Rite Aid restructures department to jump start marketing efforts

Drug Store News, April 7, 1997 by Lisa I. Fried

HARRISBURG, Pa. -- Rite Aid has reorganized its category management structure in an attempt to power up marketing efforts in the beauty (cosmetics, fragrances and toiletries), OTC, photo and greeting card categories, and aggressively explore new category concepts, according to Beth Kaplan, executive vice president of marketing for Rite Aid.

"There are certain categories -- beauty, OTC, photo, greeting cards -- that are destination categories for drug stores, and the most profitable categories in our stores. Yet in many cases they are underdeveloped," said Kaplan. "In addition, we have a real need to identify new business for the future."

Beginning April 7, Rite Aid will realign its category management structure into two departments: category marketing and category management. Both departments will report to Kaplan. The new structure is designed to help the chain drive sales and marketing programs in these core focus categories, streamline the organization and provide development opportunities for managers, Kaplan said.

Kaplan was hired by Rite Aid from Procter & Gamble last year to bring a more disciplined analytical approach to Rite Aid's marketing efforts.

The category marketing group, to be headed by Mary Verbryke, vice president of category management,will consist of four category marketing managers: Kathy Horton for beauty, Ed Kane for OTCs, Mike Novarro for photo and greeting cards and Linda Conway for new business development. Pharmacy marketing and purchasing will also be folded into this department.

The category management group, to be headed by Kevin Mann, executive vice president of category management, will consist of six category managers and 12 buyers. The category managers are Jeff Conley for tobacco/candy, Steve Koch for seasonal goods, Bob Jackson for food and beverage, Tim Bellows for sporting goods and Greg Carroll for paper and chemical. The stationery category manager position is currently vacant. The buyers will assist both category managers and category marketing managers. Category managers will report to Rod Kautz and Dan Hermes, directors of category management, who will report to Mann.

"Full blown marketing efforts weren't getting done ... because category managers were doing both broad stroke strategic planning and chasing the day-to-day details of the business, such as out-of-stock problems or vendor problems with ads," explained Kaplan. These details were supposed to be the responsiblity of the buyers, but inevitably wound up being shared by both buyers and category managers, Kaplan said.

Under the new structure, catgory marketing managers are expected to focus on driving sales and developing comprehensive marketing and advertising programs. Consequently they will be pushing many more day-to-day purchasing and store execution details down to buyers. "We have put strong buyers in those jobs," Kaplan said, noting that their responsibilities will be higher or broader than those handled by their counterparts in other categories.

"The category marketing manager's role is to develop category management plans and all related marketing activity regarding the categories (beauty, OTCs, photo, greeting cards and new business development) that are most critical to our growth over the next 18 to 24 months," Kaplan said. Their responsibilities will include overseeing television advertising, in-store marketing, pricing and advertising planning.

This shift in structure will enable Rite Aid to allocate most of its marketing dollars and attention to these categories, she said. In addition, it will make it easier for the chain to more aggressively pursue supply chain initiatives, such as efficient consumer response.

Category managers in the non-focus categories will continue to be responsible for developing category plans and overseeing assortment and logistics initiatives, and will continue to be assisted by buyers. They will also spend less time on marketing efforts than the category marketing managers.

"This modified structure will enable Rite Aid to further strengthen our category management focus," she said. "It frees up seasoned managers to focus on strategic and long-term marketing initiatives while ensuring day-to-day business needs are met. More important, these changes should help drive growth in front end sales and profitability."