Visual Merchandising should undergo an appropriate overhaul. Article 1/2

Adapted banner image by Ojan

Adapted banner image by Ojan

This is the first article in a series of two concerning Visual Merchandising processes. The content of these articles is the outcome of a survey performed by interviewing 50 retailers throughout Europe:

  1. Current Challenges
  2. Opportunities for change
     

When it comes to Visual Merchandising, many retailers lag behind. This is the outcome of our survey by interviewing approximately 50 retailers throughout Europe performed during 2012 – 2013. This survey clearly shows that the efficiency of the current Visual Merchandising processes should be analyzed and adapted accordingly.

While the sales of online shops have grown rapidly for the last years, the growth of brick-and mortar only has increased slightly. Numerical this means sales of retail stores have grown since 2008 by 8,5% and the ones of online shops by 72%.

 
 

What are the current problems of VM processes?

PDFs, Power Point Presentations and Picture Files – many retailers have no coherent method of organizing documents and the communication of instructions. For example 63% of them use excel spreadsheets for compiling data. Not only that it takes a lot of time coping with all this paperwork and organizational challenges, it also costs a lot of money. Still 1/3 of the retailers send out printed instructions via interoffice mail or normal post.

Shipping and printing costs should not be underestimated. Moreover 37% of retailers say that 1-3% of annual sales are lost due to non-compliance of in-store merchandising; 20% even lose more than 10% of annual sales.

 
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Important to say is that our survey does not stand alone; regarding to the survey of RIS News (published in July 2013), 53,8% retailers say they have to cope with the challenge of a disconnection between merchandising, marketing and store operations. “Inaccurate planograms, weak chain-wide compliance and infrequent measurements of campaigns” are described as the main issues.

By speaking to visual merchandising managers our survey showed that many retailers are not able to measure the execution of instructions or compliance regularly. Spot tests are the rule rather than strict reporting systems.

This is mainly caused due to insufficient times the regional managers have to face.  In many cases the store personnel have no possibility to react to instructions or send pictures back. Regional Managers also explained that the process of taking pictures, uploading them and finally sending them is complicated and takes a lot of time.

 

Stay tuned for more surprising results from the survey in next week’s blog post.

 
Stephen WarrComment