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How Retailers Get Order from Chaos: Planograms

Post from Core77

Consider how broad industrial design is as a field: Maybe you designed the product that sits on a store shelf. Maybe you designed the box that the product sits in. Or heck, maybe you designed the actual shelves.

If you’ve done any of these things for a major retail client, you’re probably familiar with what are called plan-o-grams, or POGs, or visual merchandising, or “shelf schematics,” or whatever fancy jargon your client used for it. Plan-o-grams are that often un-fun but necessary breed of design work handed down by marketing gnomes, who emerge from their caves with The Data, sacred market-researched algorithms on “shelf presence.” It’s essentially a diagram of what object needs to go where in a retail display, with the ultimate goal of drawing customers into the store, increasing sales and “reinforcing brand.” This eye-grabbing grid can be seen through the window and will draw the customer inside. Put this sparkly gewgaw at eye level so the consumer will spot it. Place these floor-demo items and waist level so the consumer will want to pick them up and touch them. Splash it with the company colors.

Back when I was on active duty, we designers had little to zero input on where individual items went, but were the ones tasked with graphically laying the diagrams out for printouts that were later given to the frontline retail employees. Sometimes late at night if you walk past, say, a closed Banana Republic or a Modell’s, through the window you can see staffers setting up new displays and consulting binders filled with the latest diagrams.RBM_technologies_planogram_merchandising

These days there are specific software programs for marketers to lay out plan-o-grams on their own, and depending on what the product is a less-enlightened company might cut designers out of the process altogether.

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3 Ways for Field Teams to Optimize Merchandising Audits

Merchandising audits provide regular checkups on retailers to ensure stores are carrying out merchandising objectives as directed by headquarters. In a article by business2community.com, gives field teams recommendations on items to look our for while they are on the field:

See the tips below from the article:

1. Taking Stock

Numerous studies show that out-of-stock (OOS) instances and product voids bring down sales and hurt brand image. Some businesses have reported an administrative overhead cost of $800 a week due to OOS instances. From the moment a rep begins confusingly looking for missing product to the moment a back-office manager puts the phone down after an angry conversation with a retailer, precious time is being wasted.

So how do you lower the chances of out-of-stock instances and refocus that time on sales? Field Activity Management software tools offer back-office managers a solution: customized forms. Field reps can easily pull up forms on their mobile phone that will require them to input the current amount of in-store and backup stock. This allows managers visibility across all their territories, so they can identify recurring problems and prevent them before they happen again. Additionally, since the forms can be tailored to each location, reps will always know exactly what products are meant to be in each store.

2. Location Scouting

The location of your product on the shelf is important to consider during a merchandising audit. While eye-level placement has proven to be effective, a deeper look into competitor placement could be a huge advantage for your business. This is especially important to the beverage industry, where 42% of producers said product placement data was one of their core areas of analysis. Your reps should first ensure that the retailer has placed your product at the agreed location. In addition, they should gather information about competing brands’ placements.

The geo-tagged photo feature offered by many Field Activity Management software tools will allow managers to see exactly what their field teams are seeing in the store. With the customized forms, reps will also be able to offer managers cold hard numbers on how much stock competitors have at each location. This kind of visibility is invaluable to emerging small and medium sized businesses.

3. Promotion Checkups

One way for new businesses to gain a customer base is through special promotions and sales. This could be anything from a “buy 1, get one 1 free” strategy to bulk discounts. The effective use of these promotions is directly correlated to higher sales. If your business is paying extra for promotional materials like banners, floor stickers, or cardboard cutouts, it is crucial that they are seen by the customer. If your retailer agreed to these requests and is not living up to them, it may be time for a renegotiation.

The sales analysis function of Field Activity Management software tools empowers back-office managers to do a number of things. First, they can see the disparity of well-merchandised locations against poorly merchandised locations. Second, they can use this data as a strong incentive for retailers to live up to their agreements. Third, the overall reporting on promotions will allow managers to see what campaigns are performing well and which are not.

The Importance of Focus

By leveraging Field Activity Management software, field teams can turn their focus to core business areas like stock checks, product placement, and retailer agreement.  Rather than blindly sending reps to “check things out” around retail locations, make sure their merchandising audits are thorough and that they produce value. Following these steps will place your business one step ahead of competitors.

Finally, there are Visual Merchandising Tools to ensure in-store compliance of products and POP. These Visual Merchandising Tools can be used by store staff to view updated planograms and communicate compliance back to headquarters through photo compliance. These tools provide an increase sales and reduce costs.

