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Store Layout, Design,
and Visual
Merchandising
Retailing
Management 8e
McGraw-Hill/Irwin
-1
© 2012
by The McGraw-Hill Companies, Inc. All rights17
reserved.
© The McGraw-Hill Companies,Copyright
All rights
reserved.
Store Management
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Managing the Store
Store Layout, Design, and Visual Merchandising
Customer Service
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Questions
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• What are the critical issues retailers consider in designing a store?
• What are the advantages and disadvantages of alternative store
layouts?
• How is store floor space assigned to merchandise departments
and categories?
• What are the consideration in where to display products in a
category?
• What are the best techniques for merchandise presentation?
• How can retailers create a more appealing shopping experience?
• How exciting should a store environment be?
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Store Design Objectives
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• Implement Retailer’s strategy
• Build Loyalty
• Increase Sales on Visits
• Control Cost
• Legal Considerations—Americans with Disabilities Act
• Design Trade-Offs
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Store Design and Retail Strategy
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The primary objective of store design is implementing the retailer’s strategy
(c) Brand X Pictures/PunchStock
Meets needs of target market
Builds a sustainable competitive advantage
Displays the store’s image
C. Borland/PhotoLink/Getty Images
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McDonald’s remodeled its stores to better appeal to European customers
Retailing Management
Retailing
Retailing
8e
Management,
Management,
© The
8/e McGraw-Hill©Companies,
©
The
The
McGraw-Hill
McGraw-Hill
All rights
Companies,
Companies,
reserved. All
Allrights
rightsreserved.
reserved.
171 - 6
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In India, a retailer finds key to success is clutter
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Build Loyalty
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• Store design provides utilitarian benefits when it
enables customers to locate and purchase products in an
efficient and timely manner with minimum hassle
• Store design provides hedonic benefits by offering
customers an entertaining and enjoyable shopping
experience.
H. Wiesenhofer/PhotoLink/Getty Images
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Increase Sales on Visits
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• Store design has a substantial effect on which products
customers buy, how long they stay in the store, and how
much they spend during a visit.
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Control Cost
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• Control the cost of implementing the store design and
maintain the store’s appearance
• Store design influences
• Shopping experience and thus sales
• Labor costs
• Inventory shrinkage
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Legal Considerations
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• Americans with Disabilities Act (ADA)
• Protects people with disabilities from discrimination in
employment, transportation, public accommodations,
telecommunications and activities of state and local
government
• Affects store design as disabled people need
“reasonable access” to merchandise and services built
before 1993. After 1993, stores are expected to be
fully accessible.
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Reasonable Access
What does that mean?
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• 32 inch wide pathways on the
main aisle and to the bathroom,
fitting rooms elevators and
around most fixtures
• Lower most cash wraps and
fixtures so they can be reached
by a person in a wheelchair
• Make bathroom and fitting room
fully accessible
Keith Brofsky/Getty Images
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Ease of locating
merchandise for
planned purchases
Royalty-Free/CORBIS
Giving customers
adequate space to
shop
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(c) image100/PunchStock
Design Trade-Offs
Exploration of store,
impulse purchases
Productivity of using
this scarce resource
for merchandise
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Store Design Elements
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• Layouts
• Signage and Graphics
• Feature Area
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Store Layouts
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• To encourage customer exploration and help customers
move through the stores
• Use a layout that facilitates a specific traffic pattern
• Provide interesting design elements
• Types of Store Layouts
• Grid
• Racetrack
• Free Form
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Grid Layout
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• Easy to locate merchandise
• Does not encourage customers
to explore store
• Limited site lines to merchandise
• Allows more merchandise
to be displayed
• Cost efficient
• Used in grocery, discount,
and drug stores: Why?
