As the saying goes, “first impressions last”. But in a tough retail trading environment, with growing competition, the way a retail store is perceived by potential customers can be the difference between going bust or breaking even.
According to the Westpac-Melbourne Institute Index, consumer sentiment also fell to 104.9 points in April, from a two-year high of 110.5 points in March – which suggests consumers are also still tightening their purse strings.
However, according to business fitness specialist Marguerite Bell, from the Retail Doctor Group, innovative visual merchandising may be the secret weapon for bricks-and-mortar retailers who have lost their edge and looking to stand out from the crowd, or entice new customers to buy.
With online shopping also on the rise and technology changing the face of the market, visual merchandising which incorporates digital elements can also assist retailers to adopt a more omni-channel approach to business.
“On average, a customer has three seconds to be impacted by your window display,” Bell says.
“During this time they need to be captivated, understand your offer, be compelled by your message and have their ‘buying radar’ switched on.
“Once customers have entered the store, keeping their interest and utilising store layouts to increase dwell time and building displays that draw the eye and encourage multiple sales is important.”
For fashion retailers, she explains, visual merchandising can also be a particularly powerful tool, and a very smart investment.
“Visual merchandising is the retailer’s opportunity to make their mark, stand out from the crowd and create a ‘wow’ factor. In fashion particularly, it’s about new season looks, colours and trends, and visual merchandising is a key way to show product and highlight to customers. Investment in high quality, flexible fixtures and fittings also mean that as seasons and trends change, minimal additional investment will be required to keep the displays looking fresh and exciting.”
In her role as a business fitness specialist at the Retail Doctor Group, Bell regularly conducts ‘business fitness checks’ to assess the health of a business and often guides retailers in specifically how to revamp their visual merchandising techniques to make more of an impact.
Generally, the firm concentrates on improving a few core areas of visual merchandising that can be consistent trouble spots for retailers, such as:
- Window displays that convert passers by to shoppers;
- Strategic product placement including adjacencies that facilitate add on sales;
- Store layouts that increase customer dwell time and encourage multiple sales;
- Using signage to communicate the brand positioning.
But Bell explains that the first step – before committing to any high-tech fixtures, signage or in-store fittings – is always to identify the retailer’s core DNA to determine what will work best for the type of business and its customer base.
Whether it’s a start-up which is just emerging in the market or an established business looking to revamp via visual merchandising, Bell cautions that there five key points that retailers need to consider first, to ensure that the store’s concept and visual merchandising are perfectly aligned for the target market:
“Who is the target market? The essential first step to knowing how to design a store is knowing who you are designing it for.
What is their brand positioning? This must shine through in the concept delivery.
What is their budget? There are some fantastic concepts out there that can be built on a shoestring if retailers think outside the box. It’s about choosing a concept that will stand the test of time and choosing quality, flexible, fixtures and fittings that will have multiple uses.
How will the store concept tie in with other channels such as social media and online? It is essential to be cross-channel now.
How will the concept maximise and drive sales? Consider adjacency planning here and how the display of product will show your product at its absolute best.”
Once these questions have been answered, the task of creating the store’s concept begins, and more recently, various new technologies have begun emerging to help retailers visualise the final result to get it just right, before a cent is spent.
International design software firm Dassault Systèmes specialises in an array of such technologies, and for retailers starting from scratch, the insight the software can provide is invaluable, according to Susan Olivier, vice president of the consumer goods and retail section of the firm.
“Many companies invest considerable time and expense to building full-scale physical mock-ups of an actual retail store or department, installing fixtures, floors, lighting, visual decor and point of sale materials to simulate the look of the final shop, then loading the fixtures with rush first deliveries of product to visualise the results of each delivery,” she says.
“But if the assortment doesn’t look quite right or the planned department adjacencies don’t work with the store layout, only minor changes are usually possible by this time. And that’s just for an ideal or average store – what about the unique footprint or assortments found throughout a chain? And what about the ability for store managers and visual merchandising teams from different regions to experience this ‘ideal’? Very limited indeed.”
