MSAX the ne Xt generation of planogramming Launch

MSAX: the ne. Xt generation of planogramming Launch March 2008

Content Part I – General introduction – Methodology – Basic concepts – Creation of merchandising rules Part II – Step by Step Example – Automated planogramming for various stores and fixtures

Objectives – Part I Get familiar with the main features of new MSAX Transmit commercial wording of MSAX presentations Introduce you to how to handle and present the new MSAX – Methodology – Basic concepts – Creation of merchandising rules

MSAX Metodology Being an automated tool MSAX incorporates an important innovation in comparison to traditional planogramming tools: – Once the user has defined basic merchandising rules, the programm applies them automatically without manualities – The placement methodology is not any more executed by the user but fully rolled out by MSAX. The methodology combines cualitative and cuantitative factors in order to determine the placement of a product as refers to: – Where to place (best product to the best space) – How much to place (more rotation – more facings)

Basic concepts: Placement Area – Define the location of the optimal and least optimal placement area in the fixture. Buying zones: – Eye level – this is the best placement area, products usually gain in rotation when placed here. Defined by the red line and a surrounding green area. – Secondary buying zone – not as good as eye level, but still very attractive (. e. g – lowest shelf in Dairy with higher depth, hand level in standard shelf) – Low visibility – use if there is a column or other element that reduces visibility of or access to the shelf Implications in placement: – MSAX will place the best products in the best area (red line) and then follow the order of priority: red “eye level” line green blue gray red zone – If the green area contains various shelves, MSAX considers that the “better” shelf is the one closer to the red line (proximity rule). You can save and open previous areas to re-apply in new implementations.

Automatic Placement Workspace Selection of the variable used for coloring Move the blocks to create the order of priority (upper block will be placed first, lowest last) After having created the blocks get an idea of the adjustment of the size of the blocks to any of the included variables

Basic concepts: Segmentation Blocks Definition: a group of products that are displayed together due to a common characteristic like e. g. same segment, brand, product type, size… depending on the merchandising rule at the POS Creating the segmentation: The “segmentation” is the rule by which MSAX will segment and categorize the different products from the database Use logic terms to create inclusions like: – – IF segment = TOASTS IF brand = Private Label AND format = 50 THEN include in segmentation To insert rules at the right “decision level” click on the coloured dots that appear in the graphic representation after having defined the new logic term (first one inserted automatically between “All products” and “Segmentation”).

Basic concepts: Segmentation Blocks Other functions related to blocks: Facings – Define special facings like e. g. turned products or alternate stacking (one product standing, others lying on top of it) Horizontal/vertical – Define the direction of the placement order and rule (from left to right, top to bottom…) Grouping products – Group products placed within the same block by a certain variable (e. g: size or brand) Linking products – Link two or several products so that they will be placed next to each other mandatorily (e. g. : place private label product next to the corresponding leading brand product) Choose colour – This is how the block will appear on the general screen, helps to indentify different blocks.

Basic concepts: Placement Criteria Main question: Which products have the best performance? These will be placed first and in the best areas…. Define as many criteria as necessary and assign them to the different blocks by activating the respective boxes. You can insert various variables with different weight to create multidimensional criteria. Create company-specific variables and indices with the formula creator. Horizontal criteria: placement in line with shopper’s traffic flow or against. Criteria Blocks Variables

Basic concepts: Space Distribution criteria Main question: How many facings shall be given to the products? Criteria Blocks Usage as in placement criteria (see previous page). Usually criteria in this area will contain variables like rotation, unit sales, etc. Objective: avoid out-of-stocks by adapting shelf stocking to the real demand of the products. Variables

Basic concepts: Define Minimums Following the same logic as in the segmentation the user can define minimums for any of the variables he needs. All minimums can be set up specifically for a segment, brand, manufacturer, etc. Example – all products with more than 100 unit sales per week need to get a minimum of 3 facings. The user needs to take into account the product size!

Objectivs – Part II Make you familiar with the advanced features of new MSAX – Creation of multiple planograms based on multiple data and multiple fixtures types (highly important for retailers) Transmit the basic ideas behind the approach Explain the usage of the Example “Breakfast Section France” for various fixtures.

