Store layouts and clever merchandising can certainly drive sales if they are able to sway shopper behaviour.
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There is a school of thought that says if you have the right product in the right place at the right time, it will sell. And up to a point this is certainly the case. There is also the other retail maxim that you can sell a good product in a poor environment, but the process does not work the other way around.
Again, this is not really open to dispute. There is, however, the thought that the sum of the two parts - appropriate environment with good product - is likely to be a more powerful force than either of its two individual constituents.
This may go some way towards explaining why retailers spend so much time, energy and indeed money on creating store interiors that have a point of difference. But is it really worth the effort and does improving the customer experience mean incremental sales?
Jim Thompson, managing director at design consultancy 20/20, says: “What most clients want to do is to drive up average transaction values, encourage frequency of visits and foster loyalty.” And coming from a company employed to make this a reality, the implication must be that this is, in some measure, possible. Most shoppers would like to buy merchandise that represents value for money and that is displayed in
an aesthetically pleasing manner on a display that is part of an eye-catching and easily understood layout.
There is, however, the little matter of commercial reality. Thompson puts the case starkly: “You want to maximise the value of your shelves. But there’s a point where the pile-it-high ethos doesn’t actually increase the value of what you are selling.”
Marks & Spencer director of store design and marketing Nayna McIntosh agrees. “The commercial beast in all of us wants to maximise the density at all times,” she says. “But it’s interesting walking around a store in February and comparing it to what you see in December. There’s more room to breathe for shoppers and stock.”
It is also probably the case that as retailers continue to cut back on the space they devote to stockrooms, the requirement to overfill sales floors, to last until the next delivery arrives, becomes rather more pressing. But does more stock mean more sales?
Jeff Kindleysides, managing director of design consultancy Checkland Kindleysides, thinks not. “No. It’s about clarity,” he says. “An edited choice is probably more powerful than an unedited wider choice that’s very difficult to read. In the mid-market this is very important and it’s about creating real differentiation when many of the products that are sold may be very similar.”
Less can be more If this is the case, then there is surely a trade-off between stock density and the number of staff required to keep presentation standards up to scratch.
Less, in this instance, will probably cost more to service as shopfloor stock will need replenishing more frequently, but will result in a rather more appealing store environment.
But even before you get to the business of deciding how much merchandise should be displayed in a given space, there is the question of store layout to be considered. DSGi head of store design Michael Dykes says there is a very clear process to be followed when apportioning space within an interior. “We tend to start by doing bubble diagrams mapping customers’ journeys in a store and looking at the cold and hot areas,” he says. “In terms of layout there are cold and hot areas in a store.” The back of a store would be a “cold area”, he says, particularly in the context of a very large edge-of-town shed.
In large branches of Currys, this is overcome by having a wall of TVs at the back - effectively forcing shoppers to look beyond their immediate surroundings and to see through the space. In Currys’ J9 megastore, one of the UK’s largest Currys, next to the M6 near Birmingham, there is also a wall composed of washing machines and tumble dryers stacked on top of each other. This allows what Dykes refers to as “intuitive shopping” - where shoppers find their way around a store through the use of the merchandise as a signpost.
Talk to any store designer, however, and in addition to ensuring that shoppers can navigate a store interior and that an appropriate quantity of merchandise is on display at any particular moment, you are also likely to hear about “storytelling”. It is something we almost take for granted in most fashion stores. Kindleysides says: “You can affect the behaviour of people in your shop by where you put product and how you present it. You need to get your storytelling right. Topshop do this to an extent. They’ll tell a [merchandise] story in one area and then you can see the same products in a different area
of the shop used in a different way to create a different story.”
It’s a rather different case in other retail segments. Food retailing, for the most part, is about efficiency rather than storytelling. Grocers try to maximise throughput and to display product in long aisles along which systematised commodity presentation of food categories is the order of the day. They are changing, however, and learning from the fashion sector.
Kurt Salmon Associates senior consultant Kevin Dearing says that in food retailing there are certain destination products, such as eggs, milk and bread, and that the trick is to position impulse buys among these. He notes that grocers are increasingly looking at fashion retailers to try to build product stories. In practice this means that if, for instance, there is an aisle of ready meals, the retailer will try to generate additional sales by putting an appropriate bottle of wine next to the product.
Laurent Thoumine, a partner in Kurt Salmon Associates’ French office, says grocers also need to be able to “enchant” shoppers. “We’ve got a project going on at the moment to try to do this,” he explains. “Promotions no longer seem to attract shoppers, so you need to entertain. This means a “wine festival” in a French hypermarket and a programme of events aimed at making visiting a retailer of this kind more of an experience than a chore. Customer interaction, rather than newer equipment, is a better way of ensuring increased sales, he says.
Curiously then, the various diverse segments that together form the retail sector are on something of a convergence course when it comes to the approach taken to store design and getting more out of an available space. Storytelling, clarity of layout, amount of stock on a piece of display equipment and the manner in which this is done are all central to the business of shifting stock and are all considered by all retailers, irrespective of the arena in which they operate.
And perhaps the ultimate example of storytelling and meeting shopper requirements is provided by Dearing. He points out that food retailers such as Spar in Ireland are re-merchandising their shelves twice, and sometime three times, in a day to cater for the different shopper types that are likely to come into a shop in the morning, at lunch and in the afternoon. Perhaps even the quick-change fashion retail artists could do well to note how this garners additional sales.
There is rather more to effective retailing than putting the right stock out at the right time, with the right price and in the right place. Competition ensures that a lot of retailers are able to do this, which means design and good visual merchandising could make all the difference.