Advances in technology and software specifically tailored to streamline visual merchandising, such as the software offered by Dassault, work to reduce this risk, by allowing retailers to experiment with various store concepts and set-ups, and visualise the store layouts and department adjacencies.
The software by Dassault also allows users to drag and drop fixtures and products to create the look in 3D, before having to commit to production.
The final result is a 3D rendering which enables the user to virtually walk the store, move the product, and compare options in real-time. Featured products and the in-store graphics can also be adjusted for maximum appeal based on a virtual ‘walk-through’ from the consumer’s perspective, using store associates and consumer focus groups connected through a web browser.
“This ensures the most appealing selections,” Olivier explains, which in turn means better sales and margins, and faster cash flow for the retailer.
“Whether retailers are focused on maximising the margin and uniqueness of their private brands, or maximising sales productivity of the prestige national and international brands they feature, being able to visualise the store from the perspective of the customer is critical.
“Way beyond a 2D rendering, the ability to experience the store in a lifelike 3D immersive experience opens powerful new opportunities for both productivity and delight,” she says.
To date, Dassault Systèmes, originally established in France, has worked with over 40 fashion retailers and brands across Europe and other regions, but in Australia, Olivier says these types of technologies are now also being more readily adopted by local retailers, as international competition looms.
“3D technologies seem to have caught on more quickly in Europe, perhaps because the regional differences in visual merchandising are so vast. Either way, some regions always go first and the others have the benefit of leveraging that experience.”
Olivier adds that it is critical, however, that Australian retailers – and fashion stores in particular – continue to advance in this area if they are to survive the changing market.
“Today’s customers are increasingly interested in spending again, but the environment has changed considerably. She can shop in-store or on-line where the competition is just a click away. She expects great value and good service. So how do you entice them into your store, versus the competition?
“The experience of walking into and browsing around the departments of a fashion retailer can be as important as the design of the clothes themselves in influencing customers to linger and try. It doesn’t matter how fantastic the product is if it’s poorly merchandised and the customer cannot really see it or appreciate it (wrong spot, wrong fixtures, wrong adjacencies). The visual appeal of the product in context of the store and fixture is the ‘first moment of truth’ for retailers.”
At the forefront of this realisation are tertiary institutes, such as the School of Fashion and Textiles at RMIT University, which is constantly preparing its students for the tough retail market they will encounter.
Visual merchandising as a result, is an important component of many of the courses offered by the institute, including the Certificate IV in Fashion and Textiles Merchandising, Bachelor of Applied Science (Fashion and Textiles Merchandising) and postgraduate Master of Fashion and Textiles.
“Our current students are future industry leaders and professionals, so it is absolutely crucial for them to understand current and future retail trends and environments,” explains RMIT University Professor Olga Troynikov.
“Effective visual merchandising as well as general store concepts translates into the higher sales revenue per square metre of the store floor. Recent research studies definitely confirm this – the right store environment, visual merchandising techniques and combination of technology and human presence contribute to positive purchase outcomes.
“So is critical for the students to be skilled in and be able to appreciate both virtual and real store concepts as well as their symbiotic co-existence in the years to come.”
As a result, students at the School of Fashion and Textiles at RMIT University work closely with brands and retailers – from well-known iconic brands such as Country Road, Sports Girl to boutique brands – in their course projects. Students at Master level also carry out a number of research projects as part of their study which are based both domestically and internationally.
The fusion of digital technologies with traditional visual merchandising techniques – such as digital signage – is also a key component of studies at the institute.
“It is now common knowledge that evolution and rapid growth of digital technologies and omnipresent nature of the internet significantly transformed how fashion consumers shop. With the support of latest digital enabling technologies such as body scanning, virtual fitting rooms, virtual interactive “mirrors” and others, proactive fashion retailers are trying to combine the virtual with the “real” to improve customers’ experience both on-line and in-store and to leverage sales resulting from a single approach,” Troynikov says.
