Mind Over Money: An Insider’s Guide to Merchandising Basics

Monday, 6 April 2009 | Tags: , , , ,

When you walk into most stores, you may not realize how much thought has gone into the placement of product displays, lighting, clothing racks, and even the cash register. We get some insider tips on how the art of merchandising affects our shopping experience.

We talked to merchandising expert Melanie McIntosh to learn some basic tricks of the trade when it comes to transforming a retail space into a shopper’s delight.

The Basics

A simple definition of merchandising is the art of setting up products to promote purchasing. Done effectively, shoppers will not only be enticed into the store from the street, they’ll also leave with items, including a host of additional related and unrelated treasures.

External Attractors: Windows

Store window displays create eye-catching interest to draw buyers into the store. Displays need to be engaging without being busy, and usually tell a “story” about how the featured products fit into the lifestyle the store is promoting. Window displays include products, signs, logos, lighting, related props, and even music to appeal to a customer’s lifestyle aspirations.

Internal Experience

Once inside the store, the customer experiences the “flow” of the merchandising strategy, which typically aims to guide traffic on a specific path through the store to maximize exposure to products. Ever walk into a store and feel the need to touch things? That’s merchandising hard at work! Studies show that the more you touch the products, the more likely you are to buy.

The placement of different vignettes of products is carefully planned as customers venture into the store. For example, we went to a Wear Else location that featured simple, multi-level table displays of clothing and accessories placed in unique ways so as to invite interaction. The multiple levels allowed for an engaging display, but were “see through” so that they didn’t create a barrier to exploring the rest of the store.  

Also, colours on this entrance display picked up colours painted on the back wall of the store, again drawing us in. Did you know that most North American shoppers tend to walk into a store and move to the right? And that’s where key pieces of merchandise are often placed in order to grab the customer’s attention.

The cash desk is thus usually placed near the front left of the store.In our demonstration with Melanie McIntosh at the Wear Else store, however, they did things a little differently. The entrance was at the left of the store, and the track lighting highlighted the left display wall areas, and drew us in and showing a direct path through the store.

The back of the store is where you may find either high-priced or high-demand items, as well as sale items, both of which require the customer to pass through the full store to reach them. This increases the chances of attracting customers to other products along the way.Some stores create an elaborate journey that takes the customer past almost every single product available. (IKEA is an extreme example.)

Merchandising Must-Haves

Popular items are distributed around the store within sight of each other to guide your attention from one to the next.

Mirrors and reflective surfaces tend to attract and slow people down. This effect creates areas where customers can “connect” with products.

In clothing stores, dressing rooms are as important as the sales floor because they are the location where people tend to decide whether to buy an item or not. Studies show that a clothing shopper who speaks to a salesperson is twice as likely to buy something than one who doesn’t, which has led many retailers to focus more attention on the dressing rooms, with full-time attendants, better lighting and mirrors, a comfortable-sized space, and even flowers. These tactics help to put shoppers in a positive state of mind, thus making them more likely to buy.

Merchandising No-No’s

Bottlenecks: aisles should be wide enough for two people to pass comfortably without bumping each other. People hate line-ups, so don’t inadvertently create them!

Dead spots and inaccessible areas: good flow is created by opening up spaces.

Avoid blocking the customer from accessing the products, unless, of course, it’s something like diamonds or high-value products that are also common targets of theft. Needing to ask a salesperson to see or handle and item often creates a barrier to purchase.

A Quick Primer on Display Tactics

The way products are displayed depends greatly on the type of store and products, and the mindset of the typical customer entering the store. The difference between merchandising a gift store and a sporting goods store is vast. One is all about ambiance, while the other is about ease and speed.

Different arrangements of products in a display have different effects on how shoppers will experience them:

  • Left-to-right arrangements, for example, by colour, size, or price, invites a comfortable reading approach. Up-to-down arrangements do the same.
  • The centre “triangle balance” is the theory that the eye goes to the centre of a display first, which is where merchandisers place the biggest, tallest, highest profit margin products.
  • The colour camouflage tactic separates different colours of the same product across different shelves or throughout the store. This gives the impression that each colour is exclusive.
  • Creating focus in a display and also arranging products in a relationship helps create the potential for upselling more products. For example, placing a handbag with a bracelet or sunglasses may inspire customers to purchase more than just one of the products.
  • The way products are oriented within a display also plays into how shoppers experience them. For example in our demonstration store, a blouse (left) was grouped with a pair of shoes (middle) and a bag (right). The toes of the shoes pointed “in” toward the blouse, instead of “out” away from the blouse, creating a curvilinear vignette that was pleasing to the eye. It’s like creating a still life!
  • Mannequins show customers what’s hot for the season, and are usually placed next to the related clothing racks.
  • Eye-level is an important placement area for high-turnover items and sale pieces. Supermarkets are leaders in this tactic, placing the most profitable brands at eye-level. Value-priced brands are usually placed on the lower shelves where they are harder to reach.
  • Clone products (i.e. store brands that mimic name brands in size and colour) are often placed one shelf lower than the prime eye-level brand, or even mixed in amongst the brand products according to size or ingredients. (Think name brand headache remedies vs. store brands as a good example.)
  • End caps, the display units placed at the ends of aisles, highlight products related to items in the main aisle. Products in end caps tend to be high impulse buys.
  • Impulse buys, mostly inexpensive and small, are placed near checkouts and exits to grab the attention and drive last-minute add-on sales.

It’s All in the Atmosphere

The ‘feel’ of a store should be designed to invite customers to enter and to get comfortable, thereby enabling them to picture themselves in the “lifestyle story” created by your displays and vignettes.

Emotional response like pleasure, arousal, dominance, or a combination of all three, is the goal of atmosphere tactics. There are many ways to create atmosphere. Here are a few:

  • General, fixed lighting is accented with adjustable lighting of various colours focused on particular displays. Task lighting is used in cash or work areas.

  • Openness is a trend that helps inspire relaxation and comfort, removing noise and thereby helping you feel informed with focused information before your purchase. (E.g. the Apple store)

  • Witty, unusual displays provoke interest and inspire confidence in the retailer’s taste and cultural opinion.

  • Multi-sensory vignettes that appeal to all dimensions have a high impact on shoppers. People buy more groceries when hungry, which is why fresh bread smells sell food.

  • Mess vs. neat: for a younger audience, disorganized displays of handled clothing suggests popularity. Too neat and it implies no one is buying. Older audiences are more attracted to tidy displays.

  • Music sets the mood. In a clothing store, music is a critical part of the style for a younger audience. (Don’t play last year’s hits!) It can also drive sales by putting people in the mood. For example, French music puts people in a mood for French wine, while German folk tunes sets up customers for an evening imbibing German wine or beer.

Your Favourite Store Knows You Well

Merchandisers put a lot of effort into finding out the wants and needs of potential customers in order to inform their merchandising strategy. Things like geographic location, neighbourhood profile, and a number of other factors go into this strategy.

Discovering the right layout, display style, atmosphere characteristics, etc. is an ongoing process of refinement. Experimentation is key to merchandising a retail store.

Buyers Beware!

If you’re trying to watch your budget, keep these merchandising tactics in mind next time you’re shopping. See how many you can identify, and resist!


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