Director, eCommerce

5 Principles of In-Store Retail Merchandising that Apply to Online Stores

The line between online and offline shopping is becoming increasingly blurred as shoppers use both in tandem to fulfill their needs. Smart retailers know that, despite the two being separate entities, shared merchandising principles exist between them. Here they are;

Principle 1. Think about product placement as the first item of importance. 

Bricks-and-mortar stores are familiar with the importance of strategic product placement, with supermarkets being especially savvy at this. Consider the last time you went grocery shopping: Produce is placed at the front of the store so shoppers will fill their carts with fruits and vegetables; this makes them think that once they’ve checked off the healthy items on their lists, it’s okay to throw some junk food—which is marked up considerably—in their carts as well.

Smart online retailers have learned this lesson well from offline stores, placing products that showcase their brand on the front page and drawing a lot of attention to it. They also tailor landing pages to their customers, offering a search bar and brand descriptions for newer shoppers so they can familiarize themselves easily and providing suggestions for returning customers.

Principle 2. Showcase product use by placing similar items together.

Walk into any bricks-and-mortar store and you’ll immediately notice that the retailer demonstrates how the product is to be used. In clothing stores, mannequins wear layered outfits; bookstores surround novels with blankets and candles; and music retailers arrange CDs with earbuds and headphones.

While mannequins don’t have the same efficacy online as they do offline, online retailers can still use the same concept by placing like-minded items together, showcasing testimonials and reviews and creating an “ideas” section where shoppers can compare items side by side.

Principle 3. Recognize holiday-targeted marketing as an opportunity.

At least one month before major holidays—or more than two for Christmas—offline stores start ramping up specialized marketing campaigns aimed at the holiday using a variety of colour schemes, buzzwords and themed sections. A furniture store will group chaise lounges, umbrellas and patio tables together with summer accessories for the May long weekend, while movie theatres will bombard shoppers with posters of hit movies around awards season.

This is a fairly common concept for online stores because it’s easy to code different images and layouts for holidays—for example, all that is required during the Christmas season is rearranging the coding to showcase Christmas wish and gift lists, shopping options and holiday-related themes. Another trick that online merchandisers use is sorting their products by price and category, with the former offering shoppers options for gifts under X number of dollars.

Principle 4. Recognize the habits of impulse buyers. 

Just about every bricks-and-mortar store features a selection of low-price items beside the till, with convenience stores being the best example. Colloquially known as stocking stuffers, impulse buys and till-side advertising, these value items have been shown to increase purchasing when placed in front of the customer when they’re paying.

Although it’s physically impossible to place actual objects beside a till in online stores, the essential concept remains the same: The final purchase is split horizontally in half, with the basket and checkout on one side and featured items on the other. Another incentive for using this strategy in online stores is motivating shoppers to add a few more items to their basket so they can meet the minimum requirements for free shipping, if offered.

Principle 5. Cross-sell low-margin items with high-value items.

Department-store retailers understand shopping psychology and know that buyers aren’t nearly as likely to act on impulse when it comes to higher-priced items. Therefore, they place lower-priced items in high-traffic areas in anticipation of drawing the customer deeper into the store and closer to higher-value items. Retailers also make a smooth transition between the two by sporadically placing a high-value item amid low-margin ones at the front and gradually increasing its appearance.

 
To transfer this strategy to online stores, retailers can research high-traffic areas on their site—landing pages are the most obvious example—and strategically place items they need to sell in these areas. Another way to use this concept is to place a “suggestion row” underneath a shopper’s current selection, with the idea of showing how two items work together so the customer will be more likely to pick up both.

 Although online and offline stores vary in their marketing and merchandising strategies, they actually have a lot more in common than what appears at first glance. By implementing the five key principles that in-store retailers use, their online counterparts can appeal to shoppers more efficiently and strategically. Take time to visit bricks-and-mortar stores regularly to see how they implement these principles, and adopt them in your online store accordingly. Some will work and some won’t, but never be afraid to try something new. After all, the most successful online stores are those that learned from the hits and misses of offline stores.