News

How retailers can achieve differentiation with shopper-centric merchandising

BY CSA STAFF

By Jeff Weidauer, [email protected]_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 [email protected]_vestcom.com, or visit vestcom.com.

keyboard_arrow_downCOMMENTS

Leave a Reply

No comments found

Polls

Consumer confidence is high. Is that reflected in your stores’ revenues?

View Results

Loading ... Loading ...
STORE SPACES

Starbucks up green energy, cuts water use, pilots new EMS

BY CSA STAFF

Seattle — Starbucks Coffee Co. met its 2010 goal of purchasing renewable energy equivalent to half of the electricity used in its North American company-owned stores, the company reported in its tenth annual "Global Responsibility Report." The report details Starbucks’ fiscal 2010 performance in environmental stewardship, ethical sourcing and community involvement.

Starbucks, which purchased 58% of renewable energy in 2010, has been named by the U.S. Environmental Protection Agency as the fourth-largest purchaser of renewable energy in the United States. The company is raising its sights with a new goal to make 100% of the electricity used in global company-owned stores renewable energy equivalent by 2015.

As noted in the report, Starbucks did not achieve its goal to reduce energy consumption by 25% in company-owned stores by 2010. The company has pushed out the 25% reduction goal to 2015.

Starbucks said it piloted a new energy management system in 2010 in 10 U.S. stores, which validated its potential to reduce energy consumption through remote monitoring and control of heating, ventilation and air conditioning equipment. The company will expand the pilot program in 2011 to confirm its findings across a larger portfolio of stores.

Starbucks said it made meaningful improvements in 2010 toward reaching its goals related to recycling, water conservation, and green building. It said is currently on track to reach goals such key areas as:

  • Water conservation: Reduced water consumption by 21.6% over 2008 levels, nearing its stated goal of a 25% reduction by 2015.
  • LEED-certified stores: Completed pilot phase for the U.S. Green Building Council’s LEED Volume Certification pilot program. It is the company’s goal to build all new, company-owned stores to achieve LEED certification beginning in December 2010.
  • Recyclable cup solution: Making progress to develop comprehensive recycling solutions for its paper and plastic cups by 2012 by testing recyclability of cups in a New York pilot.

To read the report, go to starbucks.com/2010report.

keyboard_arrow_downCOMMENTS

Leave a Reply

J.Watson says:
Jun-11-2013 01:15 pm

Lynnwood Air Conditioning
I think with the speed with which starbucks are moving they will be a giant in energy production in US. They are making a steady growth towards what is there main goal and it looks they will achieve it. Lynnwood Air Conditioning

J.Watson says:
Jun-11-2013 01:15 pm

I think with the speed with which starbucks are moving they will be a giant in energy production in US. They are making a steady growth towards what is there main goal and it looks they will achieve it. Lynnwood Air Conditioning

Polls

Consumer confidence is high. Is that reflected in your stores’ revenues?

View Results

Loading ... Loading ...
News

Toys ‘R’ Us girds for online battle on Western front

BY CSA STAFF

The multichannel capabilities of Toys “R” Us were enhanced this week when the company announced plans to open a new online fulfillment center near Reno, Nev., that will allow for more timely shipment of West coast customers’ online orders.

The new 300,000-sq.-ft. facility about 10 miles west of Reno in the town of McCarren is scheduled to open this July. That’s good news for the upcoming holiday season as it means Toys “R” Us will be able to fulfill orders placed on Toysrus.com and Babiesrus.com throughout the western U.S within two business days or less via ground shipping via major carriers.

“As more consumers enjoy the simplicity and ease of online shopping, Toys “R” Us continues to invest in e-commerce enhancements to advance customer service and satisfaction across all shopping channels. We believe the McCarran facility will play an important role in further accelerating our company’s online business growth and order fulfillment,” said Jerry Storch, chairman and CEO of Toys “R” Us.

The new facility will be located in a newly constructed warehouse designed to meet Leadership in Energy and Environmental Design (LEED) Gold certification from the United States Green Building Council. According to the company, McCarran online fulfillment center is being constructed to accommodate high-tech innovations in warehouse control technology that will streamline inbound and outbound transport while employing efficient shipping process such as state-of-the-art robotic picking systems to move and complete outbound orders.

Once the distribution center becomes functional it will give the company a total of 12 facilities for store distribution and e-commerce fulfillment.

As is the case with other leading retailers, it’s all about achieving a multichannel vision at Toys “R” Us, which means serving customers however, whenever and wherever they choose to interact with the retailer’s brand. That means having the infrastructure in place to deliver, quite literally, on an ever escalating set of customer expectations.

A similar rational was evident late last month when Kohl’s announced plans for a new East coast online fulfillment center in Edgewood, Md. When the facility becomes operational in 2012 it will complement similar facilities in California and Ohio and round out the company’s ability to serve online customers nationwide in a more efficient and expeditious manner.

keyboard_arrow_downCOMMENTS

Leave a Reply

No comments found

Polls

Consumer confidence is high. Is that reflected in your stores’ revenues?

View Results

Loading ... Loading ...