BrainTrust Query: Do Messy Stores Sell More?
The more things
change, the more they stay the same. Stephanie Clifford of The New
York Times recently penned an interesting report entitled, Stuff
Piled in the Aisle? It’s There to Get You to Spend More, citing several chain
retailers that are making their stores messier with the objective of selling
more.
Ms. Clifford references Walmart’s well-documented switch from clean
aisles to "a little bit of mess" accompanied by the dismissal or
reassignment of "the top executives who came up with the cleaner-stores
plan." Other
examples given were Dollar General raising the height of their shelves, J.C.
Penney adding wall displays and Old Navy lining their checkout lanes with impulse
items. Dollar General supposedly increased sales per square foot to $201 in
2010 from $165 in 2007 with their increased shelf height and "speed bump" aisle
displays.
But all this is nothing new. Ms. Clifford, in fact, sees this as a
reversal from the leaner/meaner approach taken during the recession. "Stack
it high and watch it fly" was the famous mantra of Price Chopper and other
northeastern supermarkets in the ’70s and ’80s. The huge Waccamaw Pottery of
Myrtle Beach, SC is widely regarded as a very successful pioneer of both "discovery
shopping" (finding
must-have, limited-availability items on pallets around every corner) and the
big box format, also in the ’70s. During those decades it was common for supermarkets
to feature "paper drops," in which they bought boxcar-loads of bath
tissue and trucked dedicated semi-trailers around to their stores where cases
and cases of heavily-discounted product were stacked and sold from outside
the entrance to the store.
Dollar General’s increase in shelf height used to
be called "densing
up" in
the 90s when back rooms were built intentionally smaller to make selling floors
larger, direct-store-delivery (DSD) became more prevalent and the Japanese
practice of just-in-time delivery was widely adopted.
Ms. Clifford’s report
credits two "strategic reasons" for this clutter
movement. First: "After years of expansion, many retailers are halting
building plans and closing stores as sales and traffic shift to the web. That
means the main way to increase revenue is by selling more stuff at the existing
stores." And
second, "same-store sales are getting stronger, so retailers are adding
back merchandise." All of this, as Ben DiSanti of TPN retail marketing
consultants was quoted as saying, is because, "If you have the temptations
there, it will lead to additional sales."
Discussion Questions
Discussion Questions: Is there a “clutter trend” at retail? Do intentionally messy stores really increase sales as a direct result?
I don’t know if this is a trend but I do know that some retailers are better at clutter than others. I was in Chicago recently and visited a store that caters to mostly foreign customers such as southern Europeans, Hispanics, and Asians. The store was a mess. I could not see the logic behind some of the displays. However at $15 per square foot per week in sales, I’m not going to second guess management’s logic. If a generic sterile plain vanilla chain store such as Jewel or Dominick’s tried this I doubt it would have any success. Then again, look who is really successful in Chicago. It’s typically the stores that are anything but sterile.
Or maybe they’re putting spin on perception that their large format store concept is too overwhelming and, due to dating, are helping some vendors appear stronger than perhaps they truly are. Having more just to have more doesn’t increase profitability.
When I was in store design many years ago, we noticed a consistent phenomenon when stores were in the middle of renovation with stuff all over the place… sales went up!
There did seem to be some weird, inverse relationship between disarray and sales volume. I figured it must have been that the mess was a visual cue to consumers that something big was going on and that they should get in on it. A feeding frenzy sort of instinct.
In general however, I think the level of organization and tidiness of your store and stock is a branding decision. It depends on who you are as a business. I don’t think there’s any ironclad rule.
The key takeaway of this article is the “treasure hunt” desire of many shoppers. This phenomenon has created a USP for the club stores, creating a bit of adventure when shopping as an alternative to boring supermarket shopping trips.
However, I caution retailers not to confuse the “treasure hunt” option with “store clutter.” While some consumers like clutter (look in their basements or garages) in my research on the importance of various supermarket attributes, clutter-free stores ranked up there with price, quality, and service. Clutter free is more than store cleanliness (an imperative for a supermarket). It is a store that allows customers to navigate the aisles with ease, fully faced out shelves, helpful/readable signage, clean shopping carts, etc.
Yes, let’s make the stores more fun. However, remember most garages and basements are uncluttered and messy stores work for some but probably not most of the market. A niche, yes–a universal approach to the market, no.
