April 12, 2007
CPGmatters: Eye-Catching Shelves
By Al Heller
Through special arrangement, what follows is an excerpt of a current article from the CPGmatters monthly e-zine, presented here for discussion.
(www.cpgmatters.com)
More CPG manufacturers nowadays are evaluating the category structures in place. Are they getting to consumers’ sweet spots? The way they position needs to align with how consumers approach the category and their need-state on that shopping trip.
“The industry hits consumers with lots of SKUs, line extensions, products and messaging. It’s not really working. Consumers can’t process all that,” said Lily Lev-Glick, director of shopper insights and point-of-sale research for Perception Research Services (PRS) in Fort Lee, N.J.
She gave the example of her firm’s eye-tracking studies of planograms, line optimization and packaging. In analgesics, consumers may see a lot of information on form or ingredients, but they don’t readily see the personal relevance of symptomatology or end-user benefit. “Similarly in lighting, people see wattage or long-lasting features, but they want to see phrases like ‘ambient lighting for your entertaining,’ or ‘bright light for your reading comfort,’” Ms. Lev-Glick explained.
Although a better job by CPGs at the shelf won’t alter a consumer’s pre-purchase hierarchy, “brands can change what people ultimately select. On a visceral level, looking good raises an eyebrow, but it’s the cognitive part of the process — the message, the connection, the like-mindedness of the category to the consumer — that will make the sale,” she said.
“If a brand thinks and speaks the same language, and consumers can relate back to these benefits, we go beyond products that get only an initial response to those that build relationships based on deeper end-user benefits and life impact. Of course, the at-home experience will really determine whether or not that consumer maintains a relationship with the brand,” she added.
CPG brands can have more of an impact by better synchronizing messages between packages, promotions and point-of-sale signage, according to Ms. Lev-Glick. Different messaging creates a lot of noise for consumers. “We have an opportunity to help support brands and build relationships, but not when we’re doing these divorced from each other,” she added.
Eye-tracking shows by physiological response what breaks through the clutter. That is where consumers start to navigate the shelf, and it is where retailers and category captains have to structure the shelf as closely as possible to a category hierarchy, according to Ms. Lev-Glick who gives an example with analgesics. If the category is driven primarily by brand and the shelf is set by symptom, confusion is created.
She gave two examples of branded items differentiated through package form and graphics with juices in novel easy-to-hold shapes, and bottled waters with rings on caps. “Take a little leap of faith with the right research so you can differentiate yourself, and have an appearance that allows you to own a particular dimension,” she urged. “Also see if you can make a unique claim that is real and true (ammonia-free Glass Plus), or own an end benefit (the most fun, the most efficacious). It gets back to behavioral and attitudinal purchase drivers. Understand what drives interest in your brands, and how they own particular mental spaces in consumers’ minds.”
Discussion Questions: What was your reaction to the articles’ point: “If the category is driven primarily by brand and the shelf is set by symptom, confusion is created.” Does the CPG industry need to rethink shelf sets to better speak to consumers’ end-needs?
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The article has uncovered a very clear “call to action” for the industry and there are recommendations aplenty that could and should evolve from this insight to reduce confusion at the shelf. The only thing that jumps out at me (having read the original posting in CPGmatters)is the thought that this cannot be seen as a “manufacturer issue” to resolve. If anything, the larger opportunity may be that the retailer will need to recognize the enormous potential of the shelf/department/section to “sell” for itself on their behalf and as a strategic differentiator.
All too often in the industry the assumption of responsibility (or the doling out of blame) tends to run along “us” vs. “them” lines. This is an opportunity for BOTH manufacturers and retailers to reconfigure how they approach the merchandising of products and align in a way that accomplishes their goals much more successfully than is at times done currently.
Working with retailers and manufacturers over the last year on initiatives very similar to this one, the interest and success of efforts have proven to be enormously successful. The next generation of thinking in the industry has arrived and it focuses on what Category Management could not and did not–the experience.
