What Is Happening to My Categories? Differential Effects of a Radical Store Transformation on Category Sales

Hermans, Marleen; Breugelmans, Els; Lehmkuhle, Felix; Krafft, Manfred; Kroschke, Mirja; Mantrala, Murali

Abstract

Today, many retailers radically transform their physical stores to meet changing customer preferences. Typically, such store transformations emphasize certain categories that align with the new positioning, de-emphasize categories that do not, and keep a significant portion of categories unchanged in assortment size, composition, and presentation. This study deals with the impact of a radical store transformation on category performance and investigates how this effect differs depending on whether a category is emphasized, de-emphasized, or remains unchanged. Results from a quasi-experimental analysis of a radical transformation of a German grocery retailer reveal a positive (negative) effect of the transformation on sales of emphasized (de-emphasized) categories. Interestingly, unchanged categories also experience a negative effect. Subsequently, the study probes which unchanged categories are more or less adversely impacted depending on their category characteristics (8Ps): purchase frequency, penetration, perishability, price level, processed level, promotion intensity, portfolio, and private label share. The research finds that the transformation effect on sales is more negative for unchanged categories that are comprised of processed/ready-to-eat goods, have a higher purchase frequency and higher prices, but less negative when unchanged categories score high on perishability, promotion intensity, and private label share.

Keywords

Quasi-field experiment, Store transformation, Category performance, Unchanged categories, Category characteristics

Cite as

Hermans, M., Breugelmans, E., Lehmkuhle, F., Krafft, M., Kroschke, M., & Mantrala, M. (2026). What Is Happening to My Categories? Differential Effects of a Radical Store Transformation on Category Sales. Journal of Retailing, 102. (accepted / in press (not yet published))

Details

Publication type
Research article (journal)

Peer reviewed
Yes

Publication status
accepted / in press (not yet published)

Year
2026

Journal
Journal of Retailing

Volume
102

Language
English

ISSN
0022-4359

DOI

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