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The Importance Of Product
Placement In the Retail World
   Many consumers that stroll into a retail
    store looking to do a little shopping,
    really have no idea about the thought
    and work that went into the placement
    of all the products on the shelves.

   Product placement in retail stores is
    about so much more than just what
    looks nice where, or what may fit the
    best in different areas of the store.
   There is a definite science to placing products in
    retail stores, and the better a business is at doing
    it, the more sales and more profit they will make.

   It all starts with how the general consumer thinks
    and acts when he or she enters a store.
Consumer Behaviour
   Where certain types of items are placed within the store falls right
    into how the common consumer thinks and acts. Everyday
    items, also know as ‘destination’ items are often placed toward
    the interior or back part of a store.

   This way, you and I must pass right by strategically placed
    impulse items in order to get to them. This means:

        You must pass by scores of other products, increasing the likelihood of
    ◦
        buying one or more of them.
        You will remain the store longer, meaning you’ll be exposed to in-store
    ◦
        marketing longer.
        The store controls what you see and how you see it.
    ◦
        These factors mean that products, signs, offers and promotions can be
    ◦
        placed at eye level on the journey back to get those items you went for in
        the first place.
        It enables the merchandisers and marketers to grab attention and pull the
    ◦
        consumer in, because they know the window is not very big.
Consumer Behaviour
       Precisely where and how a product is positioned on store shelves can either send sales through the roof or make them never
        really reach their full potential. Both temporary and permanent displays are often used to divert a consumer’s attention from
        his or her original goal.
 
       Some of the visual product placement techniques retailers use to capitalize on consumer behaviour includes:

  Block Placement – this is when items that are related to one another are placed together.
  Vertical Placement – this refers to merchandise being displayed on more than one shelf level.
  Commercial Placement – items with a higher perceived value are given more desirable shelf position, while items that
don’t add much to the bottom line are given less desirable space.
  Margin Product Placement – the more profit an individual item gives the retailer, the better position it will receive.
  Market Share Placement – the highest revenue generators are placed in spots that customers can easily find them.

       Some studies suggest that consumers scan shelves from left to right, starting at eye-level first and then working down. Many
        savvy merchandisers and retailers will take this into consideration when laying out the product placement for a store.
Planograms
   A planogram is a tool that retailers use to assist in
    the merchandising process. Basically, a planogram
    is a drawing or visual diagram that details where
    every product should be placed inside the store.

   The detail extends to specific departments in the
    store, specific aisles and even specific shelves.

   A planogram is created by using software that’s
    designed for that specific task.

   A planogram may be very complex or relatively
    simple depending on the size of the store and
    number of products on the shelves.
Planograms
   Planograms definitely help with the science of
    product placement and increasing sales, but they
    also have other goals, including:

    ◦ Improving visual appearance to please customers
    ◦ Better inventory control and fewer ‘out-of-stocks’
    ◦ Utilizing every square foot of space to maximize selling
      potential
    ◦ Easier product replenishment
Important Tips
   Whether you shell out big bucks for an expensive
planogram, devise a system on your own computer or use a
paper and pen, there are several factors to consider in the art
of product placement. Some important tips to consider are:

  ◦ When creating your placement strategy, leave enough space for
    customers to move through in both directions. Leave space for
    carts going both ways if your store uses them.


  ◦ Make the checkout area and customer service area visible to
    customers when they enter the store.
Important Tips
 ◦ Consider laying out the aisles in a horseshoe pattern, with
   in-demand items near the start.

 ◦ Experiment with placing both high selling items and slower
   selling items at eye-level, to see which approach yields
   higher overall sales.

 ◦ Make the lines of sight as uncluttered as possible to help
   make the store appear cleaner and deter shoplifting.

 ◦ Even though it may be tempting, try to avoid overstocking
   shelves as it might overwhelm customers.

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The importance of product placement in the retail

  • 1. The Importance Of Product Placement In the Retail World
  • 2. Many consumers that stroll into a retail store looking to do a little shopping, really have no idea about the thought and work that went into the placement of all the products on the shelves.  Product placement in retail stores is about so much more than just what looks nice where, or what may fit the best in different areas of the store.
  • 3. There is a definite science to placing products in retail stores, and the better a business is at doing it, the more sales and more profit they will make.  It all starts with how the general consumer thinks and acts when he or she enters a store.
  • 4. Consumer Behaviour  Where certain types of items are placed within the store falls right into how the common consumer thinks and acts. Everyday items, also know as ‘destination’ items are often placed toward the interior or back part of a store.  This way, you and I must pass right by strategically placed impulse items in order to get to them. This means: You must pass by scores of other products, increasing the likelihood of ◦ buying one or more of them. You will remain the store longer, meaning you’ll be exposed to in-store ◦ marketing longer. The store controls what you see and how you see it. ◦ These factors mean that products, signs, offers and promotions can be ◦ placed at eye level on the journey back to get those items you went for in the first place. It enables the merchandisers and marketers to grab attention and pull the ◦ consumer in, because they know the window is not very big.
  • 5. Consumer Behaviour  Precisely where and how a product is positioned on store shelves can either send sales through the roof or make them never really reach their full potential. Both temporary and permanent displays are often used to divert a consumer’s attention from his or her original goal.    Some of the visual product placement techniques retailers use to capitalize on consumer behaviour includes: Block Placement – this is when items that are related to one another are placed together. Vertical Placement – this refers to merchandise being displayed on more than one shelf level. Commercial Placement – items with a higher perceived value are given more desirable shelf position, while items that don’t add much to the bottom line are given less desirable space. Margin Product Placement – the more profit an individual item gives the retailer, the better position it will receive. Market Share Placement – the highest revenue generators are placed in spots that customers can easily find them.  Some studies suggest that consumers scan shelves from left to right, starting at eye-level first and then working down. Many savvy merchandisers and retailers will take this into consideration when laying out the product placement for a store.
  • 6. Planograms  A planogram is a tool that retailers use to assist in the merchandising process. Basically, a planogram is a drawing or visual diagram that details where every product should be placed inside the store.  The detail extends to specific departments in the store, specific aisles and even specific shelves.  A planogram is created by using software that’s designed for that specific task.  A planogram may be very complex or relatively simple depending on the size of the store and number of products on the shelves.
  • 7. Planograms  Planograms definitely help with the science of product placement and increasing sales, but they also have other goals, including: ◦ Improving visual appearance to please customers ◦ Better inventory control and fewer ‘out-of-stocks’ ◦ Utilizing every square foot of space to maximize selling potential ◦ Easier product replenishment
  • 8. Important Tips Whether you shell out big bucks for an expensive planogram, devise a system on your own computer or use a paper and pen, there are several factors to consider in the art of product placement. Some important tips to consider are: ◦ When creating your placement strategy, leave enough space for customers to move through in both directions. Leave space for carts going both ways if your store uses them. ◦ Make the checkout area and customer service area visible to customers when they enter the store.
  • 9. Important Tips ◦ Consider laying out the aisles in a horseshoe pattern, with in-demand items near the start. ◦ Experiment with placing both high selling items and slower selling items at eye-level, to see which approach yields higher overall sales. ◦ Make the lines of sight as uncluttered as possible to help make the store appear cleaner and deter shoplifting. ◦ Even though it may be tempting, try to avoid overstocking shelves as it might overwhelm customers.