An extremely valid point of view. Shelves, assortments, and planograms are more often than not arranged by ‘how retailers source’ and ‘how brand marketers classify’ categories, rather than by ‘how shoppers shop’ them. In many cases, the obvious is not always the most apparent. Making shelves shopper-centric not only makes it easier and more relevant, but encourages more purchases and increases the size of the basket. A project we recently did for a Biscuits major in India proves this. Historically, the category was stacked based on manufacturer/retailer product groupings- Glucose, Marie, Salted, Cookies, Cream, Digestive etc. On studying how shoppers shop the category, we discovered that they don’t shop by this grouping at all. They shop by ‘occasion/type of use’–tea time, treats, snack, for kids, health, etc. The entire category was rejigged on the shelf accordingly. The result: not only did shoppers find it easier to navigate and interact with the category but the basket size grew by 30% for the category and 40% for the brand, in a mature category.
“Consumers’ sweet spots” and “need-states?” How can one neglect “wheelhouses,” or “AOIs” (areas of interest), or “COCGs” (centers of cognitive gravity)? And doesn’t “SKUs” actually include “line extensions” and “products?”
This discussion reminds me of “Positioning: The Battle for Your Mind,” by Trout & Ries (now in its 20th Anniversary Edition). “Chercher le creneau” (look for the hole–in the mind). Perception Research Services appears to have done an excellent job of reinforcing the theories of Trout & Ries and taking them a step or two further.
Historically, the #1 reason shoppers give for continuing to shop their regular supermarket instead of changing to another is, “I know where everything is.” Whether the mixers are near the booze, in the juice aisle, or with the soft drinks, they know where they are and want them to stay there. We can massage shelf sets all we want, and sort by color, price, or package type. We can sort by type of preservation (frozen, refrigerated, etc.) while also sorting by logic (Cheez Whiz with the crackers). But bottom line, the only folks who are vexed by the lack of a perfect, logical display system are the researchers. Customers are smart, and they’ll remember where things are once they find them. But if you keep moving them around to suit some new, revolutionary system designed to make it easier to find items, customers will be more likely to try that new store down the block.
If you follow the mantra of ECR and its views on a shopper centric approach to category segmentation, ranging and planogram design then ultimately, the merchandising solution for some CPG categories will conflict with current brand led designs. Whether this is the case clearly depends on whether shoppers navigate the category (and view it) in terms of various SKU attributes and their relevance for certain consumption occasions and the associated shopping mission or in terms of brands. In situations where the SKU attributes are the key determinants of the shoppers’ segmentation of the category, then block merchandising by brand can reasonably be deemed to have an adverse influence on range perceptions within a category and may result in reduced conversion rates on the basis of lack of perceived choice. However, block branding can also work positively in terms of simplifying the category presentation–and there is evidence that overly complex choices also adversely influence conversion rates. As such, if brand led merchandising is not employed it is often the case that POP must work harder to highlight the category segmentation that is being delivered since without these mechanics an attribute led planogram may appear jumbled, owing to the close adjacency of many differently packaged SKUs.
Additionally, we are aware that shoppers tend to navigate a store based on visual cues as opposed to reading signage etc., and that many categories have “Beacon” SKUs and brands which tell the shopper they have arrived in a particular part of the store. With this in mind block branding can have a positive effect in terms of aiding the shopper to navigate the store and find appropriate products, and if this is to be foregone in the interests of a more shopper-centric planogram, then suitable alternative navigational mechanisms need to be considered.
Finally, we can’t talk about this subject without recognising the dichotomy between retailer and manufacturer agendas. Clearly block branding favours the manufacturer as it creates a concentrated merchandising area devoted to the manufacturer brand and has the potential to not only generate both heightened brand awareness and category stature but also default purchase in the event of lack of perceived choice. However, the retailer who wants to make the shopper’s experience as logical and easy as possible and reinforce choice perceptions at least in some cases requires a product attribute led approach to category merchandising. Ultimately, the reason why if anything, we see brand led merchandising being inappropriately adopted and not the other way around is that by and large the information on which merchandising decisions are made is provided by the manufacturer as opposed to the retailer (albeit that the retailer has asked the manufacturer to provide it). Such instances constitute a fundamental failing of the category management relationship between retailer and supplier and question the validity of a shopper centric partnership approach to category ranging and merchandising issues.