What’s the mess convey to most? Bottom pricing I would guess. So, if that’s your mantra as a retailer then start piling it up and making it a mess.
That’s not everyone’s game though. So, let’s hope the local BMW and Mercedes dealerships don’t suddenly start operating out of unpaved parking lots with unwashed cars.
As a retailer, know who your customers are and what you stand for. Makes most decisions, including how to display your store, pretty easy.
It depends on the positioning of the store–or even the section of the store you are in. Two examples:
There are three major chains in Australia–Cole’s, Woolworth’s and Franklins. Cole’s is a combo food and department store–high-end and very smartly merchandised. Woolworth’s is a center of the road food chain, traditionally merchandised. Franklins is a European style hard discounter–and a complete mess. The store was merchandised this way on purpose to reinforce the low low price image, and it worked.
Cabela’s stores are impeccably merchandised. They make use of center aisle displays for specials, etc., but overall they are extremely organized. Until you go into the “Bargain Cave.” This dedicated section at the back of the store is for close-outs, returns and odds and ends merchandise. The reason to go there is to find a deal. And it is a complete mess.
Messy merchandising reinforces a bargain basement price image. That’s why Walmart needed to reinstate “Action Alley”–it needed to look low price, not just be low price.
I would not call this a clutter trend at all and in fact, if anything, retailers such as Walmart have learned how to add more SKUs without creating disarray. While we’re on the subject of Walmart, I think that they were smart to reduce clutter at the height of the recession. There is a school of thought that cluttered environments create emotional tension. During times of trial, clear the aisle!
I also don’t think that stack it high and let it fly is coming back. Instead, I would call it an evolution to “vertical” display. Vertical display is a natural evolution as retailers seek out smaller formats and it will in many cases be a companion to vertical architecture (multi-level stores that go up rather than sideways in order to tuck into urban settings).
Clutter to me signals a bargain. If you’re Walmart or a dollar store, I think it’s probably an ok strategy. However, if I walked into Nordstrom and found tables of merchandise to rummage through I would either be completely turned off, or expect a 70% discount for my trouble.
You can’t sell from an empty cart which is a lesson learned from SKU rationalization. But, swinging to the other extreme isn’t a profitable strategy either.
Smart retailers use different strokes for different folks. Mess projects bargains to some, targeted sterility appeals to others. Many consumers like a panoply of goods all over the store such as David described. On the other hand, Coach customers spend lavishly in clean-as-a-whistle stores.
Any one remember Gimbel’s budget store basements? When they had their special promotions on Saks Fifth Avenue merchandise transferred from upstairs, the basement floors in their Milwaukee, Pittsburgh, Philly, and Manhattan stores were stocked up to the ceiling, fancy shoes piled onto bargain tables, you name it, they dumped it, and it all flew out the door. Miller and Rhoades and others did the same.
Filene’s original basement store in Boston was cluttered and always full of bargain hunters, be they famous celebrity actors, millionaires, or just common folk. The messier the better.
It was the thrill of the hunt for that absolute bargain.
There is a significant difference between strategic placement of floor displays and clutter. We tell our clients that clutter is something customer walks around. Displays are something they walk by. What we see is if the space to get through is too small the number of people who shop that aisle drops.
There is little data in the article to suggest that adding clutter is better. The DG example ignores the fact that DG has been growing, presumably due to the economy, and not necessarily due to clutter. Empty space in a store that is not positioned at high-end does not make much sense, but cluttering up a store to make it look low end is probably not a good solution (unless you want it to be low end).
Organized clutter is the best approach to get the right results.
As a vendor who specializes in retail compliance, I find “messy” a poor and dangerous choice of word. To be sure, I looked up “messy” in Merriam-Webster and found the following definition: “marked by confusion, disorder, or dirt.”
While confusion and disorder could be arguably be intentional and “strategic,” I very much doubt dirt was an intended consequence. And there lies the problem with labeling any layout “messy.” It condones a dirty, unattended shelf. It is a slippery slope that implies a bazaar-like “anything goes” strategy.
If a retailer is going to experiment with less traditional shelf management strategies and displays, it really needs to define in very precise terms what is and isn’t permitted. A little bit of disorder may very well increase sales but too much could also undo the retailer’s best efforts and hurt the brand’s perception. Tread carefully, communicate clearly, measure relentlessly.
