Research shows up to 70 percent of grocery purchasing decisions are made in-store, making your merchandising strategy key to increasing basket size. Amidst ever-increasing competition, a great way to do that is to make shoppers’ experience more efficient by placing items commonly purchased together near one another. "Typically, stores are laid out how retailers feel they work best, not how consumers can find items the easiest," says Venky Shankar, a marketing professor at Texas A&M University. "When shopping, they think in terms of events or activities such as Super Bowl Sunday, Valentine’s Day or even breakfast. If you find the right combinations and execute them well, cross-category merchandising is a win-win." Here are nine ways to nail this tactic.
Tell a story. When cross-category merchandising, there has to be a story going on, and it should all be locked together with a beautiful sign telling shoppers what’s going on, followed by a call to action. The message has to be inspirational and evoke excitement. In our industry, we’re never going to win on price, so if you’re not telling a story that wows guests, you’re missing an opportunity. Grocery shopping is a commodity, so make it fun, fresh and new and customers will love you for it.
Look for opportunities in produce. The produce section is where the initial shock value is for customers when they first walk into a store. So along with standard ideas like placing peelers next to vegetables, bring food products from other departments into produce. If tomatoes are in season and you want to tell a tomato-basil-mozzarella story, show some cheese, an oil, maybe some beautiful salts and even a pretty plate.
Capitalize on trends. We stress trends and always work hard to ensure our stores are very on-trend. As part of that, we make sure our displays and cross-category merchandising opportunities, which we put lots of money, energy and effort into, are in line with the latest trends. For example, we might promote a trendy popcorn and place pretty bowls next to it to encourage people to make this snack something nice.
—Eli Lesser-Goldsmith, owner of Healthy Living Market and Café in South Burlington, Vermont, and Saratoga Springs, New York
Know drivers from drivens. Certain items, such as salty snacks and carbonated beverages, have natural affinities because we tend to consume them together. Research shows that people who buy salty snacks will think of thirst and then grab beverages if they’re nearby. Interestingly, it doesn’t work the other way, even if snacks are right next to drinks. Learn which direction the category relationships work. Salty snacks are the driver because they drive sales of beverages, the driven. Place drivens close to drivers to boost sales of both.
Follow the two-aisle rule. When cross-category merchandising, think strategically about placement and display. Two aisles apart is the rule because that’s the extent of most shoppers’ peripheral vision. Beyond that, it’s very difficult to be effective.
Step up efforts around holidays. For special events, the rules change somewhat because products that don’t have natural affinities are no longer considered impulse buys. Analyze your data to understand purchasing habits around holidays and other occasions and then re-engineer your layout to reflect that. For example, in summer, chips, dips, plates and cups might make more sense near one another. Retailers sometimes say reconfiguring is too hard, but if you don’t do it, customers are more likely to leave with just one item.
—Venky Shankar, PhD, marketing professor and director of research at the Center for Retailing Studies at Texas A&M University
Mingle food and supplements. You likely have once-a-month supplement shoppers and once-a-week grocery shoppers. To convert those monthly customers to weekly, merchandise functional beverages, snacks and other grocery items near the supplements. You also want to get grocery shoppers buying higher-profit HABA products along with food. So on an endcap of kids’ snacks, place children’s vitamins. Put vitamin E or garlic capsules with heart-healthy meal items.
Milk multiple items for margin. If you have a display devoted to pasta meals and you’re putting the sauce on sale, keep everything else at full price so that you’re only giving away margin on one product. That way, you’ll hopefully get extra volume on the rest. A sale really works if you increase volume on three or four items, preferably at once, versus on one or two scattered around the store. In the short term, this is a great way to make up margin. In the long run, it reinforces to shoppers that you’re much closer to a one-stop shop than they may think.
Pick your partners’ brains. Brokers, distributors and manufacturers are great people to ask for cross-category merchandising ideas. Find out what they see working. Manufacturers may tell you what’s succeeding nationally while a distributor might give you regional info. Sometimes they will even offer special signage or help build endcaps.
—Bill Crawford, founder and principal consultant at Crawford Solutions in Tulsa, Oklahoma