Herb Sorensen, Ph.D.

Chains Continue to Rationalize SKUs

June 16, 2010

FROM RETAILWIRE:
Despite some evidence that consumers do not take kindly to having their favorite brands taken off the shelf, more than 40 percent of retailers plan to cut SKUs this year, according to Nielsen. Do you think that SKU rationalization efforts at retail in recent years have been successful or have they gone too far?      [more...]

In my paper, "The Misguided Bobbing of the Long Tail," I make no effort to address what the exact length of the long tail should be, but simply point out that self-service retailers, particularly, totally mismanage the big head, which is where the money is to be made. As long as you use the long tail to "hide," or dilute, the big head - standard, stupid practice - it really doesn't matter how many pennies you lose out there in long tail country, while you flush major opportunity - dollars - in big head city.