E-commerce assortment optimization

What are the key to success of an e-commerce food assortment ?

A leading food retailer wanted to optimize the e-commerce food assortment at store level.

E-commerce represented more than 7% of food retail in France in 2021. It is the distribution channel that is experiencing the strongest evolution in the market with a 15,8% growth in 2021. Optimizing the e-commerce assortment then becomes a major stake for retailers.

Based on its experience in store assortment, Memory has adapted its methodology to the specifics of the E-commerce market to both improve sales performances and to save time in assortment building activities.

This was achieved in three different steps:

1. Delivery of a comprehensive diagnosis of the e-commerce specific shopping patterns: loyalty, category mix, brands vs PLs, cross-purchasing with physical stores
2. Design of the guiding strategic principles: assortment size, priority client groups, priority categories, average price offering, brands vs PLs, organic…
3. Optimization of the assortment at store level, taking into account the strategic principles and operational constraints (pack size, inventory), and leveraging all the shopper database to assess complementarities and cannibalization between skus

The project first resulted in an assortment recommendation which was implemented in test stores. Then it led to the delivery of a dynamic assortment building tool connected to the client's internal tools, which also allows to identify the best substitute products in case of out-of-stock.