Manufacturers are doing a good job of understanding their consumers by using tools such as “consumer decision trees” to set shelves at retail. The more they know about consumer shopping habits in a particular category, the better they can position products to have the sea of options make sense to the average shopper. Shoppers usually have a thought process they follow in making purchase decisions.
Merchandising has to be more than setting by the sales numbers. Once the proper mix is defined by the numbers, attention to the consumer’s tendencies must be addressed, whether that’s merchandising by symptom as is done in the cold category, or merchandising companion items like shampoo next to conditioner, or by brand blocks as is done in toothpaste and analgesics.
I also think consumers are sometimes inundated by too many choices. I was recently working on an analgesic set that was organized by brand within symptom…which I thought would be an easy way to shop. Often times, the consumer knows what his/her symptoms are but confused by all the choices they have in the analgesic section. Is Brand “A” a good choice for arthritis or is Brand “B” better? Perhaps a set which delineates the arthritis meds from headache meds is a plus for the consumer.
Al Heller, a perceptive journalist in the CPG industry that I have known and respected for many years, has made a thoughtful and highly insightful observation about brands vs. symptoms and the confusion that is created for busy consumers. I do think that sometimes category captains are conflicted with two separate agendas.
After conducting numerous studies on the match between market structure and shelf set (and numerous papers written on the subject) we have learned a simple fact–there is no necessary connection between setting a shelf to market structure and its sales or ease of shopping. The key word here is necessary–we have seen improvements in sales and ease of shopping in some cases. This raises the question of whether the market structure is correct, whether the shelf obviously and appropriately reflects the market structure, and whether it makes a difference to the consumer–sometimes it just doesn’t matter.
Ms. Lev-Glick’s example for analgesics may be a case of a bad structure–in our work, brand usually comes up first in substitution analyses, and we shouldn’t be surprised by that. Our experience is that when brand loyalty is high, shelf sets don’t matter much–shoppers will find the product where you place it.
Retailers have historically set shelves according to industry defined segments and basic physical product characteristics. Consumers tend to shop in terms of need states, attitudes and product perceptions.
This can clearly lead to a disconnect in terms of category shelf sets versus consumer shopping behavior. Research to understand consumer shopping behavior in the context of the store is crucial to improving category, section, and even store level merchandising techniques.
Like Lily, we have found that research into consumer decision process/trees can reveal insights that suggest alternative store sets and solutions. Often, these can result in significant, and even dramatic increases in sales, profits and consumer satisfaction.
However, it is critical to understand that the research must be applied in the context of other issues such as logistics and retailer profitability. For example, consumers may view fresh, refrigerated and frozen orange juice to be alternatives that should be shelved adjacent. However, the logistics of this for a retailer would be difficult.
Shopper insights today need to go beyond the basics to incorporate the broader issues of need states, shopping trips, format selection, and retailer profitability as well as individual category sets.
Of course, the CPG industry could bring the USP–not promotion–and point of difference to the category location, and speak to both through its packaging, and/or unique category shelf merchandising. But this is only half of the story. CPG has many times tried to bring a more cognitive message for the category and its brands.
The issue remains for the retailer and the category leader to work in a partnership, with input or suggestions from the other brands in the category, to create a better cognitive and visual experience for the shopper.
The retailer is the partner and referee in this activity, as is the consumer and shopper, inputting to this category and proposed experience!
There are supermarkets that have done this with annual consumer/shopper two-way communications and activities with the category leader–note–with the consumer/shopper who may or may not be an ongoing category purchaser.
Nothing new, but seldom initiated. And you must ask, why not? Especially, if it helps category and overall brand sales. Let’s not forget the supermarket opportunity to have a competitive advantage and shopper POD; leading to… More Gross Profit Margin $$$$$$!
A large HHHMMMMMMMMMMMMMMMMMMMMMMMMMMMMMM!
