Everything You Need to Know About Product Merchandising

Merchandising 101: Everything You Need to Know About Product Merchandising

Posted 2 years ago by Anastasia Prokofieva

혫Merchandising혬 is桂a桂word that gets thrown around a桂lot in桂conversations about retail. But what is桂merchandising, really? What do桂we桂mean when we桂use that word, and桂how are merchandising strategies implemented?

Broadly speaking, merchandising refers to桂strategies for桂the桂promotion and桂sale of桂tangible goods or桂products. But, of桂course, there is桂more to桂understanding merchandising than this simple definition. Merchandising can encompass a桂wide range of桂strategies and桂ideas. It桂can also be桂applied to桂several different types of桂retail businesses, including wholesale business as桂well as桂both physical and桂online stores.

Here is桂a桂deep dive into everything you need to桂know about merchandising strategies and桂benefits.

What is桂General Merchandising?

Merchandising does not simply refer to桂the桂marketing and桂sale of桂products. Merchandising strategies incorporate ideas like product quantity and桂prices, visual presentation, and桂the桂larger marketing strategies surrounding products. Essentially, general merchandising is桂the桂all-encompassing strategy geared toward selling retail inventory.

On桂a桂micro level, merchandising strategies are engineered to桂move specific products at桂a桂faster rate. Each product sold in桂a桂store has elements of桂its own unique merchandising strategy. However, on桂a桂larger scale, merchandising strategies are cyclical. 깝꾈桂other words, merchandising strategies follow a桂 in桂order to桂move certain products at桂specific times. Valentine�셲 Day items are usually heavily promoted in桂late January and桂February. A桂few weeks later, stores begin to桂promote Easter and桂Spring-themed items, and桂so桂on.

Other merchandising cycles may incorporate media products. For instance, the桂release of桂a桂new Disney movie is桂often accompanied by桂a桂wide range of桂products related to桂that film. All of桂these merchandising strategies are carefully timed and桂engineered to桂optimize product sales all year long. Merchandising is桂not just about one single product, but is桂a桂store-wide initiative to桂maximize all potential sales.

What is桂an桂Example of桂Product Merchandising?

For a桂quick illustration of桂what product merchandising looks like, picture an桂average American retail store in桂late June. The 4th of桂July holiday is桂a桂week away and桂the桂weather outside is桂beautiful. What is桂the桂first thing you see when you walk into the桂store? Most likely, you will see a桂red, white, and桂blue display with lots of桂cookout items or桂outdoor equipment. Depending on桂what state you�셱e in, you may even see some small packaged fireworks on桂display. If桂you�셱e in桂a桂grocery store, there are probably hamburger buns, condiments, and桂all sorts of桂grilling equipment.

This is桂all a桂targeted example of桂product merchandising. Retail stores anticipate that a桂high percentage of桂consumers in桂the桂early summer will be桂shopping for桂cookout gear. Whether they�셱e celebrating Independence Day, a桂high school graduation, or桂simply enjoying the桂weather, outdoor celebrations are huge this time of桂year. Retail stores engineer their merchandising strategies to桂highlight the桂products relevant to桂these types of桂activities and桂celebrations.

Of桂course, you may still be桂able to桂find many of桂these products in桂the桂store all year round. But when they are in-season, they are given a桂prominent display right at桂the桂entrance for桂everyone to桂see. This gives these products a桂greater chance of桂selling in桂high volume during periods of桂high demand.

What is桂Retail Merchandising?

Retail merchandising is桂the桂most common form of桂merchandising. Generally speaking, retail merchandising refers to桂many of桂the桂things already discussed previously. It桂involves strategies designed to桂sell specific products at桂the桂highest possible volume in桂a桂retail setting.

As桂previously touched upon, retail merchandising involves merchandising cycles and桂specific, targeted strategies. But retail merchandising also relies on桂things like cleanliness, organization, and桂presentation.

Retail stores need to桂optimize their store layout as桂part of桂their merchandising strategies.
Products should be桂organized in桂a桂way that is桂intuitive and桂makes them easy to桂locate for桂customers in桂the桂store.
Shelves should also be桂clean and桂organized so桂that customers feel relaxed and桂confident when in桂the桂store.

A桂messy store, with products strewn all over the桂place, is桂not optimized for桂merchandising.

What is桂Visual Merchandising?

Visual merchandising incorporates some of桂the桂previously-mentioned ideas about store layout and桂organization. However, visual merchandising is桂more than that. Visual merchandising refers to桂all aspects of桂product presentation. This includes lighting, product design, packaging, and桂visual promotional displays. Any visual component that makes it桂easier for桂customers to桂identify and桂purchase an桂item is桂visual merchandising.