Shopping centres which, in Australia, have also recently begun to place more importance on visual merchandising than ever before.
Harbour Town in Adelaide, is one such centre, which has recently joined forces with the Retail Doctor Group to assist its independent retailers to identify weaknesses in visual merchandising and action changes.
The retail support program consists of the usual ‘Business Fitness Check’ to diagnose current performance and provide actionable solutions to improve the health of the business. This can sometimes include a change of budgets or customer service improvements, but quite often also includes shift to more effective in-store signage and visual merchandising, Bell says.
“I think shopping centres are realising now that the image of their centre is heavily shaped by their retailers.
“By improving the in-store and window visual merchandising standards there is a lift in the overall visual impact and in turn an increase in sales for both the retailer and the centre,” she says.
She believes there are a number of challenges preventing local retailers from mastering visual merchandising though – one of these being the lack of knowledge, followed by budget restraints and sometimes, lack of skills.
“Many retailers also have little time while running a business to step back and build new and fresh concepts that will invite sales, and for the smaller retailers, it may not be feasible to run visual merchandising training for their team.
“Due to budget constraints these retailers can’t always be bringing in new concepts, but there are new ways to use the same fixtures and fittings by looking at new techniques. And by the shopping centres providing the training to a larger number of businesses, these barriers are easily overcome.”
Jack Hanrahan, retailer relations national manager for Westfield, agrees and adds that – even for the shopping centre giant, effective visual merchandising has become a high priority.
“Visual merchandising is a unique opportunity for retailers to tell a story, to give style inspiration, and in today’s digital world where shoppers have more for physical stores, visual merchandising is more important than ever,” he says.
In his observation working with Westfield centres, which are home to hundreds of physical retailers across the globe, Hanrahan adds that he’s also seen various new trends emerging from pioneering retailers, in line with technological advances.
“Across the world and in Australia, we are seeing innovative and creative visual merchandising that can be costly, but it is high-tech and extremely sophisticated. Examples of this include the use of LCD screens or automated mannequins and displays that give a new dimension to previously static displays,” he says.
“However, at the same time we are also witnessing some authentic and innovative visual merchandising that does not cost a fortune. This is where retailers most simply are utilising space better or creating new spaces within their stores.”
The shopping centre currently offers a visual merchandising consultant program free of charge to its retailers and also annually sponsors the Westfield Retail Study tour, to give all retailers exclusive access to view and learn from some of the best examples of visual merchandising in the world.
Brands visited on previous Westfield World Study Tours include fashion behemoth Zara, J-Crew, and Uniqlo.
But while it is impossible to discount international retail leaders as masters of visual merchandising, there are also various shining examples on home ground, according to the Australian Centre of Retail Studies.
Their pick? Local fashion footwear etailer Shoes of Prey, which recently opened its first bricks-and-mortar store, to much fan fare.
The store, located within the David Jones’ flagship Sydney outlet utilises various features including technology, music and scent to not only draw customers in but also create an immersive experience.
At first sight, a 2.4 metre flower sculpture made from shoes grows out of the large round table that forms the centre piece of the store. The flowers are framed by the large back wall featuring the logo and tag line “Design your perfect shoe”.
Also on the wall is a museum-style showcase of shoes with tags on each pair revealing details of who designed the shoe and where they are from.
A rainbow made up of 157 leathers, laid out in colour order, adorns the back wall, with boxes containing swatches of all the same leathers also available on each ‘designing table’ so customers can easily choose which to use.
The stools the customers sit on are also made from shoe leathers, and six iPads are available throughout the store for customers to use in the shoe design process.
The finer details of the store also include a customised soundtrack, composed by ARIA winning artist Neal Sutherland, and a Shoes of Prey scent which emanates throughout the store.
Talk about ticking the boxes.