4 Merchandising Tips for Online Retailers
Merchandising in online retail is a whole new ball game compared to the in-store reality that most shoppers are used to. Luckily, there are a few distinct benefits to implementing an effective merchandising strategy online. One is the ease of personalization. Many shoppers want a personalized experience; the following tips will help retailers provide that, with the added bonus of increased average order value:
1. Improve product listings. In-store shoppers are able to fully experience products, but online shoppers are limited to images, descriptions and videos of the products in use (if they’re lucky). Provide extensive and well-written product information and images to increase conversions. Retailers with informative product pages that reflect their branding are able to command higher prices. For example, Zappos has videos of people wearing their apparel and shoes to give shoppers an even better idea of how they might fit.
2. Make better recommendations. When a shopper puts an item into their cart or makes a purchase, retailers are presented with a great opportunity to cross-sell and upsell. The shopper has given them a clue about what they like, and that information helps retailers make more informed product recommendations. While your top-selling products might be good to pitch to a newcomer that's just browsing your site, a shopper that puts something into their cart might be more inclined to also add a complementary item. Personalization is gaining popularity in e-commerce, and the most benefits can be reaped from it when retailers act as helpful associates with suggestions ready. Your website needs to have the ability to fill the associate role seamlessly to make the most out of every shopping experience.
3. Have a competitive product assortment. What you carry is just as important as what your competitors have in stock. This is underscored by the fact that if a shopper on your site can’t find a product they’re looking for, there's a good chance they’ll switch over to a competitor. That’s why Amazon.com is so popular. After all, its nickname is “The Everything Store.” Although your assortment is quite a bit smaller than Amazon’s, there's still room for growth. A comprehensive SKU analysis provides the necessary information by comparing your assortment with that of your top competitors. A quick gap analysis of that data shows where your inventory stands out, is the same and where it could use some improvement. Adding the products that you’re missing can help you pick up extra customers who want to shop efficiently. Adding a dynamic pricing strategy for your unique and in-common products is the best idea because it will make sure that your pricing is optimized, no matter what's happening in the market.
4. Manage inventory with the help of data. Once you have the best products for your vertical, it’s important to make sure that you have an optimal amount of inventory. It’s unfortunately common to run out of top-sellers and be stuck with way too many of a new product that ended up being a dud. Both have different consequences: the former can make you miss out on revenue, while the latter can cut into profit when the products inevitably have to be discounted. Data holds the solution for both. Historical sales data can tell you how many and when products sold. It can also help retailers choose the best price — based on demand — to either capitalize with higher prices or stimulate sales when demand is low.
Retailers that want to jump on the personalization bandwagon can do so with the help of data. From merchandising to pricing, big data has the potential to improve the shopping and selling experience.
Angelica Valentine is the content marketing manager at Wiser, a price intelligence engine for brands and retailers.
Related story: Why Online Retailers Should Reprice Within Reason