Introduction

• Pages: 1-2

1

INTRODUCTION

“Category management” is a relatively new concept that has become

ubiquitous in some segments of the retailing industry. When a retailer

engages in category management, it often designates a principal supplier

in a particular product category as a “category captain” to help the

retailer make decisions maximizing profits across all suppliers’ products

in that category. This practice has become widespread in the marketing

of consumer goods.

Category management has been the focus of at least two high-profile

private antitrust lawsuits.1 The FTC devoted a chapter of its 2001 report

on slotting allowances to the subject.2 The agency has also conducted

investigations into the manner in which several large grocery suppliers

have dealt with retailers in the context of a category-management

relationship.3 More recently, the FTC reportedly has opened an ongoing

investigation into the potentially anticompetitive use of category captains

in the retail sale of condoms.4 In other countries, the antitrust authorities

have addressed category management in some of their guidelines.5

1. Conwood Co. v. United States Tobacco Co., 290 F.3d 768 (6th Cir.

2002); El Aguila Food Prods. v. Gruma Corp., 301 F. Supp. 2d 612 (S.D.

Tex. 2003), aff’d, 131 F. App’x 450 (5th Cir. 2005).

2. Fed. Trade Comm’n, REPORT ON THE FEDERAL TRADE COMMISSION

WORKSHOP ON SLOTTING ALLOWANCES AND OTHER MARKETING

PRACTICES IN THE GROCERY INDUSTRY (2001), available at

http://www.ftc.gov/os/2001/02/slottingallowancesreportfinal.pdf.

3. See, e.g., Fed. Trade Comm’n, Analysis of Agreement Containing

Consent Orders to Aid Public Comment, In the Matter of the Procter &

Gamble Company and the Gillette Company, File No. 051-0115 (Sept.

30, 2005), available at http://www.ftc.gov/os/caselist/0510115/

050930ana0510115.pdf.

4. See Condom Category Captain Case, 741 FTC WATCH 1, 1-3 (May 4,

2009). The investigation centers on Trojan condoms, the largest selling

brand of condoms in the United States. Id. at 3. The manufacturer,

Church & Dwight, reported in its May 2010 quarterly report that it has

received a subpoena and civil investigative demand and that the FTC is