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In-Store “Real Estate Values”….Much to be Learned

Colleague and shopping pundit, Herb Sorensen (www.shopperscientist.com), will tell you without hesitation that there is much to be gained by enhancing store layouts, particularly those that impede fluid shopper mobility within the store. As just one example, we known from past studies on the topic that the more aisles and barriers a store has, the

Shoppers are Changing, but Our Stores …Not so Much

The deliberate, time rich shopper of the past, to whom we market our stores, no longer exists. Quite the contrary, generally speaking, shoppers are time starved, distracted, and in some cases just flat out annoyed when they enter our stores. This new shopper increasingly finds ways to short-circuit the store plan, finding their items and

Business Wire: Electronic Shelf Labels Revenues to Reach US$2 Billion by 2019, According to ABI Research

Electronic Shelf Labels Revenues to Reach US$2 Billion by 2019, According to ABI Research – Business Wire LONDON–(BUSINESS WIRE)–Over the next 5 years Electronic shelf labels (ESL) are set to grow beyond retail markets in legislated countries, with revenues increasing six fold to almost US$2 billion by 2019. In its latest report, “Next Gen Retail:

In-Store “Real Estate Values”….Much to be Learned

Colleague and shopping pundit, Herb Sorensen (www.shopperscientist.com), will tell you without hesitation that there is much to be gained by enhancing store layouts, particularly those that impede fluid shopper mobility within the store. As just one example, we known from past studies on the topic that the more aisles and barriers a store has, the slower the pace of shopper spending. This is particularly important when coupled with the knowledge that shoppers do not have an infinite amount of time to navigate through a store.

In fact, after a few minutes into the trip, shoppers consistently speed up their pace, and accordingly decrease the rate in which they buy, speeding by aisles and categories that appear to be irrelevant to the shopper’s immediate needs or more commonly just represent too much time and energy to explore.

Most retailers are oblivious to these shopping tendencies. In fact they design and stock their stores with the mindset that more aisles and products mean more sales opportunities. It is just a matter of manipulating the shopper into spending more time in the store to take advantage of all of these great new products and departments. Nothing is further from the truth.

Retailers who have taken the time to track their shoppers through the store…whether it be by personal observation or by technical means, are often surprised by many of the discoveries, including the following:

1. How deep into the shopping trip, aka how long it takes for the shopper to select their first item for purchase from the time they enter the store.

2. The miniscule percentage of time shoppers actually spend “shopping” as opposed to the time they spend traversing the store getting from one “shopping event” to the next.

3. How little of the physical store shoppers actually traverse on any given shopping trip.

4. How few aisles shoppers actually fully navigate as opposed to “diving into an aisle” quickly for a planned purchase and then revert quickly back to the perimeter of the store.

5. How shoppers migrate naturally to open space, where they can clearly view the entire store, and conversely how consistently shoppers avoid tight, confining alcoves and aisles

Each of the aforementioned shopping tendencies represent opportunities for the retailer to embrace. By understanding these consumer practices, retailers can make both subtle and overt changes to their layout and merchandising plan, resulting in a more efficient shopping experience for the consumer and larger baskets sizes for the retailer.

 

 

Mark Heckman– Trius Co-Founder

Shoppers are Changing, but Our Stores …Not so Much

The deliberate, time rich shopper of the past, to whom we market our stores, no longer exists. Quite the contrary, generally speaking, shoppers are time starved, distracted, and in some cases just flat out annoyed when they enter our stores. This new shopper increasingly finds ways to short-circuit the store plan, finding their items and moving on as quickly as possible, despite the retailer’s best efforts to induce the shopper into a long and deliberate visit.

Shoppers are trying to tell us something!

To amplify my point, there exists quantitative research in abundance supporting the notion that bricks and mortar stores are rapidly alienating themselves from the evolving shopper. Among several notable KPI’s (Key Performance Indicators), such as Dollars per Square Foot, Same Store Sales and Customer Counts are trending in the wrong direction for all except the very few that have strategically embraced the new shopping paradigm.

