Once upon a time, merchandising was...
The evolution of merchandising reflects the constant renewal of the strategy of brands and chains over the years, in order to appeal to an increasingly volatile consumer. Let's look at the evolution of merchandising for a moment.
In the early days of trade, goods were displayed on open-air stalls or on the ground. Fabrics, basic necessities, clothes... To sell themselves, they relied above all on the oratorical talents of the merchant who, positioned behind his merchandise, called out to the customer and praised the merits of his products. The two parties would then discuss the price until an agreement was reached.
Time for the first shop
In 1852, the dynamic changed dramatically. Aristide Boucicaut, a French entrepreneur and businessman, had a brilliant idea: why not bring hundreds of items together in one place and allow the customer to choose freely?
Called "Au Bon Marché" (later "Le Bon Marché"), this establishment was the pioneer of commerce as it is known today and marked the beginning of self-service. It was soon copied in France and even abroad.
A true visionary, Aristide Boucicaut is considered the father of the modern shop. It was under his impetus that concepts such as layout and pricing were born. Gradually, these concepts were refined until they reached another milestone in 1963.
The birth of the hypermarket
In 1963, the French discovered the concept of the hypermarket. Thousands of items are grouped together on a surface area of several hundred square metres. While Le Bon Marché had a hundred or so items, the first hypermarket in the Paris region (Carrefour Sainte-Geneviève-des-Bois - 91) had just over 4,000 items on a surface area of 2,500 m2!
In essence, the principles remain the same: products are displayed on shelves, self-service frees the consumer from buying pressure, profit margins are reduced and sales are regular.
For manufacturers (or producers), the hypermarket is an opportunity to reach more people very quickly and to generate more profits. In order to establish their brands, retailers initially rely on one factor: price. It is only a question of demonstrating to the consumer that he will not find a better offer elsewhere for the same value.
Over the decades, as demand has grown and the market has become ultra-competitive, it has become clear that it is no longer enough for a product to be displayed on a shelf or to be the cheapest to end up in the customer's shopping trolley or basket.
A major challenge then arises: how to enhance the offer and capture the attention of consumers in the midst of so many references?
This is where the merchandising comes into play.
3 actors, 3 different but converging objectives
Merchandising covers the interests of three players: the consumer (the customer), the distributor (the point of sale) and the producer (the manufacturer).
The merchandising issues are different for each party:
- For the manufacturer, it is a question of selling more products from his range and optimising the shelf space to regularly sell his products and maximise the visibility of its products
- On the distributor's side, the objective is to sell better in order to make the most of the sales space while optimising the margin.
- For the consumer, merchandising saves time and makes it easier to make choices because it gives them access to a clear and quickly understandable offer.
For a long time, merchandising was the preserve of manufacturers. The latter wanted to preserve their market share and know the positioning of their products on the shelves. This was the assurance of optimal management of the space allocated to their brand in the shop and to guarantee profitability.
Their merchandising responded to techniques and a rigorous methodologyThis is supported by elaborate planograms and extensive market knowledge studies.
From the 1980s onwards, successive decades have seen the experimentation and implementation of numerous merchandising implementation techniques. This is true for both manufacturers and retailers.
Beyond science and techniques, a real strategy
Merchandising - or "merch" - is a set of Linear optimisation techniques. These techniques aim to highlight products while optimising their display surface on the point of sale shelves. The aim of merchandising is therefore to attract the consumer's attention to a brand's products and to encourage them to make a purchase. The aim of this display is to increase sales. As a result, it increases turnover.
The concept of merchandising originated with Charles H. Kepner. In his 1963 book "Modern Supermarket Operations", he issued the famous "5B Rule". This rule is still widely used today.
The 5B rule
The 5Bs are: the right product, in the right place, at the right time, in the right quantity and with the right information.
The right product
By the "good productGood merchandising means good assortments. Optimal merchandising depends partly on the choice it offers in terms of price, quality and the variety of products available to the consumer. Good merchandising should therefore offer a perfect product mix.
The right place
The " right place "The shelf is the place where the products are positioned in the shelf and/or the point of sale. Is it positioned at the top or bottom of the shelf? At the entrance to the shop? In the hot or cold zone? At the checkout? Most of the time, the distribution of the products is determined according to a very precise layout strategy to encourage the act of purchasing. Among the most common strategies are the promotion of new products and impulse purchases with permanent merchandising, but also on one-off merchandising during periods such as sales or destocking operations.
The right time
Who would bet on the sales of sun creams taking off in December? The reason: you have to choose the right "good time".This is because the calendar has a direct impact on customers' desires: Valentine's Day, Easter, back-to-school, Christmas... Reasons why the products put forward are not the same from one season to the next or during "high points".
