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Product Management and the Changing Nature of Retail Jobs

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Product management is central to retailing because product range must effectively communicate with the consumer, the focus of the retailer's business. Product management in retail organizations is a crucial component and embraces a wide range of tasks and functions. People in retail jobs know that in most large retail organizations, product management is as much of a key functional area as financial, human resources, or systems management. As the scale of retailing operations escalates, other functions like marketing and logistics are integrating themselves as parts of product management within the retail organization.

The retail product range contributes significantly to the strategic success of a retail business. It is through their product ranges that retailers implement their pricing strategies and profitability levels, and it is through managing their product ranges that retailers succeed in maintaining the consumer's interest. Proper product management also allows the retailer to quickly and visibly respond to changes in consumers' shopping patterns. Over the years, the retail industry has evolved to adapt to structural changes in the economies of nations, and the highly specialized model of retail product management one sees today is a product of the last few decades.

At one time, the retail salesperson was considered the most integral member of the retail business. In some retail institutions, such as department stores, retail salespersons frequently worked their way up through the organization, from the sales floor to department management. In many modern retail companies, such as chain stores, the retail salesperson's experience is still valued highly, and although retail salespersons are now more likely to be graduates, they still have to spend time gaining product and supply knowledge and generally becoming familiar with the retailer's strategic and operational aims.



In the late 1970s and through the 1980s, the centralized mega-retail organization ushered in a new approach to buying and essentially split the retail salesperson's role into two. One role involved offering and managing qualitative considerations (product selection), and the other involved quantitative considerations (merchandising). Then, shifts in product management trends caused the retail salesperson's job to change once again. People in retailing jobs now had to concentrate on getting the product details right and focus on selecting suppliers based purely on business considerations. The retailer's qualitative function extended to promoting suppliers who could meet the required price and service standards in terms of delivery, technical skill, and capacity. In the meantime, the retailer's quantitative function extended to sales forecasting, stock planning, and product management.

During the 1990s, a new trend that can be loosely termed "consumer-led product management" gained precedence in the market. Rather than basing product management on forecasting what consumers would buy, flatter and more efficient retail organizations took product management a step further by continually aligning in response to consumer demands. This was an adaptation by retailers of the brand management approach of big producers of fast-moving consumer products. Modern retail product management now started developing and relying on multi-functional teams that focused on specific product and product category performance. Retail product management integrated marketing strategies learned from brand management to develop product category management in the retail industry. The job of the retailing executive now broadened, and product category management once again fused together the quantitative and qualitative aspects of retailing, albeit along with the integration of marketing strategies.

Today, with the growth of customer orientation, product management in retailing has broadened in scope. According to the nature of the retail organization, the product range may offer a wide variety of merchandise, or it may focus on narrow bands of specialty products. The modern product management process in retailing has converted functions like procurement, logistics, and implementation of range formulation at store level into specialized functions and evolved functional job roles in every area. Retail product management now involves the management of specific products from conception to sale within market-relevant product categories. Jobs in retailing have similarly evolved from generalized to specialized functions to support the evolution of new retailing structures.

Reference

Varley, Rosemary, and David Gillooley. Retail Product Management: Buying and Merchandising. London: Routledge, 2001.
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Popular tags:

 integrated marketing strategy  ranges  systems management  management  retailers  consumers  economy  graduates  consolidation  merchandise


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