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Racetrack Layout (Loop)
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• Loop with a major aisle that has access to departments
• Draws customers around the store
• Provide different viewing angles and encourage
exploration, impulse buying
• Used in department stores
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JCPenney Racetrack Layout
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Free-Form (Boutique) Layout
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• Fixtures and aisles arranged
asymmetrically
• Provides an intimate, relaxing environment
that facilitates shopping and browsing
• Pleasant relaxing ambiance doesn’t come
cheap – small store experience
• Inefficient use of space
• More susceptible to shoplifting –
salespeople can not view adjacent spaces.
• Used in specialty stores and upscale
department stores
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Usage of Signage and Graphics
•
•
•
•
•
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Location – identifies the location of merchandise and guides customers
Category Signage – identifies types of products and located near the goods
Promotional Signage – relates to specific offers – sometimes in windows
Point of sale – near merchandise with prices and product information
Lifestyle images – creates moods that encourage customers to shop
H & M effectively uses graphic
photo panels to add
personality, beauty, and
romance to its store’s image
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Suggestions
for Effectively Using Signage
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• Coordinate signage to store’s
image
• Use appropriate type faces on
signs
• Inform customers
• Use them as props
• Keep them fresh
• Limit the text on signs
• Use appropriate typefaces on
signs
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Digital Signage
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Visual Content delivered digitally through a centrally managed and
controlled network and displayed on a TV monitor or flat panel
screen
• Superior in attracting attention
• Enhances store environment
• Provides appealing atmosphere
• Overcomes time-to-message hurdle
• Messages can target demographics
• Eliminates costs with printing, distribution and installing
traditional signage
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Feature Areas
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• Areas within a store designed to get
the customers’ attention
• Feature areas
• Entrances
• Freestanding displays
• Cash wraps (POP counters, checkout
areas)
• End caps
• Promotional aisles
• Walls
• Windows
• Fitting rooms
PhotoLink/Getty Images
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Space Management
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• The space within stores and
on the stores’ shelves are
fixtures is a scarce resource
• The allocation of store space
to merchandise categories
and brands
• The location of departments
or merchandise categories in
the store
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Space Planning
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• Productivity of allocated
space (sales per square foot,
sales per linear foot)
• Merchandise inventory
turnover
• Impact on store sales
• Display needs for the
merchandise
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Prime Locations for Merchandise
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• Highly trafficked areas
• Store entrances
• Near checkout counter
• Highly visible areas
• End aisle
• Displays
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Location of Merchandise Categories
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• Impulse merchandise – near heavily trafficked areas
• Demand/Destination merchandise – back left-hand
corner of the store
• Special merchandise – lightly trafficked areas (glass
pieces, women’s lingerie)
• Adjacencies – cluster complimentary merchandise next
to each other
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Location of Merchandise within a
Category: The Use of Planograms
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• Supermarkets and drug stores place private-label brands to the right of
national brands – shoppers read from left to right (higher priced national
brands first and see the lower-priced private-label item)
• Planogram: a diagram that shows how and where specific SKUs should be
placed on retail selves or displays to increase customer purchases
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Learning customers’ movements and
decision-making
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• Videotaping Consumers
• Learn customers’ movements, where they pause or move
quickly, or where there is congestion
• Evaluate the layout, merchandise placement, promotion
• Virtual Store Software
• Learn the best place
to merchandise and
test how customers
react to new products
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Visual Merchandising: Fixtures
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A. Straight rack
B. Rounder (bulk
fixture, capacity
fixture)
C. Four-way fixture
(feature fixture)
D. Gondolas
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Straight Rack
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Royalty-Free/CORBIS
• Holds a lot of apparel
• Hard to feature specific styles and
colors
• Found often in discount and offprice stores
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Rounder
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• Smaller than straight
rack
• Holds a maximum
amount of merchandise
• Easy to move around
• Customers can’t get
frontal view of
merchandise
