Shopper-centred merchandising

A large part of shopper decisions is made in-store, so how shelves are arranged and whether goods are in stock are very important: it is merchandising that decides what ends up in shoppers’ baskets. Originally the role of merchandising was to ensure constant on-shelf and in-store product presence; later came promotional and secondary displaying based on a planogram. Finally it also became merchandisers’ task to manage POS tools – explained Enikő Pusztai, the key account manager of P.O.P. Hungary Zrt. Ágnes Csiby, the client service director of In-store Team Kft. and president of POPAI Hungary Association, added that the main goal is always to improve sales – but often retailers want to do this in the whole category, while manufacturers only want to see their own brand thrive. Renáta Draskovich, electro division trade marketing manager of Orbico Hungary Kft. told that the fundamental principles of merchandising, personalised for various categories and constantly updated, are the ‘Bible’ of merchandising, used daily by sales reps. Gábor Viczián, P&G division sales manager of Orbico Hungary Kft. revealed that it is in the interest of every party if in addition to trends and the national average, there are local and chain-specific fundamental merchandising principles too. What makes a good planogram? Ms Pusztai is of the opinion that the people involved have to be aware of daily changes and current trends. Everything has to be there: the product, the retail chain’s permission, a good merchandiser team, enough time and a professional reporting system. Ms Csiby reckons that the shelf needs to be full. The colour red is best to be used for highlighting promotions. Massive secondary displaying is also important and the emphasis must be on communicating the product. A 2014 POPAI study found that shoppers tend to notice the product only. Mr Viczián mentioned collaboration in planning, trust and expertise. A good project manager is also key, someone who is accepted by all parties. A superb Field Sales Force team is necessary too, with all the knowledge needed for creating the best planogram in a category. A dedicated store management is also a prerequisite of successful projects. Ms Draskovich explained that representing the electrical beauty products of brands such as Braun or Oral-B means they have to do everything to help shoppers select the right product at the point of selling: consumers enter the category only every 5-7 years and they only spend 2 weeks with gathering information. They make their shopping decision after spending 5-20 minutes in front of the shelves. There is lots of debate going on about how long a planogram works and how changes should be managed or new products should be introduced. Some use the same planogram for six months, while others change it in every season. With secondary displaying the planogram tends to change monthly or even more frequently. In planning and preparation work manufacturers and wholesalers have the most things to do. When everything is ready, merchandisers can start then implementation, in cooperation with retail chains. Professional online informatics systems can greatly contribute to project efficiency. When new products are introduced to the market, the main objective is to establish the distribution as rapidly as possible. Today when the internet is everywhere, the e-commerce channel is also important in merchandising. On the one hand, this channel is a virtual shelf, and on the other hand, it is a platform where information is provided. All in all, planograms’ performance can be measured by how many products are sold for how much money in a given period of time. Ms Pusztai told our magazine that in 2012 they launched their own Android-based reporting system. The information flow between smartphone-owning merchandisers and the company headquarters speeded up, opening up new horizons. Ms Csiby agrees that cooperation, control and coordination can be made more efficient by using modern technology, adding that the human factor is just as important. Mr Viczián stressed the importance of simple planning and implementation. Merchandising must rely on the basic rules and precise calculations. From future trends 3D and 4D tools and interactive solutions are important. Ms Draskovich also talked to us about innovative projects in the future, mentioning the Middle East and Asia as good examples. Her company sees the future in the combination of online and offline realisations. Omnichannel solutions turn shopping into an experience, establishing a connection between the place of selling, the brand and the shopper. n