The product placement in a retail store has a major influence on the sales of the store. This is because it matters in the decision of a customer to buy a product. Typically, products in the retail stores have a limited life. Hence, the success of these products, especially the fast moving consumer goods, depends on how fast they get sold in the market. Product placement is the strategy of how the products in a super market or a retail outlet are placed in the shelf, so that they get sold out fast. This is optimised to the limitation of the limited shelf area. Putting the products in an appropriate manner have a direct impact on the revenue of a retail store.
With hundreds of brands competing in the sales, the seeking of attention and consumer’s time is the key for sales. This is where the product placement comes in the play.
Planograms
Planograms are the schematic plan of a store which tells where to place the products so as to maximize the sales.
Planograms help stores in maximizing the space utilization and revenue. It is like a store on paper which tells what products are to placed where. What products would be at the eye level? What products woud be at the bottom? What products would be at the start of the store? What products would be at the end of the store? These are some questions answered by it. We, as consumers, are mostly unaware of the layout of the store. But a detailed analysis is done behind the placement of it.
What product placement strategies do retailers use?
Essential products at the end and non-essential products at the start
Frequently required items like groceries and milk are placed by stores at the end. Opposite to this, the non essential, luxury items like perfumes are placed at the start. It is of most probability that consumers would have come to buy the essentials in the store. This leads them to go at the end of the store, and on the way are the usually high margin luxury items. This can motivate the consumer to buy these products. And not to forget, the consumer walks through the luxury items twice while going in and out of the store. This constant bombarding of the luxury products encourages the customer.
Complimentary products
Have you ever seen soaps and soap cases placed side by side? Placing complimentary products on sides motivates the consumers to buy them together. This makes sense as both the products provide a complete value to the consumer.
Eye level products
How many times in a retail store have you picked up a product which is at the bottom of the shelf? If you have a clear intention of purchasing a specific one, then only you might have done it.
Studies suggest that the majority of the products in a retail store are sold which are at the eye level. Hence retail stores ensure that the best and most successful products are kept at the eye level in the shelf.
How technology is helping in the product placement?
In the era of digitalization, technology is playing an important role in the retail decision making. Modern data driven solutions are helping the retailers to decide where to keep their products in their stores.
The data collected from various methods like images, videos, and, RFID tags are now used by retailers to decide the optimum product placements. This process, like any digitalization project, has multiple phases – installation, data collection, data analysis, and changes with the feedbacks. It is a continuous process towards gradual optimization and maximizing the revenue.
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