer Decision Tree is a framework used to understand and analyze consumer behavior and the path to their purchasing decisions. It maps out the various factors that influence a consumer’s decision-making process, such as price, brand reputation, quality, convenience, and personal preferences. Organizing these factors in a tree structure can help category managers better understand which decisions matter to consumers the most when buying products in a category. By analyzing the CDT, category managers can gain insights into consumer needs, preferences, and motivations. This understanding helps in developing targeted marketing strategies, optimizing product assortments, and enhancing the overall shopping experience.
MOQ – Minimum Order Quantity
A Minimum Order Quantity represents the minimum quantity of a product that a supplier or manufacturer requires retailers to purchase in order to place an order. MOQ is set to ensure that suppliers can maintain production efficiency and profitability. Category managers need to consider MOQ when making decisions about product assortment, inventory management, and budget planning. Managing MOQ effectively helps in optimizing inventory levels, reducing stockouts, and maximizing cost efficiencies.
POD – Point of Distribution
A Point of Distribution refers to the physical location where a consumer can purchase a product, such as a store shelf. Managing POD effectively is essential for ensuring timely and accurate delivery of products to meet customer demand. Category managers analyze the PODs to optimize product distribution, minimize transportation costs, and improve overall supply chain efficiency.
And on that note, a bonus acronym…
TPD – Total Points of Distribution
Total Points of Distribution refers to the total number of locations or outlets where a product is available for purchase. TPD includes both physical stores and online platforms. Measuring TPD helps category managers understand the reach and availability of their products, identify gaps in distribution, and plan expansion strategies. Increasing TPD can lead to broader market reach and higher sales opportunities for brands and retailers.
PDQ – Pretty Darn Quick
Pretty Darn Quick is a term used to describe a type of display often used in retail environments. A PDQ display is a small, self-contained unit that holds and showcases a specific product or collection. These displays are designed to grab the attention of shoppers and create impulse purchases. PDQ displays are typically placed near checkout counters or in high-traffic areas of the store. Category managers use PDQ displays strategically to increase product visibility, promote new products or seasonal items, and drive additional sales.
Understand the jargon to excel in your career!
Proficiency in the terms used in category management is essential for professionals looking to excel in the field. By mastering these concepts, you will be equipped to analyze data, make informed decisions, and optimize your category strategies.
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