The article has two concurrent themes that are inter-related but have their distinct place in CPG marketing. It starts off with marketing communications and its role in communicating the value proposition and then shifts into the importance of attitudinal drivers of consumer purchase behavior, which is more related to the demand structure. An effective marketing communication plan follows a good understanding of the category demand structure. In the analgesic example used by Ms. Lev-Glick, if consumers relate more to brands than to symptoms (this is probably true for the analgesic category), then a consumer loyal to say Tylenol, looking for something for his/her sinuses, would prefer all Tylenol products grouped together, rather than all sinus products across brands grouped together. But in the meat section, most consumers would probably prefer specific types of meat grouped together than brands. So, while it may be important to understand consumer attitudes while approaching a category, it is important (and obvious) that there may be big differences in these attitudes across categories. Once you understand the attitudes correctly, structuring the marketing communication will follow.
Many shoppers go by item or symptom, not brand. The cereal example Leon cites is a perfect example. All DSD categories suffer this disconnect. Retailers and brands who say they’re customer-driven betray their true principles when they arrange their displays by brand. It’s easier for the suppliers and the retailers to put all Nabisco cookies together, all Coca-Cola products in 1 display, and all Kraft cheeses in the same refrigerator.
The article points out something that has long been an issue: the disconnect between the shopper’s “mind-set” and the shelf-set. Admittedly, different need (and want) occasions exist; yet, the supermarket industry has a long way to go in just applying consumer decision tree structures to the planogram. All too often, manufacturer desires to ensure brand and vendor blocking overtake how consumers actually shop. And, of course, money changes hands over shelf location/allocation decisions. Does anyone really believe that when consumers shop for cereal that their first decision is whether they will buy a Post, Kellogg’s, Quaker, or General Mill’s product? Yet, very few retailers’ cereal schematics reflect a configuration that is other than by vendor. Other examples abound of yet another operational reality that makes consumers less likely to buy food in traditional supermarkets.
Research that we have conducted in the UK shows that on average, shoppers use nearly 7 grocery outlets to satisfy all of their needs. Retailer choice is very much dependent on the shoppers circumstances at the time, however, we also find that a major determinant of retailer choice is location.
I certainly wouldn’t say that category layout is a major factor in driving a shopper’s choice of store, however, competition is intense and the battle between retailers is about maximising their share of the shoppers wallet. With this in mind any tactic that a retailer can adopt which will increase conversion rates in a category by a percentage point or two, or prompt an unplanned impulse purchase can be of significant advantage. So at this level, whilst accepting that shoppers will never tell us directly that category layouts and merchandising have a baring on their behaviour, optimising the merchandising of categories and for that matter, any other aspect of the in-store experience and tailoring it towards desirable shoppers and shopping missions still has a significant role to play in driving sales and share of wallet.
This discussion hits at the heart of my concern over what retailers and their consultants are doing to affect the retail environment. In the list of comments in response to this query, several of you referred to studies you had done that supported or refuted the claims of the original article. Were these truly independent results or results achieved to make a supportive point? I would also agree with the comment about how different approaches for different merchandise categories are needed.
I’m no researcher, only a hands-on designer/merchandiser/brand action observer, who desperately wants to hear some conclusive answers on how the customer can be serviced best, dang the operations staff.
I would ask you all to take a look at the paper I wrote, attached to my profile in RetailWire: Improving the Shopping Experience: Fact or Fiction. The paper asks a lot of questions that many of you probably have an opinion about. I’d like to hear that.
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The article has uncovered a very clear “call to action” for the industry and there are recommendations aplenty that could and should evolve from this insight to reduce confusion at the shelf. The only thing that jumps out at me (having read the original posting in CPGmatters)is the thought that this cannot be seen as a “manufacturer issue” to resolve. If anything, the larger opportunity may be that the retailer will need to recognize the enormous potential of the shelf/department/section to “sell” for itself on their behalf and as a strategic differentiator.
