Seven Principles of Successful Online Merchandising Part 2

Great retailers only introduce product details once the visitor has expressed interest in the product. This is why, in a physical setting, pricing labels are so hard to find on garments. They want you to pick up and handle the product first, to feel it, to experience it on an essential level and fall in love with it – before revealing the cost.

This idea can be translated online as well. Once the visitor has expressed interest, then they are open to receiving detail, and the more the better: hi-def product shots, descriptions, videos, demonstrations, reviews – the works.

Remember, online retailers have to overcome two disadvantages compared to bricks and mortar.

• The first is that there are no sales associates on the floor to assist the customer and reassure them about their decisions.
• The second is that shoppers are unable to try and experience the product in the moment.

The way in which online retailers have an advantage, however, is that they control the web page and lay out as much information as possible, in as much detail as possible with the goal of helping the customer to imagine owning the product. They can also reassure the customer that if there are problems, customer service will make things right.

Price their products Fairly

The fifth principle of great online merchandising retail is that pricing is always relative. To sell anything at high volume, you need to price it fairly.

Customers are surprisingly well-informed about what things are worth. This is particularly true in a group buying context because it’s a discount channel, but for all retailers need to understand how price influences purchase.

It needs to be the best price on the market if you want it to perform. This doesn’t necessarily mean that the product has to be the cheapest. What it means is that for what you get, there are no cheaper alternatives.

The good news is that the brand owners get to determine what market they are in based on how they position themselves.

To price a product fairly, you need to understand what competition is out there and how unique your product is in comparison. The closer two products are, the more they must conform to the market price.

You should have an objective and balanced view of what sort of price premium your brand can command, which starts with 3 things:

• The attractiveness of each product (shopper-to-buyer conversion rate)
• Competitor pricing
• And how unique your product is compared to the nearest competitor product

Only then can you actually understand if customers truly value the brand as much as marketing wish they did.

Retailers that consistently deliver best in-market pricing are the ones that get a reputation for consistently meeting the customers needs and, in turn, are more able to create genuine customer loyalty.

Study visitor’s behaviour

The next principal of great online merchandising is that you should be observing the people who don’t buy the most.

Often times, merchandisers are blinded by survivorship bias. In other words, they focus on those who already transact, thinking that by better understanding customers, they can learn some insights into those that don’t purchase.

Just as it’s true that you can’t buy what you haven’t seen, it’s also true that customers never buy a product that they don’t want. Ever! Without exception. It doesn’t matter how engaging the website or how slick you design the checkout– none of those things will actually convince a customer to purchase a product that they don’t like.

Think about things like the checkout process and website performance as a hygiene factor. It’s expected of any retailer and not grounds for differentiation. Instead, the biggest factor that will drive sales is actually showing visitors the products they want.

And how do you work out what a visitors actually wants? Observation! Observe them every time they’re exposed to a product and don’t interact. That tells you something about what the customer prefers. It also tells you something about your range. If you have products that no one ever looks at they may as well not exist. If you have products that people always ignore, they are taking up valuable space.

By using all of the information contained in the invitations that aren’t accepted, you can get a better understanding of your audience, what they prefer and why they visit.

The retailers that fail to watch their visitors tend to misdirect their limited product development road map, focusing far too much on technical aspects instead of paying attention to the 98% of visitors who have come to the site but haven’t found what they’re looking for.

Read Top thing to do when launching your product or service – a PR perspective

Dynamically Adjust their layout

The final principle of great online merchandising is that the best retailers are dynamic in their approach to online merchandising. They’re constantly watching how people interact with their product range and adjusting the positioning of products in response.

This means that they’re measuring numbers, such as stopping power, appeal, uniqueness and relative pricing, for each product and using them to put their best product in the most visible positions.

It means they’re responsive to seasonal trends, product launches, marketing initiatives and competitor activity, and are actively optimizing their revenue per visitor minute.

In this regard, online retailers have a couple of big advantages over their physical counterparts:

• Firstly, reorganizing the product range is far easier online. There are no shelving or shop fitouts to contend with.
• It is possible to track visitors behaviour in minute detail and observe how they flow.
• Lastly, they can personalize the layout for the shopper. The shop doesn’t need to be presented the same way for everybody, and, especially as AI is developed for a closer and more intimate understanding of their visitors, they can do a better job of showing them products they might be interested in.

The best online retailers have a dynamic and changing store because they are obsessed with serving their visitors and their needs are constantly changing.

Retailers that adhere to the 7 principles of online merchandising, see improved engagement metrics, better conversion and higher online to instore referrals. Visitors that repeatedly experience finding the product that they want at a fair price become loyal to the brand. Ultimately isn’t that what every retailer wants?

This article first appeared on www.stylefinder.ai