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Best Practices

How merchandising helps retailers sell and succeed ❓

Aug 13, 2021 7 min read

Qvalon Blog article content

It’s estimated that the human attention span is 8 seconds on average. According to a study by the Technical University of Denmark, our collective global attention span is shrinking due to the abundance of information available.

Merchandising helps retailers

So here’s a question: What can you do to encourage passersby to explore your store when there’s plenty to keep them busy on the sidewalk?

Here’s where retail merchandising steps in. It’s a multi-pronged business process that can help you skyrocket your sales and spread brand awareness. 

There’s a widespread misconception that retail merchandising is merely an aesthetic endeavor. However, there’s more to merchandising than product and store layouts. Sure, the final output is visible in your window displays, but it’s never about what looks good—it’s more about what feels right.

What is merchandising

Merchandising refers to the way marketers influence consumers’ shopping decisions by using various marketing tactics. The goal is to drive up sales by showcasing the products at the ideal time, place, quantity, and price.

As a fairly broad term, it's not surprising that many people, including retailers, confuse merchandising with visual merchandising. And yes, visual merchandising, also known as ‘silent selling’, plays a vital part, especially for fashion brands—but that’s a topic for another time.

However, others believe merchandising involves the mathematics and analytics necessary to ensure business success. And they’re also right. Effective merchandising combines both creative and scientific concepts to move merchandise and increase profits.

Simply put: Merchandising requires a firm grasp of the products and plenty of analytical skills. It involves tweaking certain factors such as pricing, special offers, and display to find out which will motivate customers to purchase. 

Why is merchandising important

Ever wonder why retail giants and luxury brands spend heaps on their merchandising efforts?

Well, imagine looking at a nice pair of shoes online and deciding to buy them in person. Once you arrive at the store, you’re met with messy interiors, empty shelves, and an uninspired window display.

Will you still be interested in making a purchase? If you’re suddenly on the fence about it, it’s understandable. Although the product quality remains the same, your feelings toward it have changed because of the poor store experience.

But if you work on beefing up your merchandising tactic, it’s a different story. QVALON has witnessed the benefits of smart merchandising among its clients, with profits rising up to 50%.

To explain it in more detail, we’ve created a table that highlights the key difference between retail stores with retail merchandising strategies and those without:

Comparison table

Retail stores with
merchandising strategies
Retail stores without
merchandising strategies

It’s easier to determine projected sales and set goals.

Sales tend to be unpredictable

There’s a product strategy in place for seasonal items, so they can sell out faster.

Without a strategy, it’s difficult to prioritize which products need to be put out for display.

There’s enough storage space for incoming goods since seasonal products have been properly disposed of.

Storage problems arise because there’s plenty of leftover inventory.

In general, there’s minimal leftover inventory since you can easily put products up for discounts.

Disorganized inventory is hard to sift through, and now funds are insufficient to launch new merchandise.

Retailers are just in time to release a new product line.

Retailers are left scrambling for revenue, putting up their products at unprofitable discounts.

Seeing the table above, it’s hard to ignore the value of merchandising. Not only does it lead to increased revenue, but it also greases the wheels for your future releases.

Let’s talk more about why smart and effective merchandising is worth your while by diving into its numerous benefits.

Benefits of Merchandising

Benefits of Merchandising

  • It increases foot traffic and elevates the customer experience.

Having effective merchandising strategies ensures that your customers have an enjoyable shopping experience and leave them with a positive impression of your business. 

The storefront itself influences first-time customers’ decisions whether to come in and shop. An appealing exterior can convince them to look around. Not only that, but visual cues also enable your visitors to experience your brand, so both your new and existing customers can slide through their buyer’s journey much faster. 

  • It helps you provide better customer service by organizing your space.

Proper merchandising sometimes calls for an overhaul of the retail layout, including aisles, shelf displays, and fixtures. You can use this to make sure that your customers can easily search your shop for products and spot those currently on sale. 

The store layout also supports increased traffic. If you use retail spaces wisely, you can provide a smoother and more efficient shopping experience while having enough space to accommodate more shoppers.

  • It nurtures and strengthens your brand.

Merchandising enables visual consistency across multiple locations and online, and this consistency doesn’t go unnoticed. You can expect a positive impact on brand loyalty and awareness if your brand experience doesn’t waver.

Having a consistent brand is important to customers and can increase revenue by 33 percent.

  • It promotes brand loyalty and awareness.

As merchandising strengthens your brand, it becomes easier for customers to identify you. This is excellent news since a study found that high brand recognition decreased perceived risk and improved brand image and loyalty.

When it comes to awareness, merchandising techniques such as designing interactive store layouts and displays gives your customers something to talk about with their friends and family. It’s a simple yet effective way to generate word-of-mouth marketing buzz without doing much work.

  • It’s cost-effective.

Merchandising is a very powerful promotional tool, particularly suitable for growing businesses, due to its ease and affordability. 

Sales representatives can take charge of tasks, such as proper product rearrangement and shelf-monitoring, at no additional cost. If you want to automate the process and avoid missteps and mishandling, having a retail management tool is a wise investment.

  • It accelerates inventory turnover.

Merchandising can help your customers locate your products and present them in an appealing way. Choosing the right place to display your product isn’t a guessing game. CPG brands, for example, can leverage it so they don’t end up with plenty of expired inventory. 

Getting slow-moving products out in front of shoppers will help sell them faster. For instance, strategically placing those boxes of flour that will expire in six months at eye level can have a significant impact—especially if they come with discounted price tags. Then, just watch them sell like hotcakes.

  • It increases sales.

The goal of any business approach is to increase revenue, and successful merchandising can do exactly that. Merchandising increases sales by designing and displaying products correctly, explaining prices clearly, and making sure the shopping experience is pleasant. 

The secret to an effective merchandising system

To ensure that you develop a powerful merchandising approach, here’s where you should start: conduct a retail store audit

It allows you to find the gaps that your merchandising strategy is missing. It also provides you with visual consistency across multiple locations and online, which is one of the top struggles retail managers face.

You can often solve this problem by creating a checklist, but you still need to develop the concepts to make it reliable. With that, we reach full circle because the key to creating a useful checklist is to conduct an audit.

You can also make the process more efficient and manageable by relying on a retail management solution to handle in-store merchandising. It’s always been a struggle for most retail brands to streamline and monitor their retail sites, let alone do it remotely, but the right tool can solve all that.

QVALON helps develop a successful merchandising system that will save you hours of trials and errors. It also allows you to conduct audits, develop checklists, assign tasks, and monitor your employees in one mobile application.

Experience QVALON for yourself. Request a demo today.