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Merchandising involves arranging products for sale in a store. Effective techniques include placing attractive items in high-visibility areas and understanding the target market. Knowing the audience is crucial for successful merchandising, and developing a plan is important for large companies.
Merchandising is the process of arranging products for sale within a store or other setting. Effective techniques can help increase sales and profitability. Tips for successful merchandising include placing the most attractive or desirable items in high-visibility areas and understanding the target market for each type of item.
It is a well-known merchandising tenant that attractive or desirable merchandise attracts customers. Placing new, unique, or one-of-a-kind merchandise in a high-visibility area, such as a display case or lid, can help entice customers to enter a store or to linger after they enter. This concept also applies to attractive prices, which is why items with sale prices are often placed on supermarket lids or displayed in clothing store windows.
Perhaps the most important part of merchandising involves knowing the audience. This includes understanding their shopping habits so that products can be located properly within the store. For example, a product intended for children should be placed at a child’s eye level. A new product aimed at men should be placed in an area of the store where men tend to shop.
Understanding buying habits also helps in developing special merchandising efforts. For example, if a company developed a brand new specialty duster specifically designed to clean ceiling fan blades, the company might consider creating special screens for the ceiling fan sections of home improvement stores. This alerts customers that the product is new and different, and can draw attention to an item that shoppers might not notice in the cleaning supplies aisle unless they’re specifically looking for it. Placing related items can also encourage a larger sale.
Understanding the customer also helps determine how a product is presented. A customer shopping at a clothing boutique expects a very different presentation from a purchase at a discount store, for example. Some merchants design plans to feature the highest margin items in the most attractive positions so that each sale gets the highest possible return.
Developing a merchandising plan is so important that many large companies have individuals or even departments dedicated exclusively to this function. In these situations, it is also extremely important to understand how the contracts with the main suppliers affect the presentation of the products. For example, a convenience store might have contracts with two competing soda suppliers that stipulate that each supplier is allocated equal shelf space inside the refrigerators. To develop an effective merchandising plan, the merchant must understand this requirement.
Asset Smart.
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