Savvy merchandisers know how to use Good-Better-Best merchandising to showcase a range of products to appeal to customers. As a customer begins the “scan and shop” process of searching through the store for either a necessary item or a browsing interlude, the Good-Better-Best merchandising approach is logical in helping them make their purchase decision.
This proven merchandising and selection tactic begins with an opening price point item: a “basic” item. Let’s say it is a plastic mechanical pencil. It contains one lead within the chamber, one eraser at the tip and could be refilled in the future. It is $1.99. The “better” item may include a small plastic container which contains additional lead and eraser refills. Its is $3.49. Finally, there may be a much better version that is made of a better quality material, contain the refills as well as a second pencil for $5.99. In this example, it is easy for the customer to see how with each step up in price, there is a corresponding improvement in the product and its value. The customer will have to part with more money to purchase the “best” option, but it usually has a perceived higher value than either of the other choices.
The power is that there is always a choice for the customer who may be pressed for cash and needs a low-investment solution or for the customer who values a higher quality product and is willing to spend more to get more. A smart retailer has at least three options of most items to allow a customer to feel they can make a wise choice among the options depending on their needs and values.
There is nothing magic about having three offerings. In a product line that the retailer wants to dominate, there may be 6 or 9 or 14 offerings. The important thing is to arrange the merchandising in such a way that the customer can easily see how stepping up and down in price generates a similar change in product features. Think of times when you have compared seemingly similar products at two different prices. Customers always wonder, “What else do I get for the additional cost?” As long as you can clearly demonstrate the difference, you may be able to carry a very deep selection of products in a single category.
For the well-managed retail store to offer its customers an edited, yet relevant selection of products, consider the Good-Better-Best merchandising approach. Use it to guide selecting and pricing your assortment. Make sure the customers can easily see (through merchandising, signs and demonstration models) the increase in features with each jump in price. Select a smart basic model that has the minimum features your target customer needs at the right price. Select products that expand with desirable features up to the maximum price you believe you can command in the market. Carefully review decisions to eliminate choices to make sure you have an offering that keeps you relevant to the target shopper and wont send them to another store (or the internet) to make their purchase decision.