All too often in the industry the assumption of responsibility (or the doling out of blame) tends to run along “us” vs. “them” lines. This is an opportunity for BOTH manufacturers and retailers to reconfigure how they approach the merchandising of products and align in a way that accomplishes their goals much more successfully than is at times done currently.
Working with retailers and manufacturers over the last year on initiatives very similar to this one, the interest and success of efforts have proven to be enormously successful. The next generation of thinking in the industry has arrived and it focuses on what Category Management could not and did not–the experience.
An extremely valid point of view. Shelves, assortments, and planograms are more often than not arranged by ‘how retailers source’ and ‘how brand marketers classify’ categories, rather than by ‘how shoppers shop’ them. In many cases, the obvious is not always the most apparent. Making shelves shopper-centric not only makes it easier and more relevant, but encourages more purchases and increases the size of the basket. A project we recently did for a Biscuits major in India proves this. Historically, the category was stacked based on manufacturer/retailer product groupings- Glucose, Marie, Salted, Cookies, Cream, Digestive etc. On studying how shoppers shop the category, we discovered that they don’t shop by this grouping at all. They shop by ‘occasion/type of use’–tea time, treats, snack, for kids, health, etc. The entire category was rejigged on the shelf accordingly. The result: not only did shoppers find it easier to navigate and interact with the category but the basket size grew by 30% for the category and 40% for the brand, in a mature category.
“Consumers’ sweet spots” and “need-states?” How can one neglect “wheelhouses,” or “AOIs” (areas of interest), or “COCGs” (centers of cognitive gravity)? And doesn’t “SKUs” actually include “line extensions” and “products?”
This discussion reminds me of “Positioning: The Battle for Your Mind,” by Trout & Ries (now in its 20th Anniversary Edition). “Chercher le creneau” (look for the hole–in the mind). Perception Research Services appears to have done an excellent job of reinforcing the theories of Trout & Ries and taking them a step or two further.
Historically, the #1 reason shoppers give for continuing to shop their regular supermarket instead of changing to another is, “I know where everything is.” Whether the mixers are near the booze, in the juice aisle, or with the soft drinks, they know where they are and want them to stay there. We can massage shelf sets all we want, and sort by color, price, or package type. We can sort by type of preservation (frozen, refrigerated, etc.) while also sorting by logic (Cheez Whiz with the crackers). But bottom line, the only folks who are vexed by the lack of a perfect, logical display system are the researchers. Customers are smart, and they’ll remember where things are once they find them. But if you keep moving them around to suit some new, revolutionary system designed to make it easier to find items, customers will be more likely to try that new store down the block.
If you follow the mantra of ECR and its views on a shopper centric approach to category segmentation, ranging and planogram design then ultimately, the merchandising solution for some CPG categories will conflict with current brand led designs. Whether this is the case clearly depends on whether shoppers navigate the category (and view it) in terms of various SKU attributes and their relevance for certain consumption occasions and the associated shopping mission or in terms of brands. In situations where the SKU attributes are the key determinants of the shoppers’ segmentation of the category, then block merchandising by brand can reasonably be deemed to have an adverse influence on range perceptions within a category and may result in reduced conversion rates on the basis of lack of perceived choice. However, block branding can also work positively in terms of simplifying the category presentation–and there is evidence that overly complex choices also adversely influence conversion rates. As such, if brand led merchandising is not employed it is often the case that POP must work harder to highlight the category segmentation that is being delivered since without these mechanics an attribute led planogram may appear jumbled, owing to the close adjacency of many differently packaged SKUs.
Additionally, we are aware that shoppers tend to navigate a store based on visual cues as opposed to reading signage etc., and that many categories have “Beacon” SKUs and brands which tell the shopper they have arrived in a particular part of the store. With this in mind block branding can have a positive effect in terms of aiding the shopper to navigate the store and find appropriate products, and if this is to be foregone in the interests of a more shopper-centric planogram, then suitable alternative navigational mechanisms need to be considered.
