A New Era of Retailing
Supermarkets are renowned for their ability to persuade shoppers to part with their money – but are they risking being left on the shelf when it comes to displaying their goods?
New research has shown that supermarkets using a ‘complement-based’ display system – with goods needed for so-called ‘shopping missions’ or ‘events’ such as breakfasts, barbeques or dinner parties displayed in one place – saw a 17% increase in item sales compared to using a conventional store display.
Traditionally, supermarkets have used a ‘substitute-based’ display system, with different ranges of items such as biscuits, cleaning products and fruit and vegetables displayed in one aisle.
Together with colleagues from Manchester Business School, Athens University of Economics and Business and Babson College, we tracked sales in a major supermarket store before and after a complement-based display system was introduced.
When the complement-based system was introduced, the number of items in an average weekly purchase rose by 17% and the value of an average weekly purchase rose 9% over the 20 weeks.
The way that retailers display goods and the impact that this has on buying habits is a fundamental, but not particularly well-understood, part of retailing.
Some retailers already use both complement-based displays – Ikea displays goods typically found in a bedroom in one place, or those found in a kitchen in another, while Marks & Spencer displays everything for a dinner for two in its ‘Dine In’ menus – and substitute-based displays.
By comparing shopping habits in a supermarket before and after a complement-based system was introduced, direct comparisons can be drawn about which leads to higher sales.
By placing a variety of different goods in front of shoppers it becomes easier for them to ‘visualise’ the experience for which they are buying. Shoppers are reminded that they need to buy certain products or alerted to items of which they may not have thought. We also studied shopping habits in a separate store and online. In all cases, sales of goods were higher when a complement-based display system was used.
Retailers shouldn’t assume that introducing a complement-based display system will immediately boost sales and should think carefully before changing how goods are displayed.
If a shopper has carefully planned their supermarket trip, the impact of a complement-based display system may be limited as there is less scope for unplanned purchases.
Retailers also need to be mindful of the costs involved – rearranging stores involves significant investment, as well as disruption in-store. But reconfiguring how goods are displayed on a shop’s website is a good option. Our research shows that there was a significant increase in online sales when a complement-based display system
We expect that this type of display will become increasingly popular as retailers seek to increase or maintain their market share. It won’t happen overnight – shoppers have grown accustomed to supermarkets looking a certain way, and finding the items they want in certain places. But this complement-based system is the way the wind is blowing in a new era of retailing.
Find out more
‘The impact of complement-based assortment organisation on purchases’ by Panagiotis Sarantopoulos, Aris Theotokis, Katerina Pramatari and Anne Roggeveen is published in the Journal of Marketing Research, 56(3). A copy of the paper is available upon request: firstname.lastname@example.org