Space Planning’s Usual Role

Premise #1

Despite retail executives who claim otherwise, planogramming is primarily used as a one-way planning system. The direct connector between non-seasonal assortments and store operations. Basically a map of where to place the goods unloaded from the truck onto the sales floor. Sure, floor maps and planograms are used for other purposes. But at a basic level, planograms direct store operators where to exactly place products. Can we agree on that?

Premise #2

Shoppers were making selections and purchases for themselves and their households. So the end game was to make the most attractive presentation. Resulting in shoppers seeing an array of choices and better items than they originally planned to purchase. Presented with so many great choices, shoppers might select more or spend more than planned. Or purchase an entire solution or system of goods. (The idea is that they buy not just a new ball glove-- but two baseballs, a bat and a pair of new cleats.)

So the role of Space Planning was to create a presentation to anticipate trip drivers and then surround them with options to expand the market basket and increase the sale. All while making the shopper feel great about the decision to spend. And bind their loyalty to a retailer who gave them so many great choices. 

The Rise of the Professional Shopper

Enter the professional shopper who has completely different goals and constraints. The professional shopper wants the most efficient route through the store to find the exact items in the order. They do not have the latitude to choose a different item. There is no interest in examining choices and making a wise selection. They want to find the exact item and move on. They do not care about purchasing a solution or maximizing the price/value equation. The efficient process of selecting (I dare not call it “shopping”) is all that matters. 

Changes to Support the Competing Role of the Shelf

So there are several accommodations that retailers have to make to meet these new contradictory demands on merchandising. 

New Metrics

In the Category Management process (after defining the category) when selecting category roles, there should be new baseline measurements for the percent of sales driven by BOPIS and professional shoppers. Use that information to inform the merchandising strategy of the planogram. 

1. If it has a low ratio of professional shoppers (mostly consumers shopping for themselves) then continue to merchandise using a good/better/best or full solution presentation to encourage additional purchases.
2. If it has a high ratio of professional shoppers, then consider a regimented approach to merchandising to encourage faster perception of the merchandise organization. That will help professional shoppers quickly recognize the entire selection and home in on the item they need to select for the order. 

New Practices

Let’s recognize that supply chain voids are creating holes in the intended merchandise presentation. Many retailers are giving store operators more leniency for “facing over” holes. That is when they spread lean inventory across shelves to make their presentation more appealing. Certainly, there is good reason to do that. However, when that happens, it degrades the data that professional shopping apps use to marry planogram locations to efficient shopping routes. 

1. Perpetual inventory systems or store operators should be communicating voids in real time. 
2. Voids should be removed as online shopping choices in real time. 
3. Then professional shoppers are directed to alternative substitutes with consumer approval. Ideally, the retailer is using profitability in their logic to recommend substitutions. (For example, always recommend the private label/exclusive brand item first. Or always recommend an item at the same price or higher.) 

New Automations

Stores that face over voids for more than 3 days need to communicate the new merchandising conditions in their stores. A photo combined with image recognition software may be most efficient. Then:

1. Select the current planogram for that store & location
2. Make a new store-specific revision of that planogram 
3. Make changes to the new planogram revision using the photo as the north star guide
4. Replace that new planogram for the previous one in store routing applications for the professional shoppers. 
5. Critically, the system needs to revert to the original planogram version for future planogram updates. The old version is the “parent” planogram that gets updated with a new assortment during normal planogram resets. (This is done so that previous assortment assignments are not lost.) 

What To Do

Look, this isn’t easy. Supporting the competing role of the shelf takes changes in systems and new processes at headquarters and stores. Which means change management, training, communications and new reporting. None of those things are impossible. But sequencing is critical.. And no one has extra resources to put against an initiative like that. No matter how necessary. 

Luckily, Delaney Consulting excels at just this kind of work. Give us a call. It doesn’t cost a thing to talk…..