Using the桂previous example of桂a桂summer retail display, the桂colors of桂red, white, and桂blue are often a桂prominent feature that time of桂year. These colors are a桂strong visual marker of桂4th of桂July-themed merchandise. Similarly, you might see a桂lot of桂pastel colors for桂Easter displays, or桂orange for桂Halloween.

But visual merchandising is桂also product-specific, and桂not just geared toward seasonal merchandising. Every product in桂a桂store is桂subject to桂some form of桂visual merchandising. Clothing items being displayed on桂a桂mannequin is桂a桂form of桂visual merchandising. Some stores merchandise certain prestige brands with prominent visual displays set apart from other products. Visual aspects as桂fundamental as桂aisle organization and桂lighting are also types of桂visual merchandising.

Another common strategy for桂visual merchandising is桂bundling. Bundling refers to桂the桂grouping of桂certain products together based on桂common or桂shared usages. For instance, a桂common bundle in桂spring might feature an桂array of桂gardening equipment. Anything stores can do桂to桂make products easier to桂access and桂identify is桂visual merchandising.

What is桂Ecommerce Merchandising?

To桂this point, our focus has primarily been on桂retail merchandising in桂physical, brick-and-mortar stores. But what about ecommerce merchandising? Online retail has taken a桂 of桂the桂overall retail space over the桂last decade. Merchandising strategies apply to桂ecommerce retailers just as桂much as桂traditional retailers.

Global Ecommerce Retail Sales from 2017桂to桂2025桂(Source: statista.com)

깝꾈桂ecommerce merchandising, the桂emphasis is桂placed on桂website layout and桂page displays, rather than physical displays. For an桂ecommerce store, in-demand seasonal items might be桂displayed on桂the桂website�셲 homepage. The homepage is桂comparative to桂the桂entrance to桂a桂physical store where one might usually see a桂prominent seasonal display.

Ecommerce merchandising is桂also about making the桂website intuitive and桂easy to桂navigate. Users should be桂able to桂easily locate items which they are interested in. Some websites might use banner ads promoting certain items in桂their store. Or桂the桂website may utilize intuitive search results.

Another common form of桂ecommerce merchandising is桂the桂use of桂 between associated items. This is桂a桂form of桂virtual bundling. Suppose you run an桂ecommerce store that sells sports equipment. A桂customer who is桂browsing baseball gloves on桂your website might also be桂interested in桂baseball bats, cleats, or桂other baseball equipment. Providing linking opportunities to桂these items on桂relevant product pages is桂an桂essential part of桂ecommerce merchandising.

How Does Merchandising Help a桂Business?

Whether online or桂in-person, merchandising has a桂wide range of桂benefits for桂retail businesses. We桂have already touched on桂a桂few of桂these benefits, but here is桂a桂more detailed explanation of桂how exactly merchandising is桂beneficial.

Increased Sales

Most obviously, merchandising leads to桂more sales. Merchandising strategies are optimized to桂draw customer attention to桂products of桂interest. Merchandising does not just make products easier to桂locate. Effective visual merchandising can also make products appear more appealing to桂customers, increasing sales even more.

Move Inventory at桂Faster Rates

Cyclical merchandising schedules rely on桂high inventory turnover. Stores want to桂sell as桂many winter items as桂possible before the桂start of桂spring, and桂so桂on. Merchandising helps sell promotional and桂seasonal items more quickly during the桂periods of桂highest demand.

Improved Customer Satisfaction

Merchandising strategies are also designed to桂optimize the桂customer experience. Visual displays, intuitive store or桂website layouts, and桂product bundling all help customers find what they need. Customers can shop more efficiently, and桂may even end up桂buying more items, when their shopping experience is桂made easier. This often means they will checkout feeling more satisfied with the桂products they are purchasing.

More Loyal Customers

That improved customer experience makes customers more likely to桂return to桂your business later on. This continues the桂cycle of桂a桂higher volume of桂sales, faster inventory turnover, and桂improved customer satisfaction.

Learn More About Ecommerce Merchandising

붚죕쳔 helps ecommerce businesses get off the桂ground and桂flourish online with many useful tools and桂resources. If桂you would like to桂learn more about ecommerce merchandising, read 붚죕쳔�셲 guide to桂creating effective product pages for桂your online store.

桂

About The Author

Anastasia Prokofieva is a content writer at 붚죕쳔. She writes about online marketing and promotion to make entrepreneurs�� daily routine easier and more rewarding. She also has a soft spot for cats, chocolate, and making kombucha at home.

붚죕쳔