Retail Owners often misunderstand the importance of Visual Merchandising in running a successful Retail store or Boutique. The common misconception is that Visual Merchandising is only about making things “look pretty”, “dressing mannequins”, or just “fixing displays”.
By Nichole Simms
While all of these are components of Visual Merchandising, they don’t even scratch the surface of the art and the science of Visual Merchandising and how it can greatly impact the success of your business.
Here are the 4 ways or Key Performance Indicators (KPI’s) that can be dramatically improved by properly having a strategic Visual Merchandising plan.
1. Increased Traffic
Having increased traffic is very important to the constant success of any Retail business. You cannot grow your sales and your business if you don’t get new customers on top of your repeat ones. To get more customers (traffic) to your stores, you need to find ways to attract them to your store.
Your windows are the quickest and most effective way to attract new customers. Think of them as the “soul” of your store. They give a snapshot of what you sell and who your brand is. Engaging, colorful, well lit, and balanced windows that tell a compelling story, will attract new customers to you and will encourage them to shop your store. This is low hanging fruit for your business.
2. Increased UPT
Basket size is very important to your bottom line. The more customers purchase at one time, the higher your overall sales results will be. Unit Per Transaction (UPT) is the basis of this concept. You want to encourage your customers to not just walk out with just one item. You want them to leave your store with multiple items so your can make higher sales per transaction.
Multi-layered mannequins/bustforms, tables folded with 2-3 different items, and displays showing multiple collections or accessories are key to mastering this metric. You need to show your customers that they “need” to buy more than one item for that “complete look”, that “entire collection”, or “all the accessories” so they are not missing out on their purchase.
3. Increased ADS
Basket size is not just about how many items a customer is buying at one time, it’s also about the total dollar amount of that sale. Average Dollar Sale ( ADS) is another key metric that is important to your bottom line. To make your sales goals at a faster rate, your average sale should be at a higher dollar amount to remain profitable. It’s simple math: You appreciate every $50 sale that happens, but a $150 sale is even better.
To increase ADS via visual merchandising, you need to showcase your higher end products in key areas throughout the store. Faceouts on key walls, and floor fixtures placed on the aisle and at the front of the store merchandised with your full price, higher end, or specialty items will allow your customers to engage with these items and encourage a purchase.
4. Higher Conversion Rate
All of the above metrics all come together to make up this last and most important one: Conversion Rate. This metric measures how many people that come into your store are converted from onlookers to actual customers. In addition to the above points there are a couple of more key strategies that can improve your conversion rate. Your signage strategy is a key part of converting your customers. Pointing out Promo/Clearance items, highlighting New Arrivals, and informing where categories (dresses, tops, accessories,etc,) are in your store, can turn any onlooker to a customer.
Having Focal Points throughout your store will also contribute to this metric. Focal Points are a collection of fixtures ( tables, t-stands, mannequins) that are placed in key traffic areas that promote impulse buying. They feature a secondary story or collection to appeal to your customers interest. By keeping your customers informed, making their shopping experience seamless, and making it easy to find what they want fast will all contribute to a higher conversion rate.
Having a strategic Visual Merchandising plan is very important to the overall success of your Retail Store or Boutique. It’s not just about how your store looks ( which is important) it’s about the engagement, experience, and emotional investment that your customer has with your store and your brand. All which can be accomplished through the power and strategies of Visual Merchandising.
Nichole Simms is the CEO of the Retail Consulting company Creative Visual Solutions. She has 30 years of Retail and Visual Management experience working with some of the country’s top brands. Now Nichole helps Boutique and Small Retail owners increase sales and traffic by building the business of their dreams through the power of Visual Merchandising.