Monday, February 15, 2016

Category Management Series: #Crossmerchandizing : You Better Be Careful With It

One of the most known technique about Merchandizing is cross merchandizing. How it works: you place near a best selling product a complementary product, to lift its sales, so you can add an extra product in the basket of the shopper. 
For example, you place the batteries near the remote control sections for the shopper to get both. Most of the time it is highly beneficial, as the complementary product is more profitable than the best selling one. 

Now it does not mean that you should add cross merchandizing all over the store. Indeed, because if you use too much of this technique, you may annoy customer. Moreover, the cross selling product must be consistent with the product where it is placed near. Here are bad examples I found during different store checks. 

Why would you place lipsticks near the perfume section? Same thing: Batteries near the milk area? 
Obviously you may have impulsion purchases anywhere, but by having such cross merchandizing initiative, you are just showing out how complex your offer is, and you are not helping at all your customers.

Two good examples now: The cooking books near the frozen veggies at Picard (which makes sense to use them), and the coffee machine cleaning products near the coffee section. By doing so, you are clearly helping the customer in the purchase and the usage of its product.

But once again, you should be careful at having a clear sense at cross merchandizing initiatives.