Off the Shelf provides a platform for Retailers and Consumer Packaged Goods companies to discuss and gain insights on the pressing problems, trends and solutions.

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July 31, 2012

Paradigm Shift in Loyalty Card Programmes: Win-win for Retailers, CPG Brands and Customers

Guest Post by

Srinivasan Nithyanandam, Manager, Client Services for Retail,  CPG and Logistics - Europe , Infosys


Battling slow economic growth and high costs in a difficult market, retailers are competing aggressively to increase their customer's wallet share and mindshare. The new breed of digital consumers, who want convenience, personalization, and promotion-based pricing, has made winning in this environment even more challenging. Operating within the tight confines of single-digit-percentage operating margins, retailers must continuously innovate to increase consumer foot falls and clicks. In such an environment, personalised offers, rewards, targeted communications and promotions can help heighten customer interest and encourage repeat shopping.

Loyalty card or shopper identification programmes help retailers deliver value and relevance to their customers through a three-pronged strategy that involves:
•Identifying and acquiring customers
•Collecting data to understand customer requirements
•Influencing customers with attractive targeted offers and communications

While loyalty card programmes have given some retailers an edge in helping retain consumers and maintain market share, these initiatives can cost a supermarket retailer 1-1.5% of its revenue. Many enterprises that have launched loyalty programmes have not been able to make full use of the customer data they gather. Moreover, the proliferation of loyalty cards in the market makes it impossible for every programme to build and sustain a worthwhile engagement with the customer.

To attain their objective, loyalty card programmes must not be seen as a mere mechanism to award / redeem points or offer a freebie. The most effective loyalty programmes are those that reward customers in a way that encourages loyalty and drives them towards a greater spend, longer tenure, and positive advocacy.

In this context, the loyalty card must be leveraged as a powerful customer analytics tool. It needs to help retailers analyse customer data and provide valuable inputs to shape campaigns and formulate customer strategies. These programmes must be used to gain insights into buying behaviour and provide real - time answers on how to influence  consumers.

Such a paradigm shift in loyalty programmes helps retailers engage with their consumers  more deeply. It also provides actionable information for effective decision-making on pricing, promotions, ranging, space planning, store format / locations, new product development, and communication strategy - all of which contribute to increased revenue.

This revolution in gaining customer insights is reflected in one of our customer's success stories in transformation from loyalty provider to analytics provider.


July 12, 2012

Mantras for creating store Layouts and Displays

Hey Guys..!! It's a weekend ahead..! Planning for some shopping..??

And you might be looking for some good stores with nicest displays, are you?

Have you ever wondered how easy it is for retailers to create a store on your expectations?

Well, let me tell you the very fact about it, there is a hell lot of planning which goes on before giving you something which you find as "SIMPLE".

It's not that easy for retailers to conceptualize their store for maximum footfalls and conversions, rather it's like an iceberg where you hardly see 20% of its size on surface, and 80% still lies below the visibility layer.

Have you ever wondered, what lies in the remaining 80% part that you can't see..??

As far as I can understand it there are various key 'Mantras' that retailers follow to ensure the best store layouts and displays:

1. Human psychographics: human psychographic factors give an important touch to the store because the subconscious mind of the human being many a times plays more important role than the conscious mind. There are certain factors which greatly influence the footfalls and sales of the stores such as: people see at their right hand side first and move toward that most of the times, this factor may be used to boost up the store sales for a particular category and if a right attraction factor is arranged in such a way, it could enhance the overall sales of the store to a greater extent.

2. Category flow: sensible and easily understandable by the customers. Display should tell story about the product usage so it becomes easier for the customers to relate and understand. It should be enabling customers to move throughout the store without him knowing the same.

3.  Adjacency plan: within the category, the products should be kept maintaining a flow of understanding, based on a particular criterion. This makes it easy for the customers to choose products faster without the products being left out of sight.

4. Appropriate use of fixtures and textures with great ergonomic planning is what make the shopping experience even more pleasant.

5. Use of the focal walls: should be given to a product that appeals to the customers the most and is able to make them stay longer in the store.

6. Use of color combinations and proper lighting improves the touch and feel of the store, attracts customers, and meanwhile increase their curiosity about the products. Especially Spotlighting in case of window display has a great significance. Using the concepts from color wheel definitely holds eyes towards the merchandise for longer.

7. Signage: play very important role for enhancing customer understanding in different terms like directions, product usage, promotion and many more.

8. Activation zone: the space where the promotional campaigns actually work. Mostly these are easiest approachable places in the store and receive a lot of customer attention.

9. Neither empty shelves nor the over flooded shelves are going to help; customers don't like both of the situations knowingly or unknowingly.

10.  Washrooms/trial rooms etc. needs to be maintained as per the need of the retail format. And should be clean & clear, appropriately ventilated and separated from the store yet properly accessible.

11.  Hot Spot Planning: Hot spots in a store are the most significant places for promotions as maximum traffic engagement is found at these places, might these be at the entrance, in the center, or on the end caps of the aisles depending upon the area and structure of the store-floor.

12.  Window Displays: The story that's hidden in the windows of the store is something which pulls crowd from the visibility zone and facilitate high footfalls.

13.  The consistency factor: Finally a consistent combination of all the factors in the store is what creates an overall impact.

Have you ever given a thought, how different it is from what you thought earlier..!!

It takes more than a few days, weeks or months to generate this entire plan which helps you buy at the stores. There is probably even more than what I have mentioned above. If you know a few of the other things, please hit the comment button and let everybody else know about it.