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.

RIS News, RBM Technologies, Known Problem Management

What is Known Problem Management?

RIS News recently issued a custom research report (available here) exploring the pain points associated with in-store merchandising. The research uncovers compelling evidence that now is time for retailers to tackle the problem. Over the course of our recent blog series, we examined a number of issues currently preventing retailers from becoming more compliant, and the situational factors bringing about changes for the better.

In this post, we look at the macro-level trend of Known Problem Management being adopted by retailers nationwide, a trend that seeks to address and alleviate many issues facing retailers today.

RIS News, RBM Technologies, Known Problem Management

In retailing, KPM is a new acronym (as if we needed another!). KPM, which was coined by the author of this report stands for Known Problem Management. While you may have never heard the term before, if you work in retail IT, you certainly know what your KPMs are. For some, it’s cumbersome legacy systems that prevent your organization from applying the latest technologies and techniques. If you’re reading this blog, your KPMs likely include ineffective merchandising strategies.

For complicated reasons that go far beyond the scope of the IT department, KPM issues are rarely fast-tracked for resolution. Things like shrink, heterogeneous databases and legacy systems in the tech stack linger year after year with no end in sight.

Adding to the KPM list is inaccurate planogram knowledge. Without precise planogram accuracy down to the fixture level, in-store merchandise planning and execution is a crapshoot that produces high levels of waste and lost revenue at the very least, and disappointed shoppers at the very worst.

The RIS News custom research report explores the KPM of in-store merchandising and uncovers compelling evidence that it is time for retailers to address the problem head on. With the right visual merchandising solutions, campaign planning, execution and compliance becomes easier; communication with corporate headquarters is clear and precise; and most importantly, retailers save valuable time and money.

When the right product and messaging is delivered to the right store, at the right time, and placed on the right fixture, retailers can drive the customer experienced envisioned – addressing a key known issue in the process.

What are some of the KPMs within your organization? And, what are you doing to address these issues? We would love to hear from you in the comments section below. Please feel free to also reach out to us on @Merch_Matters.

A free copy of the full RIS News research report is available here.

RBM Technologies, RIS News, Mannequins

Optimizing In-Store Merchandising – Part 3: Measuring the Costs and Making the Change

RIS News recently issued a custom research report (available here) tackling the issues surrounding in-store merchandising. The research uncovered compelling evidence that suggests now is time for retailers to tackle the problem. Over the course of this series, we will examine a number of issues currently preventing retailers from becoming more compliant, and the situational factors bringing about changes for the better.

In this post, we look at the costs associated with improving in-store merchandising and solutions to making that change.

To get at the heart of what is clearly a challenging problem for retailers, RIS News asked senior-level retail merchandisers to estimate the percentage of lost annual sales they attribute to non-compliance of in-store merchandising.

RBM Technologies, RIS News, Mannequins

Thirty-seven percent said that up to three percent of annual sales are lost due to non-compliance. That means, for a company with a billion dollars in annual sales, up to $30 million is lost as a result of holes in in-store merchandising practices, and a key factor in justifying a corrective investment. The scariest part is that for nearly 15 percent of respondents, the percentage lost was upwards of 14 percent.

In addition to lost sales, waste is another problem that arises from inaccurate in-store merchandising practices. For the purposes of the research report, waste was defined as over shipping of product, over printing of materials, and cost of shipping materials that can’t be used in some stores. Nearly half of all respondents estimated their waste to be between six – 16 percent annually.

When you add the amount of loss incurred from waste to the dollar figure associated with lost sales caused by non-compliance, it is apparent that a great deal of corporate revenue is within grasp for those retailers willing to reach for the low-hanging fruit.

In the five-year period from January 2008 to January 2013, retail store sales have grown 8.5 percent while online sales have grown 72 percent. Yet brick-and-mortar stores continue to be the centerpiece of the retail industry and source of the lion’s share of revenue.

As a result, many retailers are focusing on customer-centric strategies that put digital capabilities inside stores, converting them into omnichannel hubs that expand and improve the shopping experience to attract and keep customers.

However, this strategy is only half of the solution. The other half is to solve known problems in the store that produce a measurably negative impact on sales. Chief among these is the low-hanging fruit of inaccurate in-store merchandising campaigns.

Today, the bulk of the retailing industry is operating with known data gaps, inaccuracies at the store level and workaround tools that are sorely in need of upgrading. Merchandising plans and forecasts are based on historical or aggregated averages that are essentially guesswork instead of hard science.

The ultimate solution is to tie customer-centric improvements in the store with in-store merchandising improvements that increase sales, conversions and customer satisfaction while enabling efforts to reduce waste and lost opportunities.