Files needed for demo What you need: – Installation of the latest MSAX version (beta 24 or higher) – Extract zip-file containing: Pictures of the example Sales data Base planograms Fixtures by store • Database translations: how to upload the French db • MSAX Settings: info needed for setting up the automation

What we’ll show The idea of the example is to: – Demonstrate the functionality of MSAX on several fixtures – Show multiple planograms (40) are designed for: • Different fixtures (5 sizes from 2 to 5 modules) • Different stores (adaptation to store data and local assortments) • Different merchandising rules (linked to base planogram) – Explain the underlying assumptions and necessary preparations IDEAL DEMO FOR RETAIL CLIENT ACQUISITION

The Example The example is based on data provided by an important retailer in France for the breakfast category (cereals, cookies, bread) It provides: – Assortments (not placed) and fixtures of 24 different stores belonging to five different clusters (two to five modules) AUTOstores – Sales data for 24 different stores AUTOdata – Five different merchandising pattern for each type of fixture (linked to the base fixtures) What MSAX will take the 24 base fixtures, update the assortments and create the placement according to the sales data of each store. The performance data will be taken as an indicator to optimize the space implementation: decide which products to include, where to place them and how many facings, totally adapted to the reality of each store.

Step-By-Step 1/7 Preparation of the program: – Set up the automatic data upload (please see word doc “MSAX Settings” for details of descriptors and columns order of store and product database) • Descriptors: – You will need to set up some additional descriptors in order to cover all the data provided in the original database • Store Database: Product Database: Browse for your path to the respective files Crucial: recreate exactly the same order as in the source file! Deactivate this option if you are using a database with different decimal settings

Check step 1: Confirm correct functioning of automation Before you move on, you may want to make sure the following: – Data automation: • Open from AUTOstores planogram Magasin_00055 • Change Store Code: open Store 00020 • You should see this window: MSA shows you the products that have been updated in the planogram If not… revise the settings After this just click Cancel and close the example. Attention: DO NOT save any of the changes that have been made

Check step 2: Confirm correct functioning of automation To confirm that the Automatic Placement is set up correctly: • Open planogram Magasins_00055 • Open Automatic Placement ( in “Analysis” or via button) • Click through the windows using the Next button. The Placement blocks should look like this, the end result like that. If not… revise settings, especially check if the sales data is being recognized correctly. Differnt decimal settings? Deactivate regional configuration or Change the systems decimals configuration

Step-By-Step 2/7 As an example you can create plans for a high number of fixtures, all of them with fixture-related merchandising pattern, different assortments and different sales data. Select Automatic placement for various fixtures: Select the different fixtures from AUTOstores:

Step-By-Step 3/7 Define the order of priority of the Product data selection: 1. 2. 3. 4. Select the products using automatic placement (selects store specific product assortment and sales data – retail functionality) Select the products from a text file (if all fixtures will contain the same product assortment) Use the products of the plan (to optimize the current implementation) Select the products from an MSA plan (to recreate/optimize a plan) Change order If the selected option is not found, MSA will use the next one.

Step-By-Step 4/7 Define the order of priority of the placement blocks: 1. 2. 3. Colocación automática del Planograma (retail) – bloques vinculados al muebles anteriormente SPD AT Pro Planograma con bloques (fabricantes) – crear varios planogramas en base a un patrón de implantación If the selected option is not found, MSA will use the next one.

Step-By-Step 5/7 Define the file names of the newly created planograms and a destination folder: 1. 2. You can maintain the original name (create a new destination folder) Or create a name template: a) b) c) d) e) f) 3. First decide which variable group you want to include Specify the variable Click on an existing row (on the number) “Insert before/after” Select next element …. [repeat until finished] When you’ve created the template click Next

Step-By-Step 6/7 MSAX will produce a table of the ocurred incidents: By clicking on “Open File” you will be able to access the planograms (one for each of the stores we are using, that is 24)

Step-By-Step 7/7 You can click through the different planograms to check that they all include different products and different modules: 3 modules 5 modules

Additional Demos In addition we can demostrate: – How to create the segmentation blocks – The basics of placement criteria and space distribution criteria – Placement for one fixture (optimization of an implementation based on sourcing new sales data as in a monthly amendment) – What is needed to do the automation of the data upload

Additional Service proposal: MSA Viewer MSAX can become a true Communcation system between headoffice and stores Improve communications between the headoffice and the stores by using automatized online-publishing of the master planograms per cluster, different modules and categories. Automatic publishing in internet Master plg. created in headoffice with MSA Cluster 5 Cluster 4 Cluster 3 Cluster 2 Cluster 1

MSA Viewer – technical layout MSA FILE HTTP SERVER (MFHS) A server to exchange the MSA files between different teams on the internet or intranet using HTTP protocol. Servidor HTTP / HTTPS Server (ISS Apache) MSA store 1 Plg. files Images library MSA store “n” Access control Resources Mngmt Rest of files (automation…)