Retail merchandising is one of the most important marketing techniques that play an important role in a store’s sales velocity. While the science of it can be diverse—with many strategies being relevant depending on the goods being sold as well as a business’ overall direction—there are core concepts that can be considered foundational to its application. If you are a business owner who wants to improve your establishment’s impact and demand, the following rules below can get you in the right direction.
1. Have a pricing strategy
The pricing of your products actually plays a big role in your merchandising strategy. The first thing you have to understand is that the more expensive the goods are, the slower the rate of your sale. Think of your business’ pricing plan in a bell curve. On one side are your higher tier goods that make up 10 percent of your store’s collection and on the other side are your promotional goods (items on sale) which also contribute the same percentage to your overall store inventory. There in the middle, however, are your average-priced goods, or your bread-and-butter merchandise which generates the most profit for your business.
Now, if you apply this to the concept of merchandising, you know that you have to position your bread-and-butter items in a place where they can be easily accessed by your regular consumer. These are the ones that you usually put in regular standees, often at eye level of your customer so they can easily be grabbed by someone who is particularly visiting your store for them.
On the other hand, right beside these products should be your high-ticket items and your items on sale. Marketing studies say that a huge percentage of sales of these goods are from the last-minute decision of buyers, so if there is a collection you want to push, it’s important that you put them in the right place, aka near the spot of your most well-bought items.
2. Know which retail displays to have
Your pricing strategy is also a good reference point for your choice of retail signages. Retail displays, both indoor and outdoor, have two main purposes: first it to get customers through your door, second is to encourage them to make a sale. Your promotional products and deals are best to be showcased on your outdoor displays because it encourages people—especially new customers—to check your store out. Your indoor merchandising strategy inside is a different story though. Since your potential customer is already inside your turf, it is your chance to also convince them to try your high-ticket items. This is where you can apply different display strategies to put your goods in the spotlight, such as using roll-up displays or even promotion booths where you can have a dedicated crew to interact with in-store visitors.
3. Consider the shelf life of your merchandise
By general rule, your inventory should last an average of 90 days, especially if your business heavily leans on seasonal goods. Of course, the rules may change if you are a high-volume store, but this is the general amount of time that you can display relevant items especially if you are a specialty retailer. Don’t consider yourself a seasonal business? Do not think you are off the hook quite yet. When it comes to merchandising, you have to consider who is actually buying your products to come up with a good marketing strategy. This goes beyond the average demographics and psychographics that most stores analyze—if you really want to make the most out of your merchandise, consider looking at your goods through the lens of lifestyle marketing, a concept that looks at the overall behavior of your consumers. A good example of a store that follows this is the Japanese label Muji which, instead of focusing on a certain roster of goods, sells products based on the lifestyle aesthetic of their customers.
4. Put yourself in your customers’ shoes
On the other hand, don’t forget to still consider the overall experience of your customers when thinking of your retail merchandising display strategies. For example, if your main target is females, you have to consider the way they may potentially move once they get in your store. Here’s one good example: most women have an average height of 5”4 so your retail displays should be easily accessed by people with this height. Eye-level is also something to consider as well. Your best-selling products, as well as the items you need to give an extra push, should be the first ones to greet the line of sight of a potential customer.
Retail merchandising can easily get granular and specific, but the concepts above are some of the most basic ones that can help you design a foolproof marketing plan.