Does your company currently implement visual merchandising solutions to ensure campaign compliance at the fixture level? We would love to hear from you in the comments section below. Please feel free to also reach out to us on @Merch_Matters.

A free copy of the full RIS News research report is available here.

RBM Technologies, RIS News, Research report, blog 2

Optimizing In-Store Merchandising – Part 2: The Store Compliance Challenge

RIS News recently issued a custom research report (available here) tackling the issues surrounding in-store merchandising. The study uncovered compelling evidence that it is time for retailers to tackle the problem. Over the course of this blog series, we will examine a number of issues currently preventing retailers from becoming more compliant, and the situational factors bringing about changes for the better.

In this post, we look at the challenges retailers face in their efforts to remain compliant.

RBM Technologies, RIS News, Research report, blog 2

It is important for retailers to measure how well stores do in managing merchandising execution and report their compliance back to headquarters. As we noted in Part 1 [URL] of this series, only 3.7 percent of retailers report having accurate planogram knowledge down to the fixture level.

According to RIS News, a quarter of retailers say they do not measure store execution and compliance regularly. Seven percent only measure it once or twice a year and a much larger group (18.5 percent) say they never do it at all. However, three in ten retailers report measuring store-level compliance frequently enough to catch problems and correct them.

So, what do those retailers find when they measure store compliance for merchandising campaigns?

Only one in ten say that more than 90 percent of stores are compliant across the chain for the average in-store merchandising campaign. Compliance of 90 percent or higher indicates strong store discipline and leads to increased campaign results. In short, that’s where you want to be!

With a proven model of campaign compliance leading to increased revenue and accurate execution, why are more retailers unable to attain a high-level of compliance across all stores?

Aside from budget constraints, which are always a high-wire act of balancing competing priorities, the biggest inhibitor to solving non-compliance problems is a “disconnect between merchandising, marketing and store ops,” according to nearly 54 percent of respondents. This familiar organizational challenge was by far the top obstacle cited. Other top challenges cited were increasing pace of change (34.6 percent) and labor limitations (30.8 percent).

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Figure 1: Challenges preventing organizations from getting stores to be fully compliant

Of the top three challenges cited for achieving greater merchandise campaign compliance by stores, the one with the best chance of success is streamlining differences between merchandising, marketing and store operations. Like all the challenges on the list, this is a tough nut to crack, but not an impossible one.

Sadly, the king of in-store merchandise planning, communication and compliance tools today is Excel. By a landslide majority, Excel (63 percent) was named the solution most retailers use for in-store merchandise planning. Clearly, there are reasons to support this finding, chief among them is that Excel is ubiquitous in most companies and helps meet marginal expectations for campaign compliance.

However, one of the major takeaways from the RIS News report is that use of Excel in merchandising operations is a known problem in compliance efforts at the fixture level. Other culprits on this list include inaccurate planograms at the store level, weak chain-wide compliance during merchandising campaigns, infrequent measurement of campaigns at the store level and outdated planogram surveys.

The silver lining is that these problems are solvable once a comprehensive solution is adopted, and will result in significant sales and margin benefits once compliance is met.

In our next post, we will examine the situational factors that are contributing to retailers adopting more accurate campaign compliance processes and how to measure the cost of doing so.

Does your company currently implement visual merchandising solutions to ensure campaign compliance at the fixture level? We would love to hear from you in the comments section below. Please feel free to also reach out to us on @Merch_Matters.

A free copy of the full RIS News research report is available here.

RBM RIS News Research Report

Optimizing In-Store Merchandising – Part 1: The Revolution of Brick-and-Mortar Stores

RIS News recently issued a custom research report (available here) tackling the issues surrounding in-store merchandising. The study uncovered compelling evidence that it is time for retailers to tackle the problem. Over the course of this blog series, we will examine a number of issues currently preventing retailers from becoming more compliant, and the situational factors bringing about changes for the better.

In this post we introduce many of the issues retailers are facing to remain campaign compliant and the revolution in brick-and-mortar stores that will bring about change.

RBM RIS News Research Report

First, the bad news. As retailers labor to meet customers’ needs with omnichannel strategies, and the complexities of brick-and-mortar retail continue to grow, campaign planning and forecasting has deteriorated.

The RIS News research report examines how many retailers have a problem with in-store merchandising accuracy. Anecdotal evidence from discussions with merchandisers indicate the problem is large and is supported by the research report that found only 3.7 percent of retailers have exact accuracy of planogram knowledge down to the fixture level for all their stores.