Dr. Herb Sorensen, who I consider the very best source of empirical knowledge on consumer shopping behavior, stated in one of his recent publications that the relatively short time the shopper spends in a retail store is mostly devoted to moving from point “A” to point “B” and not engaged with actual shopping at all. This is particularly true in larger foot print stores of 50,000 square feet and more. In fact, only twenty percent of the entire shopping trip involves the shopper facing the shelf and engaging in the purchasing process.

The implications of this information are profound. Retailers and their marketing partners spend annually $275 billion in the U.S. on advertising, marketing, and promotion initiatives. These monies generally are regarded as less than efficiently spent, due to a variety of reasons, but chief among them is that those funds are not reaching the shopper effectively at the shelf, when and where the majority of purchased decisions are made.

Retailers and brands alike now have access to new research techniques and resulting data that can help them re-think how they lay out their stores and categories. Ultimately, each retailer should have a Visual Strategy for its bricks and mortar stores. Much the same way a web designer uses Google Analytics to build and fine tune an efficient website, physical stores must be approached in the same way.

Business Wire: Electronic Shelf Labels Revenues to Reach US$2 Billion by 2019, According to ABI Research

IndustryArts1bannerElectronic Shelf Labels Revenues to Reach US$2 Billion by 2019, According to ABI Research

– Business Wire

BusinessWireLONDON–(BUSINESS WIRE)–Over the next 5 years Electronic shelf labels (ESL) are set to grow beyond retail markets in legislated countries, with revenues increasing six fold to almost US$2 billion by 2019.

In its latest report, “Next Gen Retail: Electronic Shelf Labels”, ABI Research outlines how ESLs will be a key link in the retail technology chain, representing a great starting point when NFC or BLE is integrated. Retailer’s attention has been caught by other technologies, but the ideal scenario and end game for most will be a tightly integrated system that consists of ESL, smartphone applications, BLE beacons, indoor location, mobile payments, digital coupons/loyalty, customer analytics, and omnichannel marketing and pricing. ESLs are a perfect starting point, bringing a return on investment-based traditional brick and mortar bottlenecks, while also opening the door to next generation services and revenue opportunities.

Senior analyst Patrick Connolly commented, “ESL, in combination with NFC and/or BLE solves ongoing retailer issues like, out-of-stocks, check-out expenditure reduction, manual price coordination overheads elimination, inventory and store layout management, omnichannel consistency, and efficient price management of shrinkage/perishable goods, delivering an RoI within 18 months on these use cases alone. With integrated connectivity, it also brings future potential around dynamic pricing, positive showrooming, tightly integrated in-store advertising/redemption/loyalty, analytics, and pay-as-you-go shopping.”

“Dynamic pricing can be a controversial topic, but many of the arguments against are naïve or based on scenarios that are unlikely to occur in the brick and mortar space. The reality is it will give retailers far more control and flexibility, with the ability to reward loyal customers, dynamically match pricing to varying demand, while also meeting the needs of price sensitive customers,” added Connolly.

Pricer and SES are the two major players in this space today, dominating traditional markets. In particular, SES has shown very strong growth over the last 2 years, with the recent imagotag acquisition giving it new capabilities. Displaydata (backed by Zebra Technologies) and Samsung are the clear emerging threats, with Altierre also achieving some success in its native United States market. There are also a number of localized start-ups such as Hanshow in China that will make this a very interesting market over the next 5 years.

These findings are part of ABI Research’s Location Technologies Market Research (https://www.abiresearch.com/market-research/service/location-technologies/).

ABI Research provides in-depth analysis and quantitative forecasting of trends in global connectivity and other emerging technologies. From offices in North America, Europe and Asia, ABI Research’s worldwide team of experts advises thousands of decision makers through 70+ research and advisory services. Est. 1990. For more information visit www.abiresearch.com, or call +1.516.624.2500.