Finally, we can’t talk about this subject without recognising the dichotomy between retailer and manufacturer agendas. Clearly block branding favours the manufacturer as it creates a concentrated merchandising area devoted to the manufacturer brand and has the potential to not only generate both heightened brand awareness and category stature but also default purchase in the event of lack of perceived choice. However, the retailer who wants to make the shopper’s experience as logical and easy as possible and reinforce choice perceptions at least in some cases requires a product attribute led approach to category merchandising. Ultimately, the reason why if anything, we see brand led merchandising being inappropriately adopted and not the other way around is that by and large the information on which merchandising decisions are made is provided by the manufacturer as opposed to the retailer (albeit that the retailer has asked the manufacturer to provide it). Such instances constitute a fundamental failing of the category management relationship between retailer and supplier and question the validity of a shopper centric partnership approach to category ranging and merchandising issues.
Manufacturers are doing a good job of understanding their consumers by using tools such as “consumer decision trees” to set shelves at retail. The more they know about consumer shopping habits in a particular category, the better they can position products to have the sea of options make sense to the average shopper. Shoppers usually have a thought process they follow in making purchase decisions.
Merchandising has to be more than setting by the sales numbers. Once the proper mix is defined by the numbers, attention to the consumer’s tendencies must be addressed, whether that’s merchandising by symptom as is done in the cold category, or merchandising companion items like shampoo next to conditioner, or by brand blocks as is done in toothpaste and analgesics.
I also think consumers are sometimes inundated by too many choices. I was recently working on an analgesic set that was organized by brand within symptom…which I thought would be an easy way to shop. Often times, the consumer knows what his/her symptoms are but confused by all the choices they have in the analgesic section. Is Brand “A” a good choice for arthritis or is Brand “B” better? Perhaps a set which delineates the arthritis meds from headache meds is a plus for the consumer.
Al Heller, a perceptive journalist in the CPG industry that I have known and respected for many years, has made a thoughtful and highly insightful observation about brands vs. symptoms and the confusion that is created for busy consumers. I do think that sometimes category captains are conflicted with two separate agendas.
After conducting numerous studies on the match between market structure and shelf set (and numerous papers written on the subject) we have learned a simple fact–there is no necessary connection between setting a shelf to market structure and its sales or ease of shopping. The key word here is necessary–we have seen improvements in sales and ease of shopping in some cases. This raises the question of whether the market structure is correct, whether the shelf obviously and appropriately reflects the market structure, and whether it makes a difference to the consumer–sometimes it just doesn’t matter.
Ms. Lev-Glick’s example for analgesics may be a case of a bad structure–in our work, brand usually comes up first in substitution analyses, and we shouldn’t be surprised by that. Our experience is that when brand loyalty is high, shelf sets don’t matter much–shoppers will find the product where you place it.
Retailers have historically set shelves according to industry defined segments and basic physical product characteristics. Consumers tend to shop in terms of need states, attitudes and product perceptions.
This can clearly lead to a disconnect in terms of category shelf sets versus consumer shopping behavior. Research to understand consumer shopping behavior in the context of the store is crucial to improving category, section, and even store level merchandising techniques.
Like Lily, we have found that research into consumer decision process/trees can reveal insights that suggest alternative store sets and solutions. Often, these can result in significant, and even dramatic increases in sales, profits and consumer satisfaction.
However, it is critical to understand that the research must be applied in the context of other issues such as logistics and retailer profitability. For example, consumers may view fresh, refrigerated and frozen orange juice to be alternatives that should be shelved adjacent. However, the logistics of this for a retailer would be difficult.
Shopper insights today need to go beyond the basics to incorporate the broader issues of need states, shopping trips, format selection, and retailer profitability as well as individual category sets.
Of course, the CPG industry could bring the USP–not promotion–and point of difference to the category location, and speak to both through its packaging, and/or unique category shelf merchandising. But this is only half of the story. CPG has many times tried to bring a more cognitive message for the category and its brands.
The issue remains for the retailer and the category leader to work in a partnership, with input or suggestions from the other brands in the category, to create a better cognitive and visual experience for the shopper.