I am in agreement with most of the comments preceding mine. I would guess it is a matter of your personal preference and how one’s view of messiness relates to the purchases made. Personally, messiness indicates low price for certain. But is that what I went in the store for and will I return? That depends on the value of the perceived bargains. Discount malls and shopping centers seem to attract this style as does upgraded flea markets. The key word is they are generally successful operations.
I know a lot of retailers who would be a lot more profitable if clutter equaled sales. It’s obvious that your market position and selling strategy dictates the customer’s perception of a messy store. I agree that there isn’t any ironclad rule, but I am sure if the customer expects order and they get disorder, it will not result in higher sales.
This is a brand issue to me: works for Dollar Stores (and maybe Walmart), but does not work for Apple, etc.
As an example, I’ll never forget our first project with Target–as we walked through one of their stores getting a download, their sponsoring exec said to us, “see this aisle width and cleanliness?–sacred cow.” Got it.
So, it’s a ‘permission’ issue; what works for some customers, may not work for others.
“Stuff Piled in the Aisle? It’s There to Get You to Spend More…Americans like stuff. That’s a given. But it turns out that lots and lots of stuff piled onto shelves or stacked in the middle of store aisles can coax a shopper to buy more.”
My comment: This is really an atrocious viewpoint, widely promoted by the press and other faux-consumerist parties. But unfortunately deeply imbibed by many retailers as well. As if there is some kind of conflict between the interests of the shopper and the interests of the retailer and suppliers. As if people need “coaxing!” People go to the store because they want to buy stuff, and would gladly buy more if the PROCESS were not so painful, and they had confidence that they really were getting stuff that they will really want and appreciate when they get home. “Clutter” is a major part of the process problem. As if the business model of the local flea market is a serious option for a retailer that is already massively suppressing sales by failing to expedite the shopping PROCESS.
As I recall back in the late 90s or early 00s, one of the marketing journals had a study indicating that a more analytic thought process found more variety in an organized product set, while a more general approach to shopping found more variety when the display was a bit more cluttered.
I know I have a copy of that kicking around here somewhere.
Is it likely that customers may view clutter as offering more selection dependent upon factors–perceived value, product type, etc.?
I find myself allied with Mr. Peterson again! There is no one answer to the question as posed…it’s all about the brand.
I do believe there is a subtle signal given (and well received) by “piles” of merchandise that is not “in-line”. But if it strikes a dissonant chord with the consumer then it will repulse (think of the odd sensation created by someone playing the piano all on the black keys).
When your customer walks in your door they have expectations that have been set by your brand promise. If what they see and experience is consistent with that promise, then they hear a melody, sweet harmonies…music to their ears and eyes. If, on the other hand, they experience something that is identifiably not consistent with your promise, it is like the screeching of a poorly played violin.
I’m not even suggesting that certain brands cannot do it at all…I am only saying that the manner in which it’s done has to be consistent with the brand promise.
I was a store manager for a major woman’s apparel retail chain for 6 years and it used to be a joke with us that all we had to do to increase traffic was put a ladder up in the front of the store with some clothes hanging on it–people would come in to see what was going on.
Pile it high! This should be every stores mantra! This maximizes the storage capacity in a store, increases shelf choice (you only need a few items on the shelf and the rest are stacked above it), decreases costs and increases sales. What is there not to like? The warehouse stores have been doing this since their inception in the early 70’s and every store that takes on this approach decreases their costs and increases their sales revenue. What is there not to like???
Minds that are preconditioned by years of cheap space and sparse stocking tend to look at high-density environments as messy. However, higher merchandise density is not necessarily the equivalent of clutter. In some markets, contexts, or for some customer groups, high density is what works best.
For instance, I’ve seen many western retailers dismissively walk out of the “chaotic” stores run by India’s Future Group. And yet, that is the environment engineered by the company to help transition many customers, who would have been wary of large stores earlier, into modern retail. It has also aided its growth into the largest modern retailer. Having said that, as its customer base has shifted, Future has also created less densely stocked environments in some of the formats in selected markets.
So I guess, it’s horses-for-courses.
I throw shopping carts in the main aisles all the time with close-out deals, and seasonal stuff like 10 cent spiral notebooks from back to school. It is very effective, but you better have a great price on it, or it will just sit there, because consumers know the price of everything everywhere.
Cookies, chips, noodles, and many other items, can be dumped in with a great price, and it will sell fast!