Cross Merchandising: An Effective Marketing Strategy
Experiencing a slack in business? Perhaps you need to practice cross merchandising. It is an effective marketing strategy that can help your sales shoot through the roof. Read more about cross merchandising here.
It is an example of cross merchandising, where well-known brands join hands with another popular brand, to offer super-branded products or services.
Supermarkets have taken shopping to a whole new level. Everything you need, and more that you don't need, is available in the supermarkets today. And supermarkets, with their clever use of cross merchandising, ensure that you rack up a huge bill, even though all you entered the supermarket for was a packet of tissues.
Cross merchandising is nothing but a clever display of closely related products from different categories, that encourages the customer to purchase all of them. In turn, it also lifts up the sale of products from different categories.
Cross merchandising can be done by displaying the products on a mannequin, or by actual positioning of merchandise on racks or shelves. In this story, learn more about the concept of cross merchandising, in case you are thinking of employing it in your store, or just to show you how supermarkets manage to make you spend more than you intended to.
Before you think of employing the strategy of cross merchandising in your business, consider the following points:
Products must have a logical connection between them
For cross merchandising, the merchandise must naturally go well or complement each other. The customers should be able to relate them together. I'll elaborate this point with a few examples:
✜ A shoe retailer can benefit by displaying socks, shoe shiners, shoe insoles, laces, and odor-controlling foot creams and powders together.
✜ If a retail store houses electrical appliances, like mobiles and laptops, then displaying accessories, such as mobile cases, laptop bags, headphones, memory cards, audio and video CD's, etc., may help increase the sale of accessories.
✜ For men clothing retail outlets, accessories like ties, cuff links, belts, and perfumes do the trick, whereas with woman's clothing, fashion jewelry, handbags, sunglasses, perfumes, etc., could be displayed.
✜ For nurseries, displaying fertilizers, gardening gloves, and decorative pots next to the plants will help increase sales.
✜ Chips or any other salted snacks, if kept next to soda, soft drinks, or liquor, may boost the sales of both items.
✜ Pairing ice creams with sweet sauces, like chocolate or strawberry, are a great way to increase the sale of sauces.
✜ Mayonnaise, salted sauces, and salad dressings could be kept next to the fresh produce of fruits and vegetables.
✜ Breakfast cereals could be bundled up with packaged milk, and fruit and vegetable juices, to create an image of a complete breakfast.
✜ Utensils pair well with cereals and pulses.
✜ Gifts, soft toys, and stationery usually go well together.
So, now do you know why mannequins are decked up in a full ensemble, complete with a scarf, sunglasses, a handbag, and matching jewelry, instead of just plain clothing? It is done to make you look at the complete picture, and induce the desire to make you buy all the stuff to recreate the same look on you.
Strategic Placing is Very Important
In case of a stand-alone retail outlet, the owner should make it a point to place the items in a way that would make spotting and buying the related products easier. Cross merchandising will bear results only if the customer spots the related items.
If everything is just kept haphazardly without any logical sequence, the customer will not be able to differentiate, and the shop may lose a sale. Make proper sections, and keep the related products together. Even if you group things together, the overall appearance should be neat and uncluttered.
For supermarkets, the gondola ends/end caps could be a great location for cross merchandising. These are easily visible and also do not stand in the way. At the billing counters or checkouts, small racks could be placed that could display the 'on-the-go-pick-me-ups' like candy, chocolates, and mouth fresheners, crossed with daily essentials like scissors, nail clippers, and clothespins.
The entry point of the supermarket could be used for cross merchandising. The entry area is an important area from the point of view of sales, because whenever customers enter, they are very enthusiastic to start shopping.
Slowly, they lose enthusiasm, and by the time they reach the last aisle, they run out on enthusiasm as well as cross their set budget. Cross merchandising could also be done in the middle of the aisles, but the products should be placed very cleverly. Otherwise it would just result in nuisance and clutter that would hardly generate any sale.
Cross merchandise according to...
The season of cold and flu would mean more cough drops, cough syrups, inhalers, tissue paper, and other medicines. Pharmacies could stock up on these and display them together. The summer season is all about soaking in the sun. Therefore, cloth retailers would benefit by stocking up on beach wear and displaying them on a mannequin.
All closely related items, like a swimsuit, hat, sunglasses, sarongs, flip-flops, and umbrellas could be put together and displayed on the mannequin. Associated products like sunscreen, moisturizers, and fragrances can also be shown in the vicinity.
If the location of the store is in an area that is upbeat and youthful, there is no point displaying products that are drab. If it is a pharmacy, displaying diabetes care products won't help; instead, weight loss products would generate more sales.
By the word season, I imply the holiday season or the sports season. Apart from the usual Memorial Day, 4th of July, Labor Day, Thanksgiving, Halloween, Christmas, and New Year's, there are various other seasons like soccer or cricket season. These 'shoulder seasons' also provide the opportunity to cross merchandise successfully.
This is type of cross merchandising strategy in which one famous brand teams up with another well-known brand, to deliver a product or service that is ultra-luxurious.
For example, Apple joined hands with BMW, and put forth an integrated adapter, that seamlessly integrates the iPod with the automobile's audio system. United Airlines replaced the mediocre coffee that it was serving to the passengers with Starbucks coffee, and upgraded its image by leaps and bounds.
The main motive behind the branded brand strategy is not competing, but getting mutually benefited by each others popularity. Starbucks is getting exposure by serving thousands of passengers every day, and, in turn, United Airlines enjoys the affluence that the coffee brand generates for it.
Using this strategy, lesser-known premium brands try to enter new markets by getting tagged along with other famous brands. But both the brands should have natural synergy. For example, Aveda beauty products paired itself with Westin hotels, which means if you book a room at one of the Westin hotels, you will find the toiletries of the brand 'Aveda'.
The Italian luxury brand 'Bulgari' paired with hotel giant 'Marriot' to open a chain of super-luxurious hotels and resorts. The aim of these hotels is to provide only the finest; be it clothes, food, ambiance, people around, or lifestyle. Only the extremely rich can afford such an experience.
One aspect that hampers the effective implementation of cross merchandising is that consumers are looking out for solutions and not products, and the sellers are selling products and not solutions. If this is overcome, cross merchandising can really prove to be an effective marketing strategy.