Behavioral Clustering and Assortment Planning Solution

Sales in each brick-and-mortar and online store originate from a unique mix of customers with different preferences. Tailoring your assortments by cluster and by store gives shoppers the choices they want; boosting sales, cutting waste, maximizing profits and building customer loyalty.

Customer-centric category management

Different shoppers value different things. To drive sales, you need to optimize your product offering to the needs of each physical and online store’s clientele. Our behavioral clustering and assortment planning solution enables clustering by stores and by category to offer tailored assortments that maximize revenue while benefiting from economies of scale in purchasing and replenishment.

Case study

M.Video, the largest Russian consumer electronics retail chain by revenue, achieved significant cost savings after taking advantage of behavioral clustering.

Behavioral store clustering and automatic tailoring of assortments

RELEX’s software helps build an understanding of how consumers make shopping decisions and which product attributes affect them, within your different categories and stores. Based on identified variance in shopping patterns, or the so-called consumer decision trees, our solution identifies the most efficient category-level store clustering for tailored assortments. Building on this, the software enables you to allocate the right product mixes to the stores by available store space. It prioritizes profitable products, balances breadth and depth of assortment, and handles core items and local specialties.

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Shopper behavior

Our bottom-up analysis of store and category demand patterns evaluates all available product attributes and sales/forecast data to understand how consumers make product choices.

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Clustering insights

Stores and categories that are shopped in a similar way are automatically identified based on variation in demand. Demographic and geographic data offer further clustering insights.

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Efficient clustering

Our behavioral clustering software identifies the most efficient number of store and category clusters to capture relevant differences in shopping patterns without losing economies of scale.

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Tailored assortments

The assortment planning software recommends assortments with the right depth and breadth in every category and tailors the choice to the customers’ needs on a cluster or store level.

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Space-aware assortments

Store layouts and fixtures as well as minimum display requirements are considered to create assortments that work in practice.

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Alignment with strategy

The software adheres to your business decisions, such as including core products in all stores, when forming assortment recommendations.

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Self-service
analytics

Our assortment planning software provides both standard and customizable reports for efficiency analysis of product and category performance.

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Identification of gaps

The system makes it simple to compare market data with in-house data, to identify untapped potential in your assortment.

Feature highlights of RELEX’s clustering and assortment planning software

Bottom-up behavioral clustering of stores

While many retailers cluster arbitrarily by geography or store format, RELEX’s behavioral clustering lets you build store clusters bottom-up based on local demand. By understanding how shoppers evaluate different product attributes, such as brand, pack size and specific product features, when making choices, the software identifies in which stores categories are shopped in a similar way.

The software also recommends the ideal number of clusters per category to reflect shopping patterns. For instance, different customer groups may shop for fresh produce in a wide variety of ways, but all might buy paper towels similarly. Understanding what drives your customers’ choices means better targeted assortments, which enable you to sell more and waste less.

Create tailored assortments efficiently

Take advantage of our detailed analysis of consumer shopping patterns on a category and store level by letting the software automatically build recommendations for tailored assortments. Our advanced automation makes it possible to create category and store clusters or even store specific assortments in minutes.

Despite being fast and easy to use, the software takes all the complexities of assortment management into account; it handles local products, it takes the available space in each store into account, and it makes it easy for your assortment planners to set business rules, such as ensuring core items are available in all stores, to ensure that your assortment plans are aligned with your category strategies. Refining your local assortments so that they serve both your business goals and your shoppers’ preferences increases sales and improves margins.

“We’ve seen significant benefits. RELEX’s behavioral clustering solution has allowed us to quickly move from a generic [assortment mix] focused on group averages to one which is tailored in-line with our customers’ needs.”

– Egor Bakharev, Head of Competence Centre of Category Management, M.Video

Would you like to know more?

We are happy to discuss your retail optimization needs further, and show how taking advantage of behavioral clustering and assortment planning would streamline your daily operations.




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