The right amount
A customer who is loyal to his product is a customer who will not hesitate to go and get it elsewhere. Therefore, to avoid stock-outs, it is important to ensure that the product is in stock. "good amount. Effective merchandising also means having a shelf without a gaping hole and regular restocking. But the right quantity also means knowing how to adapt to the target, such as selling a product individually for singles or in a pack of 8 for a large family.
The right information
How annoying it is to be interested in a product, to want to buy it and to realise that you don't see its price tag or its information sheet! It is important for the customer to have the "Good information. Beyond the legal obligation to display information (composition, label, price, etc.), this information encourages sales. It increasingly enables consumers to compare products and meet specific expectations (price per kilo, organic label, product origin and labels, etc.).
The merchandiser, the product enhancement expert
The merchandising profession has also evolved
As we have seen, the concept of self-service was born, followed by the concept and science of merchandising. In its wake, a profession emerged: that of the merchandiser. Like merchandising, the profession of merchandiser has undergone many changes over the years.
The merchandiser is the man or woman in charge of optimising the visibility of brands on the shelves and the quality of product display.
Until the early 2000s, the work of the merchandiser was almost like that of a salesman. They were involved in permanent merchandising missions focused on the organisation of the space. The merchandiser was a "multi-client", i.e. he often worked for several manufacturers at the same time:
- control of the presence and stocks of the product in the shop
- price recording
- monitoring the commitments made by distributors,
- shelving
- Linear optimisation
- reframing...
In a caricatural way, we can say that the merchandiser was the "arms" of merchandising.
However, at the beginning of the 2000s, the scandals linked to the "délits de marchandage" (bargaining offences) involving certain supermarket chains put a stop to certain practices.
These various scandals have an immediate impact on the number of interventions carried out at the point of sale. In the wake of the lawsuits, the chains stopped financing permanent maintenance. Merchandising is therefore carried out by shop staff or by the manufacturers themselves via their sales force.
In parallel with merchandising, the merchandiser's job has also undergone profound changes, mainly driven by the rise of digital.
Even today, the role and missions of the merchandiser are constantly evolving and expanding, and are no longer limited to classic physical interventions.
Meet the Merchandiser 4.0
The merchandiser's job now requires more technical skills, combining both know-how related to the job and interpersonal skills that require the development of human and relational skills. Today, the merchandiser advises, makes recommendations on product orders, provides information and produces reports using a tablet or smartphone.
Gone is the role of a simple executor: with the feedback from his or her work at the point of sale, the merchandiser is now "connected" and has a fully-fledged role in the analysis chain of the famous data. The key word is versatility, in addition to the dynamism, rigour, commercial fibre and ability to listen that are required of them.
Because the consumer has new expectations, the needs of manufacturers have also evolved. The automation of tasks and the rise of digital technology have provided merchandisers with new tools that allow retailers to monitor more precisely than ever and in real time the interventions on the shelves, the installation of POP displays (shelf stoppers, displays, shelf heads, touch screens, etc.), their impact and, above all, to measure more accurately the ROI (return on investment) of their campaigns.
And there is now this interest in what is now called the "shopper", often assimilated to a sort of chameleon consumer who juggles between the multiple channels available to him - store and web. Freed from physical and geographical constraints, hyper solicited, hyper connected and over informed, the shopper 2.0 has longer reflection times and a virtually unlimited offer.
The challenge for brands is to capture their attention in order to encourage the act of purchase and build loyalty. Faced with a more volatile consumer, merchandising becomes a lever to improve and reinforce the user experience (UX) and the customer experience (CX).
Perspectives
It is easy to see that in this vast battle, merchandising is essential. It is becoming an essential tool for making the product or brand stand out in the eyes of consumers. Far from just optimising the shelf space, the levers of merchandising have also diversified: simplifying the flow in the shop, dramatising the offer through the presentation, layout and POS, animation, digitalisation, etc.
When using the 5B strategy, the sales professional should not forget that human beings are above all emotional creatures. For a consumer to trust an item or a brand, they must feel that they share its values. This is why merchandising is increasingly based on the emotional.
Moreover, in recent years we have seen the emergence of new trends such as emotional merchandising or e-merchandising.
Merchandising is more than ever a player in maximising sales and therefore still has a bright future ahead of it. Although its original role of enhancing the value of products remains, it is no longer the only one. In view of the profile of the 21st century shopper, it is part of the customer experience...
You want to be sure that your point-of-sale displays comply with your merchandising rulesWhat are your planograms and negotiated conditions?
Our teams of merchandisers, made up of expert profiles / autonomous pilots, can work on permanent merchandising missions, one-off merchandising missions or as part of interventions in commando.
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