Passion for Retail Shelf Management Insights

1 Copyright © Bruegmann USA INC, 2014

The Last Three Feet of Shopper Marketing

The shelf is one of the most important, yet least appreciated, Shopper Marketing tools.

Shelf Organization and Purchase

Shopper marketing initiatives implemented by most retailers and brand companies place their

emphasis on the strategic aspects (e.g. shopper segmentation, in-store communication, creative

development and consumer sales promotions). But there is one area that can make or break a

shopper marketing campaign, the shelf!

With an increasing number of purchases decided in-store and many purchase and brand-switching

decisions taking place at the last three feet of the path to purchase, the shelf is a very important

aspect of shopper marketing. Certain shelf management tools can ensure that “shoppers” convert

to “buyers.”

Brand switching has become more prevalent

inside the store. Since 1977, the percentage of

unplanned purchases has increased sharply,

whereas the percentage of specifically planned

purchases has dropped.

(Source: Point-of-Purchase Advertising Institute

[POPAI] 2012 Shopper Engagement Study)

A study by TNS (‘Stop Interrupting Shoppers’) revealed:

Shoppers generally spend the vast majority of their time

in a category at the shelf searching for the product they

planned to buy, and during that time cannot be

influenced for any other purchasing opportunities.

Shoppers who find their first item quickly are more likely

to buy additional items from the same category.

Shoppers who find the first product within 10 seconds

tend to buy 1.5 more items.

When initial brand or purchasing needs are satisfied,

shoppers are open to explore other product options.

This research clearly demonstrates the importance the shelf plays as an integral part of the shopper

marketing mix.

Passion for Retail Shelf Management Insights


Shopper Marketing Platforms and Tools

Booz & Company (Shopper Marketing Study, 2010) identified seven shopper marketing platforms

and 49 shopper marketing vehicles. Interestingly, there is no reference to shelf management or

organization in spite of the fact that shelves play an integral and essential role as a retail tool.

Without shelves and shelf management tools there is no viable retail space!

A shelf that is not perfectly stocked, organized, fronted and maintained impacts and reduces the

ROI of any shopper marketing effort. Imagine a great out-of-store campaign for a new product that

creates demand that drives traffic to the store, but then the product is not visible or out of reach due

to a disorganized or badly merchandized shelf.

The worst examples of a badly maintained shelf are:

“Out-of-stock.” If the product is not on the shelf, sales and profits are lost, a situation

dreaded by retailers and manufacturers.

“Perceived out-of-stock.” Products are on the shelf but cannot be seen by the shopper (not

fronted or hidden from view), again causing lost sales and profits.

Shopper perception, which is driving store image, is just as important as stock, sales and profits

when it comes to retail shelves and stores. When we asked shoppers to tell us what they don’t like

about disorganized shelves they replied:

“A disorganized shelf is just not inviting and appealing”

“It is difficult to find products”

“I don’t like shopping in that aisle”

“I do not have the time and patience to figure out the shelf when it is not well presented”


A disorganized, “shopped down” shelf is uninviting. No consumer wants to shop there. Shelves in

this condition shed a bad light on the overall image of the retailer and the brands.

Shelf management systems keep products at the shelf edge at all times. This makes shopping easy

for customers and saves retailers time and costs by eliminating fronting, reducing restocking time

and keeping the shelf well organized. The shelf is fronted to the last unit!

Shopper Marketing Principles Shopper marketing is not a new discipline. The common “golden thread” in the development of the

concepts is that the shelf plays an integral role in every case from the very beginning. Here are

some examples of the development.

Coca-Cola – “Within an arm’s reach of desire”

Robert Woodruff, former chairman of The Coca-Cola Company stated in 1923, that a Coca-Cola

product should always be “Within an arm's reach of desire.” With that statement, global marketing

was born. The Coca-Cola Company started to place

its products on every shelf and in every cooler

available.

Today, the company has placed millions of coolers in

stores and other locations around the world. The

activation of placing the products was summarized in

a one-word strategy: Availability!

Procter & Gamble – “The first and second moment of truth”

Procter & Gamble’s CEO, AG Lafley said: “The first moment of truth is when the consumer makes

the decision to buy a product” – usually within three to seven seconds. This moment of truth is

considered the more important marketing opportunity for a brand. The second moment of truth

occurs when the consumer uses the product.”

In fact, Lafley’s statement began the questioning of significant investments on above-the-line (out of

home) marketing efforts because media programs lack a direct connection to the first moment of

truth and the conditions that surround it. Again, that makes the shelf the key tool in this enduring,

timeless shopper marketing principle.


