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5 Biggest Product Layout Blunders (And How to Avoid Them)

Darren Gilbert
by Darren Gilbert on Mar 12, 2018 2:55:11 PM

Product Layout.png

A correct product layout goes a long way to helping your stores become a success. In fact, it’s crucial. After all, it can mean the difference between a happy and stress-free shopper, or one that is both angry and disappointed.

That said, work in retail long enough, and you’re bound to make a few mistakes in the layout of your products. There should be no shame in admitting that. As long as you fix these blunders as soon as you are you are aware of them, there shouldn’t be a problem.

The challenge comes in when you notice a problem, like one or more of those we list below and, do nothing about them.

1. Not grouping your products by category, sub-category or segment

Correct product hierarchies and proper classifications are crucial for your retail business.. In fact, it’s one of the key questions that you need to ask yourself when setting up the flow of your products in-store.

That’s because of the purpose of grouping products together. In short, it gives your shoppers an idea of how they are meant to shop for products in your store. More than that, they need to be grouped in a way that makes rational sense to your customers so that it becomes easier to shop your stores.

Let’s take a simple category such as Baby Foods to illustrate our point. If you stock them in your stores, you’ll know that in this category, along with other sub-categories, you’d have Baby Formula, Baby Cereal and Pre-made Jars for example. You can dive even deeper to look at the different segments or sub-segments of each of these sub-categories.

If you don’t group similar products, what could end up happening is you’d have strawberry-flavoured baby cereal next to baby pacifiers with your other cereal flavours in a different part of the aisle. That makes for an illogical flow, and it makes it difficult for your customers to compare like with like.

2. Not merchandising your products from small to large on shelf

The human brain has been trained to perceive the world in a particular manner. We’ve been taught to read left to right and count one to ten, for example. This natural perception of our environment also makes us think in terms of smallest to largest.

To cater for that perception, it's best practice to merchandise your products from small to large.

Of course, it won’t destroy your store or damage your reputation if you do it the other way around. In fact, if you work with some suppliers or buyers, you might find yourself merchandising products from biggest to smallest. That said, a read of the various merchandising principles indicate its best to go from small to large.

For one, merchandising products smallest to biggest ensures that your customers are lead through your category. It’s also visually appealing to your customers and ensures that your shelves appear neater and organised.

On the other hand, you can do it to upsell your customers. Let’s take the example of the Shampoo category. A 250ml bottle might cost R42.95. Just next to that you might place a 400ml shampoo bottle and price it at R59.85. Your customers will see the two prices, note that the difference isn’t all that big and could decide to trade up.

By not ensuring your stores follow this product layout best practice, you’re effectively missing out on the opportunity to increase your profitability.

3. Not positioning your house brands next to market leaders

We’ve written about house brands and given tips for any retailer looking to grow their store brand. That’s over and above the other piece which focuses on the reasons why you should consider introducing a house brand.

That said, holding stocks is one thing. You also need to place them in the correct position on the shelf. Since your house brand is meant to convey your business, you want your customers to know and recognise your brand. To do this you’d want to place it next to the market leader of the specific category.

Besides that, there are a few other reasons why you should position your house brands there.

For one, it’s to show that there is another product that is of the same or similar quality as the leader which costs less. The fact that there is another option that could satisfy your customer’s needs can lead them to make the purchase, even if it’s out of curiosity. Since you’d be likely to make more margin out of your house brand, you should try to do everything you can to push these products.

By not positioning your house brand next to the market leader in your product layout, it could quite easily get lost. That’s especially true if you consider that your customers shop by brand and so are unlikely, in most instances, to come into your store looking specifically for your own private label.

4. Not following space to sales, using Days of Supply

Your shelf space is a commodity in your retail stores, and with any commodity, there is a demand. You only need to ask any supplier how they fight for space in a store if you want proof. The last thing you’d want to do is give it away or waste it unnecessarily.

That said, the problem of not following space to sales, using your days of supply, is that you will soon find yourself misallocating space, which results in a mess for your stores and little satisfaction for your shoppers.

Then there is the ripple effect.

On the one hand, it will affect how much stock you order and place on the shelf. You might even order the wrong amount of stock, which can lead to over and under stocking your stores. Dead stock is also a possibility. On the other hand, it can mean your merchandisers - the unsung heroes in retail - end up packing your shelves more often than they should.

Read about the value of Days of Supply with our infographic.

5. You don’t place your best product at eye-level

As the saying goes, eye-level is buy level. That becomes that much more important when you consider that your customers buy with their eyes first.

Then there is the fact that by placing your an established and well-known product at eye-level, your customers recognise which category they’re currently shopping. Let’s take the example of Heinz Tomato Sauce. It’s one of the world’s most recognisable brands. By placing it at eye-level, when your shopper sees it, they know they are most likely in the Sauce aisle or section.

It might even jog their memory to buy mustard or another sauce that they might not have thought of before.

Placing your best product at eye-level is also essential because those are the products that your customers see first and what they see can lead them to form a specific opinion on your stores and retail brand.

For example, if they walk into your store, which happens to be a high-end watch store and the first thing they see is a cheap knock-off brand, what does that say about the rest of your store?

How to avoid these product layout blunders

Regardless of if you want to avoid these product flow errors or fix them, it all comes down to one thing: a planogram. More specifically, a planogram that is data-driven.

The reason for that is simple: a data-driven planogram is the only way to remove all the guesswork around how to lay out your shelves. When you have the correct data, you’ll know which brand or product contributed from most to least profit. In turn, you’re better placed to appoint space apportion and allocation. Due to the data behind it, it’ll be correct.

More than that, it will take away any frustration that comes from not knowing where to begin, and deliver a result that takes everything into account. In turn, your customer will be happier as there is a logical layout that makes sense to them.

Conclusion

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