Once the inventory comes inside a retail store, the next big thing which comes inside the mind of a retailer is to decide where to put it and how much area should be allocated to the specific product. The decision of where in the store the products will sit is very important step in retail since store layouts are crucial to the shopping experience. Products need to be easy to locate, be near related products, and have the correct facings. Space management is about maximizing every inch of the selling floor.
Accounting the derivatives of store designing, Jagdeep Kapoor, chairman and managing director, Samsika Marketing Consultants Pvt. Ltd. mentions, “Navigation and access and ease of browsing and picking up determine the store design.”
Chandru Kalro, executive VP-marketing, TTK Prestige Ltd, says, “Our stores are designed in such a way that the customer can have a non-obtrusive shopping experience. But in value formats, catering to masses, it is packing as much merchandise as possible with not much emphasis on having it very organized. In formats catering to high end customers, stores are designed to make the shopping experience great and there is a ‘stunner’ factor in the store.”
Location & space
A literal meaning of sales display is - arranging systematically saleable goods so as to attract the attention of the customer. In retail industry, product visibility of any brand is necessary to promote sales. Many a times, space is often limited and merchandise to be displayed is more, so one needs to really manage the space well - herein comes shelf management. Kalro says, “Shelf management plays an important role in managing merchandise well and helps to focus on categories or products that retailer intends to promote.
When asked how do retailers decide what to put and where on shelf, Kalro said, “Buyers do not always come to the store with a preset list in their minds about the products they want to buy. We plan our shelf to ensure all products in our range are well displayed as lot of the purchase is impulsive. Also while planning our shelf we see to it that there is optimum utilization of space and maximum amount of merchandise can be displayed.”
Visibility & sales promotion
According to Kalro, product visibility plays a major part in customers' buying decisions - ‘One buys what one sees’, therefore, product visibility is very important. It is a function of persistence, precision and repetition - Your message needs to be heard repeatedly to rise above the background noise of daily business. Organized retail business in India is still competing to spread its foothold in India. The modern retailers are trying to increase the consumption – to create an urge for purchase; make people buy even if there is no great urgency to purchase. Supporting the fact, Kapoor, says, “Product visibility is what leads to impulse purchase inside your store. Product must be neatly stacked and visible face up.”
Many brands and retailers try to engage the customer at the point of sale. Product promotion inside the store is very important to make consumers aware of sales promotion schemes as advertising in mass media is expensive and deliveries are not 100 percent. Today brands and retailers are cutting down on expenditure in mass media and focusing on the customer contact point. This is going to become more pronounced as the modern retail grows in India.
Competition among brands
The next lesson of shelf management is managing competition among different competitor brands. While providing answer on how a brand survives in front of another brand having an ongoing offer inside the store. Kalro says that “even if there is no offer on a brand and it is there on another brand we try to do justice to both .If the brand has an ongoing offer – the offer is highlighted, but if another brand has no offer on it –its product features are highlighted to highlight its presence inside the store. Though, at TTK Prestige, we have only single brand stores, there is competition amongst sub brands within categories. But we try and do justice to all sub brands or categories.”
Kapoor also believes that consumers have their own preferences. He says, “Some people have preferences for brands, on the other hand some have preferences for schemes and deals. Therefore all the brands inside the store thrive depending on the consumer preferences. Both need to be given equal importance.”
So does that mean the brand featuring an ongoing offer have its negative impact on brand without offer? As per Kalro, offers are not the end of it all. Customers are ready to buy brands for the benefit and value proposition. There are many brands that have no offers at all and yet they sell.”
Agreed with the Kalro point, Kapoor says, “I also believe that offer doesn’t affect sales too much. In fact the brand with the offer can have a negative impact on the consumer giving a signal that is slow moving and hence the need for an offer.”