Google – “The zero moment of truth”

The zero moment of truth influences:

Which brands make the shopping list

Where shoppers choose to buy

With whom shoppers share the results

This concept is about how consumers gather

information before they get to the store or buy on

the Internet. Even so, at the end of the purchase

decision is the shelf, whether it is a physical shelf

in-store or a virtual shelf on the Internet. The

principles are the same: Products that are easy

to find, well organized and have good visibility.

IMC - Integrated Marketing Communication

IMC is the development of marketing strategies and creative

campaigns that weave together multiple marketing disciplines

(advertising, public relations, promotion, website, in-store

activation, social media, etc.). These myriad marketing

channels are focused on a common target and executed to

suit the particular goals of the brand. With IMC, the marketing

leverages each communication channel's intrinsic strengths to

achieve a greater impact together than each channel could

achieve individually. Again, the store and the shelf are key

components in any integrated marketing campaign.

Shelf Management Tools The main objective of shelf management tools is to make the shelf easy, fast and convenient for

consumers to shop. The key is to help shoppers find what they are looking for so that they have

additional time to spend on browsing and shopping for additional items. Because the benefits of the

best shelf management systems are of key importance for retailers and brand manufacturers, they

need to collaborate to obtain:

Labor Savings

Reduces restocking time

Eliminates fronting time Improved Visual Presentation

Increases sales by making it easier for shoppers to locate merchandise Theft Deterrence

Reduces shrinkage by minimizing the ability to sweep shelves Simple/Quick installation

Changes to planograms (POG) are executed easily and quickly without tools


The main tools to achieve a well-maintained and organized shelf are:

Fronting systems – Pusher systems and roller shelves

Pusher systems work well on flat shelves where vertical space is limited. Roller shelves are the

optimum system when there is enough vertical space for angled shelves.

Organization systems – Dividers, trays and front rails

These tools keep products organized and aligned by facings, ensuring POG compliance. They can

be used alone on a flat shelf or in combination with pushers and roller shelves.

Communication systems – Shelf strips, price label holders and signage

Because these systems have been around for many years, they are often easily forgotten or taken

for granted. But the important benefits of these systems include:

Showcases new products or special offers

Maintains POG compliance

Ensures accurate pricing of product

Manages category packout – using different color inserts

Increases operational efficiency for inventory control and restocking


Loss prevention systems – Lock boxes, pusher systems and audio devices on doors

Retailers are taking a proactive approach to combat shrinkage by

implementing on-shelf systems (among others) that deter or

prevent shoplifting. These on-shelf quality solutions do not interfere

with shopping. Introducing a two-handed shopping process has

proven to be successful in all channels by protecting retailer margin

and profit.

Conclusions

Shelf management systems are important shopper marketing tools because they ensure that

products and brands are well presented to the shopper at the point-of-purchase decision.

A disorganized shelf creates a less than optimum shopping experience for the consumer, which has

a dramatic impact on sales and retailer profits in any category.

A well-stocked and organized shelf provides a range of benefits, which deliver increased sales and

labor cost savings. This makes the investment in shelf management equipment affordable.

Consumer Benefits

Increased product visibility

Enhanced shoppability – easier to locate

products

Increased impulse purchases – shoppers see

and buy additional products

Retailer Benefits

Labor savings – retailer staff spends less time

maintaining the shelf – no more fronting every

lane in key categories.

Easier to identify out-of-stock situation

Staff spends time on more profitable in-store

duties – servicing the customers!

Efficient planogram changes are easily

executed

Brand Manufacturer Benefits

Fronted product always available for a sale

Supported brand equity in the category

Maintained positive space-to-sales ratio for

continued shelf allocation

Changes to planogram are easy to implement

Consumer

Enhanced Shoppability

Brand

Better Visibility

Retailer

Labor Savings

ROI


Shelf management equipment is often overlooked based on costs to implement. Empirical research

data proves that, in key categories, the return on investment is as low as six to eight months. The

major benefit of investing in quality equipment is that it will perform beyond expectation and deliver

ongoing positive results. There is no doubt that shelf management and organization is an essential

aspect of retailer, category and brand sales, as well as labor cost savings and profit success.

In summary, shelf management systems keep products at the shelf edge at all times. This makes

shopping easy for customers and saves retailers time and costs by eliminating fronting, reducing

restocking time and keeping the shelf well organized. The shelf is fronted to the last unit!

Retail case studies prove that a well-merchandised shelf drives additional sales.

If shoppers see it and find it, they buy it!

The shelf can make or break a shopper marketing campaign!

For more information please contact:

Joel Linton

Business Development

Bruegmann USA Inc.

Tel: +1 888 745 9229

Mobile: +1 832 452 7348

Email: [email protected]

mailto:[email protected]

Passion for Retail Shelf Management Insights

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