RBM-RIS-News-accuracy-planogram

Retailers have lost confidence in their stores’ ability to execute localized campaigns quickly and effectively. Campaign intricacy is accelerating with products, POP, kits and creative being shipped to stores on a more frequent basis. In addition, communication from headquarters to stores typically lacks timeliness and relevance.

These inefficiencies not only waste time and lead to confusion, but also impact profit margins in the form of overprinting, shipping costs, and lost sales due to untimely and inaccurate product mix and messaging.

Now the good news. With the right suite of visual merchandising management solutions, an accurate merchandising planning process is attainable. With these tools, communication becomes clear and precise, and retailers save time and money. Visual merchandising management solutions enable retailers access to real-time information needed to carry out accurate localized campaigns to their stores.

When the right product and messaging is delivered to the right store, at the right time, on the right fixture, retailers can drive the customer experience envisioned in the original planning process.

Over the course of this series, we will examine some of the specific issues holding retailers back from becoming more compliant, the factors causing them to change their approach to in-store merchandising for the better, and finally how Known Problem Management (KPM) can help retailers identify problems and work toward a long-term solution.

Does your company currently implement visual merchandising solutions to ensure campaign compliance at the fixture level? We would love to hear from you in the comments section below. Please feel free to also reach out to us on @Merch_Matters.

A free copy of the full RIS News research report is available here.

top retail stories of the year, 2012, retail localization

Top 10 Most-Read Stories of 2012

As readers, it’s only natural to like seeing items in lists – short, sweet, and to the point, which is why many top 10 lists were the stories you were most interested in reading on risnews.com in 2012. By researching Web page views for all stories posted to the RIS Newswebsite this year, we have compiled a list of the top 10 most-read stories of 2012.
top retail stories of the year, 2012, retail localization
Listed below are the Top 10 Most-Read Stories on risnews.com in 2012, including the date posted:
Top 10 Most-Read Stories of 2012
1. Top 10 Retail Companies to Work For (posted Dec. 19, 2011)
2. Best of NRF 2012: Top 10 Takeaways  (posted Jan. 18, 2012)
3. Best and Worst Companies in Retail (posted Aug. 10, 2012)
4. Bottom 10 Retail Companies to Work For (posted Dec. 27, 2011)
6. 10 Retailers That Shook the World Part 2 (posted Feb. 28, 2012)
7. Top 10 Retail CEO Salaries (posted Mar. 20, 2012)
8. Talbots Closing 83 Stores in 2011 (posted Dec. 6, 2011)
Another trend noted in the top 10 list is the interest in which retailers are looking to move away from the traditional POS, moving toward mobility and the omni-channel experience. Cabela’s use of mobile apps, social media, optimizing inventory , and digital sales to become a true omni-channel retailer has rounded out the top 5, followed by Talbots store closings in eighth, JCPenney’s  use of RFID in ninth and Urban Outfitters moving completely to mobile POS in tenth.

[via RIS News]

zumiez-retailer-shopper-marketing

Top and Bottom 5 Retailers of July

The second half of the year will be make-or-break for both ends of the retail spectrum. Can retailers in the bottom five rebuild for a dramatic turnaround to make 2012 a success? Can those in the top five maintain a lead? While several retailers have been missing expectations, others have been outperforming the market. According to Thomson Reuters, three-quarters of retailers reporting results beat expectations for comparable store sales in July. Overall, retailers have seen the strongest sales in the northeast and Midwest, a sign that despite shoppers caution, they may be beginning to find a sense of security.

zumiez-retailer-shopper-marketing

“Retailers have been so cautious in the past six months in every area of expense as well as controlling inventories, that they are positioned for excellent financial performance for back-to-school and headed into Holiday,” said analyst J. Philip Leichliter of J. Philip Group LLC. “Off-pricers have a strong position because they have benefitted well from the customers they picked up and retained during the recession, and are very focused on their merchandise strategy and continue to reduce inventories and increase turn.”

Of the 20 retailers tracked by same-store sales results, here are the top five and bottom five retailers in July:

[via RIS News]

iPad Point of Sale Tips, Retailers, Retail Localization

4 iPad POS Suggestions From Retailers

Tablets have invaded the homes of consumers–and Apple is the King of this generation of mobile computers. Since the iPad’s initial announcement in 2010, Apple has sold nearly 80 million iPads. The mobile computer’s next ring to dominate? Your local department store or collectibles shop.

iPad Point of Sale Tips, Retailers, Retail Localization

According to a survey from RIS News, 28 percent of retailers are currently testing tablets in their stores and 31 percent plan to begin some form of testing in 2012. There are a number of benefits that retailers can realize utilizing a mobile tablet at the point of sale (POS), such as shortening of the checkout line and providing instant product answers for customers’ questions.

