First and foremost, cross-merchandising is about making the shopping experience more convenient by grouping complementary products from different categories together.
What is cross-merchandising?
Cross-merchandising is the practice of displaying products from complimentary categories together, enticing customers to buy more by offering them interconnected product solutions. Cross-merchandising is a powerful strategy for driving sales while satisfying consumer needs and should be used throughout your stores.
- Products from different categories are displayed together at one place.
- Informing the customer of the various options available, that could complement their product.
- Improving the consumer’s shopping experience and saving them time.
Nine examples of cross-merchandising in action
Here are nine examples of cross-merchandising which offer shoppers solutions and better in-store experiences:
1. Display combinations which tap into shopper missions
According to The Telegraph, “when beer and snacks come together, good things happen.” Liquor shops take full advantage of this knowledge by strategically placing these two products together, ensuring their beer displays are always featured alongside a selection of salty finger snacks, like chips, peanuts, and biltong.
Another example might be the pre-packaged lettuce, tomatoes, cucumber, and celery displayed together to help customers gather everything they need for a quick salad.
When you know your customer missions, you’re able to create cross-merchandising displays which cater accordingly. And when shoppers can relate to the display, they're more likely to purchase.
2. A combination of field marketing and cross-merchandising
West Point Market in Ohio demonstrated how to use their grill machine by preparing hot grilled sandwiches while handing out samples to customers. As customers tasted the samples they not only bought the grill machine but everything they needed to make their own melted cheese sandwiches at home.
3. The unexpected buyer persona cross-merchandising opportunity
Some years ago, Tesco stores in the UK realised that a large proportion of people buying nappies were men. After some research, it was revealed that the wives had sent their husbands to the shops to replenish the nappy supplies, while they were home caring for the baby.
When Tesco became aware of this shopping phenomenon, they started to display beer and snacks alongside the nappies and immediately experienced an increase in sales. This beer and nappy combo is proof that when you carefully review sales data, research and customer personas you might spot an unusually lucrative cross-merchandising opportunity.
4. Make the shopper's life easier
Buehler's Fresh Foods in the US sold cherry pitters (a device for removing the pit from a cherry) with bags of cherries. They made a killing and sold out the cherry pitters at all 15 chain stores. The cherry pitter had always been available in the store, but shoppers never paid it any attention, until the use case was conveniently highlighted.
This cherry pitter example highlights the importance of a retailer's role in making life a little easier for the shopper.
5. Save the shopper time
Traditionally, ice cream and ice cream scoops were displayed at different store aisles. Customers who buy ice cream appreciate it when a retailer saves them time by displaying the scoops alongside the ice cream so that they can get both products at once. The convenience keeps customers coming back.
Some other cross-merchandising ideas that save time might include displaying ice cream toppings (glazed cherries and chocolate sprinkles), normally found in the sweet or baking aisle, close to the ice cream scoops; this will also trigger impulse buying behaviour.
6. Associate your merchandise with a memorable experience
Smart retailers understand the value of memorable experiences. By associating your products with a positive experience as opposed to singular products, you can stimulate favourable buying responses.
For example, families often enjoy picnics, they indulge in food, play games and generally have a good time. As a retailer you can offer an experiential solution for this by displaying associated picnic products together.
7. Remind the shopper of their needs
Shoppers often forget the little things. They might remember to buy salad greens but forget that they've run out salad dressing.
Retailers should capitalise on this and assist customers with completing their forgotten shopping list. By cross-merchandising smartly, you can remind shoppers of the little things.
An example of this is displaying salad dressings and condiments next to the salad ingredients in the produce section or displaying soy sauce next to the curry pastes and stir-fry noodles.
8. Show customers how to use the product
Sriracha sauce. Some shoppers love it; some might like to try it (and would probably love it) but have no idea how to use it in their cooking. Such an unknown product, like Sriracha sauce, is an opportunity for you to cross merchandise by displaying it alongside products which are meant to accompany or complement it, while displaying simple recipe ideas, to prompt the shopper to buy the sauce and try it at home.
9. Group products together for a specific occasion
Make sure your specials or promotions don't go unnoticed by using cross-merchandising that highlight special occasions.
Supermarkets frequently display products together to encapsulate the back-to-school theme, like lunch boxes with an assortment of snacks.
Save Smart promoted avocado sales by adding complimentary items such as chips, taco shells, and beverages during the football season.
Five tips for successful cross-merchandising
- Understand your customers: Consider the display from the customer's point of view. If it doesn't make sense or doesn't appeal to their needs, the grouped items will not sell effectively.
- Create your product display around a central theme: Cross-merchandising should not clutter the store or the aisle. Your merchandise should be visible to shoppers and should tie in with the rest of the store's marketing and promotional material.
- The products must have a logical link or connection: For cross-merchandising to work, you must group products which are related in some way. For example, don't display strawberries and pasta sauce together, there’s no logical link there. Your customers won't understand the intention behind the pairing. Make it easy for your shopper to make the association, for example, strawberries, fresh cream, and attractive dessert bowls would be a far better display.
- Track performance: The products you've displayed together should have seen an improvement in sales but if sales stay the same or decline, you should reconsider your cross-merchandising strategy.
- Limited yourself: In order for cross-merchandising to work, it needs to be in focused areas, possibly even seasonally based or, based on performance as mentioned above. A store which employs cross-merchandising in every aisle may become adversely extremely confusing for a shopper.
Cross-merchandising works best when it adds value and convenience to the shopping experience. Where to start? Planning is the key to a stellar cross-merchandising strategy so start by planning your shelf management.