“Modern Retail Merchandising” : The Art of Mathematical Magic | by: Bhavna Chadha | ET Retail


In the broadest sense, “Merchandising” is any practice, which contributes to the sale of products to a retail consumer. At a retail in-store level, merchandising refers to the variety of products available for sale and the display of those products in such a way that it stimulates interest and entices customers to make a purchase. How a product stands out on the store shelf often determines its fate in the Buying Decision Process of the customer.

Buying Decision process :

The retail store’s shelf is the final battleground for the consumer’s rupee. If it’s advertising that gets customers into the store, it’s merchandising that gets them to select one product over another , once they’re there. In fact, recent data from the Point-of-Purchase Advertising Institute suggest that 70 % of supermarket shoppers and 74 % of mass-merchant shoppers make their purchase decision inside the store. For many marketers, this strengthens the case that in-store merchandising just might be more important than media advertising. In-store merchandising is also the last chance to present shoppers with information about a product’s features, benefits, price, and positioning. 

The Merchandising Process :

The most important processes in , in-store merchandising are the following – 

Category management – This is becoming increasingly important to retailers. A manufacturer’s merchandising strategy, focused on its specific brands, might be at odds with the retailer’s, which is aimed at increasing sales–and profitability–of the merchandise category as a whole. Manufacturers that show how their merchandising efforts will contribute to the retailer’s objectives are more likely to win the retailer’s in-store support.

Category captains – Many retailers rely on the largest supplier in a particular category to help plan and manage the category as a whole. This tends to squeeze out smaller vendors.

Carrying out the program – Retailers are looking to shift more and more of the burden of putting products on display to manufacturers and their representatives.

Floor-ready merchandise – Larger retailers are trying to eliminate the time and cost involved in ticketing merchandise and otherwise preparing it for display.

Slotting fees are often an issue for new-product merchandising. Since new products are inherently risky, some retailers will demand an extra payment in exchange for making shelf space available.

Merchandisers Role : 

Major packaged-goods companies might have merchandising sales forces large enough to go into stores twice a week to freshen displays, deliver POP materials, and provide product information and training materials for retail personnel, but they are the exception, not the rule. Among the important services that a typical merchandiser can provide are :

  • Set up and maintain permanent merchandising displays such as end-caps, and other specialized fixtures for limited-period displays.
  • Make product presentations to retail customers and run sampling stations or demo machines for grand openings or other in-store events.
  • Monitor inventory and pricing of your products.
  • Check on and improve the number of facings and placement of your products.
  • Verify store compliance on paid-for merchandising display (such as end- caps) and merchandising materials (such as shelf-talkers or danglers).
  • Conduct on-site surveys of store customers.

Merchandising Strategy For Independent Retailers :

The critical strategic advantage of any independent retailer is the ability to focus on, and respond quickly to, customer needs, while providing a superior level of customer service and state-of-the-art product knowledge. In other words, independent retailers should avoid competing on the basis of price, because there will always be a competitor with larger, deeper pockets who will be able to undercut them. And they should look at the traditional model with a different view.


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