What Makes Merchandising Effective?

Effective merchandising management is so necessary to any jewelry business that it cannot be addressed independent of marketing and sales. Look at many of today’s large jewelry companies and you are as likely to find a chief merchandising officer as you might find a chief marketing officer. It will be the ongoing objective of this column to identify how the functions of merchandising and marketing and sales can all be integrated to create a synergistic effect to drive improved business performance. 

 

In 1927, Paul Mazur defined merchandising as “the planning involved in marketing the right merchandise at the right place, at the right time, in the right quantities, at the right price.” Some eighty years later we are still struggling to perfect the art of managing a merchandise inventory. Over two decades ago R. C. Kean addressed the changing nature of merchandising management activities to include analysis and response to the transformations and processes occurring in planning, negotiation, acquisition, and selling of products inclusively to targeted customers; from “inception to reception” (Grace Kunz), or from “mine to mistress” (Chaim Even-Zohar). Modern approaches to merchandising management address issues of assortment planning and product presentation based on defined market preferences. Knowing what loyal store customers are most likely to purchase is valuable market intelligence.

 

What does merchandising mean to jewelry companies today? For some companies it simply means buying and selling merchandise . . . and that is unfortunate. To others it has evolved from a focus on retail selling to include product planning, pricing strategy, assortment planning, product styling and timing of an offering. Merchandising has evolved from being a sub-function of marketing to become a separate business function responsible for creating a prestigious business environment based on emotionally driven shopper experiences and meaningful symbolic associations. Does your jewelry store environment make people “want to buy” and does your inventory assortment “compel shoppers” to try on merchandise and does your in-store marketing and sales “create a feeling” where shoppers become confident buyers?

 

Old School

New Approach

Merchandising definition- buy and sell product

Merchandising definition- integrated approach to inventory assortment offerings, marketing communications and selling

Selection- based on personal preference and emotion

Selection-based on historic sales and planned sales promotions

Buying plan-I have x amount of dollars to spend

Buying plan-meets stated objectives for gross margin return on investment

forecasting customer desires

Relies on personal selling to sell whatever is purchased

Leverages experiential marketing and consultive selling

Prices based on mark up

Initial pricing is managed to deliver a maintained margin in the final selling price

 

Marketing communications-advertising

Marketing communications-integrated approach to all communicated messages from signage to in-store marketing to the internet