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How retailers can achieve differentiation with shopper-centric merchandising

By Jeff Weidauer, jweidauer_@_vestcom.com

One of the drawbacks of today’s connected global economy is the pervasive homogeneity in nearly everything. One can visit any state -- indeed, nearly any country -- and see many of the same stores and restaurants offering the same products.

The retail industry in the United States has been suffering from this lack of differentiation for some time. It’s been a long-standing concern in the food industry in particular that once inside a supermarket the customer couldn’t tell where she was because supermarkets all looked alike. Over the last 10 years stores have focused on the fresh perimeter of the store in hopes of providing a unique identity, but with mixed results. The center store suffered the most; every retailer was selling the same products in the center store, so differentiation was nearly impossible.

When the economy soured and people started staying home to eat, interest turned to the center store, but the industry wasn’t ready for the change. Shoppers still found themselves looking at the same products, with nearly the same prices, merchandised in the same way. While this consistency was easy to navigate, it didn’t make for a compelling or engaging shopping experience.

As things have picked up, interest in eating at home has remained and consumers are looking for new ideas for dinner. Many retailers are responding with additions to private brand programs, which can be excellent differentiators with the proper approach. Effectively using a store brand to create a point of difference means the product can’t just be a cheaper knock-off of an existing national brand. To truly provide a reason for the shopper to come back to the store for that item, it needs to be unique in its own right, not available from a national manufacturer or competing retailer. Yes, the bar has been raised significantly, and only those willing to take some bets and invest resources will succeed in this arena.

Another reason the center store became overly generic in its appearance to shoppers was the addition of third-party advertisers placing all manner of signs and shelf talkers at the shelf edge. These advertisements paid their way onto the shelf, but not necessarily through sales growth. Because the same ad would appear in every store at the same time, it exacerbated the existing problem. Over time, the signs became larger, shelf talkers became “aisle violators,” and the product was nearly lost behind the proliferation of signage. As retailers have refocused on the center of the store, they’ve been pushing back on signage, instituting clean store policies that limit the size and number of these signs. This has helped to improve the appearance of the aisle, but the challenge remains how to promote products at the shelf in the center of the store.

The best answer is the simplest one: start with the shopper, and think the way she thinks. That’s generally the best practice in retail. Make it easy to find products, and use consistent signage at the shelf to promote them. The shelf edge -- now clear of all the competing messages -- remains the most effective way to communicate with shoppers and the best bet to influence purchase decisions.

This influence isn’t the result of bigger, louder signage. It’s best accomplished through the use of consistent messaging that offers the shopper information she needs at the critical point of decision. Most shoppers learn about new items while standing at the shelf, so that’s the best place and time to educate her on the merits of a product.

The upshot is that the “less is more” rule definitely applies. More and bigger signage is less effective than smaller, more consistent and more shopper-centric communication presented in a way that informs the shopper and makes her experience more enjoyable.

Jeff Weidauer is VP of marketing and strategy for Vestcom International Inc., a Little Rock, Ark.-based provider of integrated shopper marketing solutions. He can be reached at jweidauer_@_vestcom.com, or visit vestcom.com.

© 2014
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