I had the time to visit a few shops recently and one grabbed my attention – I thought it looked fantastic! The shelves were crammed with a plethora of brands and own label products – at a quick glance, it looked great. I’d never seen another retailer stocking four brands of bagels (plus own-label), three brands of milk – all from different dairies and literally a mountain of fresh bread. With the product range and provenance of those products on display it reminded me more of a posh deli like Dean & Deluca or Eataly in vibrant mid-town New York!
I was impressed – but as I began to look closer, a couple of things began to niggle in my mind…
Firstly, the retail pricing was confusing – for example, why was one brand of bagel more expensive than another – a sesame bagel is a sesame bagel right? The information available at the fixture and on the packaging did nothing to help understand the diverse prices at the shelf edge. I was confused – it was not obvious which brand was “better” than the other and why one commanded a higher price.
Secondly, there were out of stock products and gaps on the fixture – almost without exception, these were the core staple products – the best sellers. Most of these lines had one facing which clearly was insufficient to meet customer demand given the frequency of deliveries – or lack of it.
Thirdly, the fixture was mind bogglingly confusing compounded by a mass of brands, prices and mixed messages.
I watched for a while and saw that several customers paused at the fixture, but did not buy from it – it seemed that customers would rather walk away than invest the time (seconds!) to understand it and shop it. The old adage “Less is more” sprang to mind – by definition, this suggests that “simplicity is better than elaborate embellishment” or “something simple is better than something advanced or complicated.”
At 4C, we’ve been working closely with several major retailers and have guided them to develop simpler, clearer and more profitable product ranges. We’ve used the “less is more” concept as an overarching principle. We’ve implemented and followed the principles of category management using insight and data gathered from suppliers, the dashboards that we have introduced and our assessment of emerging customer trends, fads and fashions.
In one example, the number of products on the fixture was reduced by 10%, one brand was removed in its entirety and pricing was harmonised – qualitative feedback from customers suggested that “the fixture is easier to shop” / “I get the layout and know where to look for what I want”.
The financial results have also been impressive – the customer service level improved by 3% with fewer gaps and more space devoted to high volume lines. Sales rose by 4% and the overall % margin delivered rose by 1.5% because of selling a better product mix.