Another survey from AisleBuyer found that 64 percent of shoppers thought retailers were more helpful when using a mobile device in the store aisles.

Michael Koploy, Retail Analyst for Software Advice, recently spoke with three retailers that have deployed iPad point of sale solutions in their stores. Koploy asked what they’ve learned throughout the process and what they would suggest to other retailers thinking about using iPads at checkout. Here are their four suggestions:

  1. Don’t purchase too many iPads up-front: One of the strongest selling points of iPads is the ease of their deployment and their scalability. That being said, retailers advised other retailers to purchase iPads modestly at first–making a one-for-one switch of registers for iPads. If more tablets are needed at a later date, the retailer can then purchase more iPads online or at most electronics stores.

  2. Upgrade Internet bandwidth and wireless security: When moving to mobile POS solutions, upgrading the store’s infrastructure is a worthwhile investment, according to the retailers interviewed. Increased bandwidth and improved security are two areas that retailers should research and update in their stores to reduce downtime and improve transaction security. Wireless routers should meet Payment Card Industry (PCI) standards, encrypted with either WPA or WPA2.

  3. Ask for help from resellers and MDM experts: The retailers also suggested reaching out to other technology experts for assistance with device deployment and management. Software resellers can help retailers connect the hardware and software solutions, as well as integrate data from previous or existing technology. Mobile device management (MDM) experts can help lock-down devices and integrate data across stores–an important consideration for retailers that have multiple locations.

  4. Utilize the iPad during checkout: The iPad is a fully-capable piece of hardware to manage the point of sale. At the same time, it offers a number of options for the retailer to improve checkout–and the overall shopping experience, as well. From the aisle, retailers can help customers research products, check inventory levels and process the transaction–without having to ever get in a long checkout line. Additionally, retailers can use the device’s camera, web browser, and social media applications to allow customers to share their experience with their friends and family. This presents a powerful marketing platform for the retailer.

To hear more tips from these retailers, check out: 5 iPad POS Tips For Retailers, From Retailers.

Motorola Solutions, ET1 Enterprise Tablet, RBM Technologies, RIS News

RIS News Hosts Web Event on Tablet Strategies for Retail

Retail and Mobile Experts from Motorola Solutions, RBM Technologies and IHL Group to Share Strategies for a Two-Tiered Approach to In-Store Tablet Deployment

Motorola Solutions, ET1 Enterprise Tablet, RBM Technologies, RIS News

CAMBRIDGE, Mass.–(BUSINESS WIRE)–RBM Technologies and Motorola Solutions will offer industry expertise on retail tablet deployment and enterprise productivity at the RIS News webinar, “Two-Pronged Approach to Tablet Strategy”. This panel discussion will focus on strategic ways for retailers to capitalize on the recent tablet boom. Panelists will share their experiences and advice for retailers interested in using tablets to improve in-store operations, while reducing costs and driving sales.

Participants will hear about a two-tiered approach to deploying tablets that involves line-busting and selling, where tablets are deployed on the sales floor to improve customer engagement through upselling and clientelling; and enterprise productivity, where retailers use mobile devices in store operations and sales-support roles. Each of these tactics requires a separate set of goals, objectives and business plans.

Who: Greg Buzekm, President, IHL Group
Scott Moreland, Principal – Retail Industry Solutions, Motorola Solutions
Dan Wittner, Executive Vice President & Chief Operating Officer, RBM Technologies
Moderated by Joe Skorupa, Group Editor-in-Chief, RIS News
What: Two-Pronged Approach to Tablet Strategy
When: Thursday, March 15 at 12:00pm Eastern
To register: http://risnews.edgl.com/web-events/Two-Pronged-Approach-to-Tablet-Strategy78734

About RBM Technologies

RBM Technologies provides the only retail communications platform that ensures store compliance with fixture-based planograms and localized execution. The company’s Web-based visual merchandising management solution cuts the cost of in-store merchandising and promotions and drives revenue with localized campaign planning and compliance reporting for some of the world’s largest brands including AT&T, Verizon, Capital One, BMO/Harris Bank, T-Mobile, O2 and Rogers. Founded in 2000 and headquartered in Cambridge, Mass., RBM is led by a team of retail and technology visionaries who have redefined the concept of visual merchandising management through a unique set of solutions and services. For more information about RBM Technologies visit www.rbmtechnologies.com, call (800) 532-2468 or email [email protected].