In_store_merchandising_zombies

New Research Tackles Known Problem Management in Retail Visual Merchandising and In-Store Campaign Execution

In its newest custom research report, RIS News examines the state of Known Problem Management (KPM) in retail today and what companies can do to create more customer-centric campaigns that are planned and executed on time

Linking ineffective in-store merchandising to a zombie, a problem that refuses to die until someone figures out how to kill it, RIS News examines known problems through the lens of task management and corporate communication at the store level. The problems of these zombies are so bad they are eating up retail profits! And their #1 enabler, according to retailers? The use of email and spreadsheets to manage in-store execution of visual merchandising, planogram management, retail labor operations, merchandising, and customer engagement strategies. Found in the research, retailers are driven most by the need to adapt and respond to the demands of the consumer. In fact, nearly 60 percent of retailers listed it as the top factor causing them to change their approach to executing merchandising plans for promotional events. The pressure to keep up has caused an influx of these zombies.

Other findings from the RIS News research include:

  • Sixty two percent of retailers say the leading cause of ineffective merchandising for promotional events is the limitation caused by using email and Excel spreadsheets
  • More than half of retailers’ merchandising campaign materials are inaccurately planned and distributed
  • Fifty-three percent believe the number one factor preventing stores from executing campaigns on time and accurately is a heavy store workload. Tied for second at 50 percent each are the lack of ability to track stores and inadequate corporate communication

In_store_merchandising_zombies

“The new research from RIS News demonstrates that retailers are beginning to identify known problems and are looking for solutions to kill these zombies,” said Dan Wittner, EVP & Chief Operating Officer at RBM Technologies. “Leading this charge is the desire to create a better in-store experience for the consumer. This is achieved through marked proficiency in executing merchandising plans and staying compliant with corporate campaigns. Fortunately, new technology now empowers store managers to get rid of Excel sheets and excess emails, and focus on the store floor by automating campaign compliance and increasing communication with corporate headquarters through visual planograms.”

Access to the full research report can be downloaded from RIS News.

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63% of retailers to increase IT spending in 2012

Survey results released Wednesday by CompTIA, the non-profit association for the IT industry, found that innovations in information technology continue to transform the retail sector, with digital signage, payment processing, customer engagement and other solutions playing increasingly important functions.

Seventy-two percent of retailers surveyed rate technology as important to their business, CompTIA’s Retail Sector Technology Adoption Trends Study revealed. That figure projects to increase to 83% by 2014.

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Sixty-three percent of retailers expect to increase IT spending in 2012. Large retailers expect to boost IT spending the most – 4.8%. For all firms, the planned increase is 4.2%.

One in three retailers currently uses digital signage, with an additional 20% intending to do so soon. Sales and promotional announcements and other direct engagement with customers are the most popular uses, cited by 71% of respondents.

Among all emerging technologies, adoption intent ranks highest for geo-location services. About one in five retailers now use geo-location technologies and other location-based solutions to reach customers.

“One reason for the strong interest may be in response to ‘showrooming’, where consumers visit a physical shop to assess a product but make the purchase from an online retailer to get the lowest possible price,” said Tim Herbert, VP research CompTIA. “Location-based technologies can give retailers the tools to incentivize in-store purchases, such as special discounts for in-store customers who check-in via an app.”

Retailers are experimenting with technologies that improve upon point of sale systems or leapfrog those systems entirely and leverage new platforms for payment processing. In the CompTIA study, 13% of retailers are currently using a mobile payment system. Another 19% plan to do so over the next 12 months.

[via Chain Store Age]

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Retailers using pent-up cash; 58% plan to increase capital spending, with IT No. 1 priority

Retail executives have more cash, are adding employees and enjoying stronger revenue, but they remain quite guarded longer term, not seeing a complete economic recovery until 2014 or later, according to the 2012 Retail Outlook Survey by audit, tax, and advisory firm KPMG LLP.

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In the recent survey, 77% of retail executives indicate that their companies have significant cash on the balance sheet – up from 72% in KPMG’s 2011 survey – and 56% say their companies’ cash positions have increased from last year.

In addition, 64% say revenues are up from prior year (compared to 47% percent in 2011), and 52% say they have increased the number of U.S. employees. Interestingly, 22% indicate that their company’s headcount has returned to pre-recession levels – compared with just 18% in 2011.

Despite the positive sentiments in the report, caution remains the watchword of the day.

“The retail sector has experienced some positive momentum in the past year, but executive leaders aren’t about to throw caution to the wind,” said Mark Larson, KPMG global retail leader. “In this year’s survey, executives have pushed back their estimated timeline for economic recovery to 2014 or later, with concerns that decreased consumer confidence and continued high national unemployment are hindering a full retail recovery.”

While waiting for the recovery to take the hold, 58% plan to increase capital spending over the next year. The highest priority investment area is information technology – including data analytics and digital marketing channels – cited by 51% of the executives in the KPMG survey. Other significant areas of investment for retailers are new products or services (43%), geographic expansion (33%), and advertising and marketing (24%).

When asked about digital marketing channels, retail executives in the 2012 KPMG retail survey indicate that online shopping (59%), social media platforms (58%), and email campaigns (49%) are having the most significant impact on their businesses. Additionally, executive indicate that the incorporation of mobile technology is also having a significant impact, specifically mobile shopping (36%), mobile promotions (28%), and mobile payments (21%).

[via ChainStoreAge]