The retailer is the partner and referee in this activity, as is the consumer and shopper, inputting to this category and proposed experience!
There are supermarkets that have done this with annual consumer/shopper two-way communications and activities with the category leader–note–with the consumer/shopper who may or may not be an ongoing category purchaser.
Nothing new, but seldom initiated. And you must ask, why not? Especially, if it helps category and overall brand sales. Let’s not forget the supermarket opportunity to have a competitive advantage and shopper POD; leading to… More Gross Profit Margin $$$$$$!
A large HHHMMMMMMMMMMMMMMMMMMMMMMMMMMMMMM!
The article has two concurrent themes that are inter-related but have their distinct place in CPG marketing. It starts off with marketing communications and its role in communicating the value proposition and then shifts into the importance of attitudinal drivers of consumer purchase behavior, which is more related to the demand structure. An effective marketing communication plan follows a good understanding of the category demand structure. In the analgesic example used by Ms. Lev-Glick, if consumers relate more to brands than to symptoms (this is probably true for the analgesic category), then a consumer loyal to say Tylenol, looking for something for his/her sinuses, would prefer all Tylenol products grouped together, rather than all sinus products across brands grouped together. But in the meat section, most consumers would probably prefer specific types of meat grouped together than brands. So, while it may be important to understand consumer attitudes while approaching a category, it is important (and obvious) that there may be big differences in these attitudes across categories. Once you understand the attitudes correctly, structuring the marketing communication will follow.
Many shoppers go by item or symptom, not brand. The cereal example Leon cites is a perfect example. All DSD categories suffer this disconnect. Retailers and brands who say they’re customer-driven betray their true principles when they arrange their displays by brand. It’s easier for the suppliers and the retailers to put all Nabisco cookies together, all Coca-Cola products in 1 display, and all Kraft cheeses in the same refrigerator.
The article points out something that has long been an issue: the disconnect between the shopper’s “mind-set” and the shelf-set. Admittedly, different need (and want) occasions exist; yet, the supermarket industry has a long way to go in just applying consumer decision tree structures to the planogram. All too often, manufacturer desires to ensure brand and vendor blocking overtake how consumers actually shop. And, of course, money changes hands over shelf location/allocation decisions. Does anyone really believe that when consumers shop for cereal that their first decision is whether they will buy a Post, Kellogg’s, Quaker, or General Mill’s product? Yet, very few retailers’ cereal schematics reflect a configuration that is other than by vendor. Other examples abound of yet another operational reality that makes consumers less likely to buy food in traditional supermarkets.
Research that we have conducted in the UK shows that on average, shoppers use nearly 7 grocery outlets to satisfy all of their needs. Retailer choice is very much dependent on the shoppers circumstances at the time, however, we also find that a major determinant of retailer choice is location.
I certainly wouldn’t say that category layout is a major factor in driving a shopper’s choice of store, however, competition is intense and the battle between retailers is about maximising their share of the shoppers wallet. With this in mind any tactic that a retailer can adopt which will increase conversion rates in a category by a percentage point or two, or prompt an unplanned impulse purchase can be of significant advantage. So at this level, whilst accepting that shoppers will never tell us directly that category layouts and merchandising have a baring on their behaviour, optimising the merchandising of categories and for that matter, any other aspect of the in-store experience and tailoring it towards desirable shoppers and shopping missions still has a significant role to play in driving sales and share of wallet.
This discussion hits at the heart of my concern over what retailers and their consultants are doing to affect the retail environment. In the list of comments in response to this query, several of you referred to studies you had done that supported or refuted the claims of the original article. Were these truly independent results or results achieved to make a supportive point? I would also agree with the comment about how different approaches for different merchandise categories are needed.
I’m no researcher, only a hands-on designer/merchandiser/brand action observer, who desperately wants to hear some conclusive answers on how the customer can be serviced best, dang the operations staff.
I would ask you all to take a look at the paper I wrote, attached to my profile in RetailWire: Improving the Shopping Experience: Fact or Fiction. The paper asks a lot of questions that many of you probably have an opinion about. I’d like to hear that.