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Four-Way
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• Holds large amount of
merchandise
• Allows customers to
view entire garment
• Hard to maintain
because of styles and
colors
• Fashion oriented
apparel retailer
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Gondolas
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• Versatile
• Grocery and discount stores
• Some department stores
• Hard to view apparel as they
are folded
Royalty-Free/CORBIS
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Merchandise Presentation Techniques
•
•
•
•
•
•
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Idea-Oriented Presentation
Style/Item Presentation
Color Organization
Price Lining
Vertical Merchandising
Tonnage Merchandising
• large quantities of merchandise
displayed together
• Frontal Presentation
• display as much of the product as
possible to catch the customer’s eye
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Idea-Orientation Presentation
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• Present merchandise
based on a specific idea or
the image of the store
• Encourage multiple
complementary purchases
• Women’s fashion
• Furniture combined in room
settings
• Sony Style mini-living rooms
Fifty percent of women get their ideas for clothes from store displays or
window shopping
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Creating an Appealing Store Atmosphere
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The design of an environment through visual
communications, lighting, colors, music, and scent to
stimulate customers’ perceptual and emotional responses
and ultimately to affect their purchase behavior
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Lighting
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• Highlight merchandise
• Structure space and capture a mood
• Energy efficient lighting
• Downplay features
The McGraw-Hill Companies, Inc./Lars A. Niki, photographer
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Color
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• Warm colors (red, gold,
yellow) produce emotional,
vibrant, hot, and active
responses
• Cool colors (white, blue,
green) have a peaceful,
gentle, calming effect
• Culturally bounded
• French-Canadians – respond
more to warm colors
• Anglo-Canadians – respond more
to cool colors
The McGraw-Hill Companies, Inc./Lars Niki, photographer
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Music
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• Control the pace of store traffic, create an image, and
attract or direct consumers’ attention
• A mix of classical or soothing music encourage shoppers
• to slow down, relax, and take a good look at the
merchandise
• thus to stay longer and purchase more
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Music
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• J.C. Penney – different music at different times of the day
• Jazzy music in the morning for older shoppers
• Adult contemporary music in the afternoon for 35-40
year old shoppers
• U.S. firm Muzak supplies 400,000 shops, restaurants,
and hotels with songs tailed to reflect their identity
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Scent
• Has a positive impact on
impulse buying behavior
and customer satisfaction
• Scents that are neutral
produce better
perceptions of the store
than no scent
• Customers in scented
stores think they spent less
time in the store than
subjects in unscented
stores
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The McGraw-Hill Companies, Inc./Gary He, photographer
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How Exciting Should a Store Be?
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• Depends on the Customer’s Shopping Goals
• Task-completion:
• a simple atmosphere with slow music, dimmer lighting, and
blue/green colors
• Fun:
• an exciting atmosphere with fast music, bright lighting, and
red/yellow colors
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Web Site Design
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• Simplicity Matters
• Getting Around – Easy Navigation
• Let Them See It
• Example: Lands’ End My Virtual Model
• Blend the Web Site with the Store
• Prioritize
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Web Site Design
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• Type of Layout
• When shopping on the Web, customer are interested
in speed, convenience, ease of navigation, not
necessarily fancy graphics
• Checkout
• Make the process clear and appear simple
• Enclose the checkout process
• Make the process navigable without loss of information
• Reinforce trust in the checkout process
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Keywords
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• shrinkage An inventory reduction that is caused by shoplifting by employees or
customers, by merchandise being misplaced or damaged, or by poor
bookkeeping.
• sales per linear foot A measure of space productivity used when most
merchandise is displayed on multiple shelves of long gondolas, such as in
grocery stores.
• sales per square foot A measure of space productivity used by most retailers
since rent and land purchases are assessed on a per-square-foot basis.
• impulse merchandise Products that are purchased by customers without prior
plans. These products are almost always located near the front of the store,
where they’re seen by everyone and may actually draw people into the store.
• demand/destination area Department or area in a store in which demand for
the products or services offered is created before customers get to their
destination.
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