The concept of merchandising

To define Visual merchandising, it is important first to look at what merchandising is. Merchandising is a branch of marketing theory and practice concerned with increasing product sales by designing, packaging, pricing, and displaying goods in a way that stimulates higher sales volume. The main thing in merchandising is that consumers may have a general need for (or interest in) a certain class of product, and it is the merchandiser's task to place and present the product in a better way that draws consumers' attention and persuades them that very product meets their need and requirements.

A particular merchandising campaign can involve many considerations, such as:

§ product packaging

§ signage

§ location in the store

§ shape, size, color, and other physical characteristics of the display

§ advertising (in-store and other means)

§ discounts, prizes, or other promotional offers.

When people hear the term merchandising, many think of window displays or perhaps the mass proliferation of Disney memorabilia. However, merchandising is a much broader concept, encompassing everything a company does to package and present its products or services.

The goal of merchandising is to make for the consumers the better and easiest access to the goods in stores. It may seem obvious, but there is a science to merchandising. A poor or confusing layout will frustrate customers and drive away sales even if they like what is in your store.

For some businesses, merchandising means creating visual displays that draw customers to a tangible product. For others, such as consulting or law firms, it is the presentations they conduct to show prospective clients what they have to offer. In either case, effective merchandising demonstrates expertise and style and gives both potential and existing customers the chance to see products or services in action.

Many of the merchandising techniques being traditionally used by the retailers can be adapted for wholesalers, manufacturers and service companies to promote a product. Window displays – that’s what people notice first about a company, other than the front of the building, and it can be a very powerful advertising mean. In addition to spotlighting of the specific products, windows can reflect a specific atmosphere and ambiance.

Lighting can be used for to both - to create a certain atmosphere and to highlight merchandise. Despite that lighting fixtures are rather expensive, however, lighting is very essential to your overall product presentation.

Counters and shelves provide variety of merchandising opportunities. For example, " facing" - a technique used by many retailers – of keeping all the stock products pulled out to the front of the shelves to give a better view and access to a full inventory and create a more positive image of the store. Retailers can also set up counters and shelves to guide people through the store or to create special display areas. It’s very important for the store layout to meet the customers needs. On the other hand, customers in a hardware store are likely to prefer straight aisles with clearly labeled products that are easy to reach.

1.2. Merchandising analysis

Merchandising analysis allows a company to improve the planning, placement (lay-out) and presentation of products to meet the market needs, with the goal of optimizing the products range to achieve higher profitability. Sales, product and store managers monitor the impact of merchandising attributes like product placement, packaging and shelf-space area.

Additionally, clear understanding of what are the specific segments that customers buy enables more effective store design, better product range and better placement (lay-out) combination of different products. Sales policy also provides statistics that helps to identify product range that can be used to forecast sales volumes.

To conclude this chapter I’d like to note that the employment of traditional techniques of merchandising is very important. The proper use of shelves, counters and lightings increase the demand. Merchandising analysis is also a very important part of merchandising, because it reveals the specific segments.