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The Four "I's" Of Merchandising

Friday, February 1, 2008

The Four Did you know that the word "merchandising" is spelled with more than two I's? Speaker and consultant Lisa Duncan of Duncan & Duncan Enterprises does—and shares these I's with store owners in her seminar called "The Art of Retailing – A Peddler with Panache™." As a third- generation retailer and 25-year fashion industry veteran, she has acquired extensive knowledge about Image, Intention, Invitation and Ingenuity. Read on, as she discusses their impact on retailing success.

Q. Why must retailers have a clear vision of their Image?

A. It is very important that store owners define their store image and know exactly who their target customer is. Your target customer [can be based on] age, education or the type of music he or she likes. [An owner's image statement might read,] "I have a gift store that sells items to tourists in South Beach." As the owner is buying, that's what she needs to keep in mind. That image also defines the design of the store and your advertising, sales techniques and merchandising. You must stay clear on your store's image—and not try to be everything to everyone.

Buying affects how you enter the new year. [Let's say in 2007] you went to market and saw 15 trends that made no sense for your store but you got off course and bought them anyway. All of a sudden it's the end of the year. Now, 80 percent of your merchandise has to be marked down so you have budgets for open to buy, advertising and more. If product does not go with your image, don't buy it. When you are buying, remember that 80 percent of merchandise is where your bread and butter is. Always leave 20 percent of your open-to-buy money for [merchandise] that will put your store on the cutting edge.

Fashion trends lead the way in every industry. If you can stay up on those trends, you will start to see them translate into gifts and home furnishings. [Trendy] merchandise should make sense and work in your store. Have an awareness of trends. Listen to music. Sit in an airport and watch people come and go. What are they reading, eating and wearing? What kind of bags are they carrying?

For 2008, trends will be celebrity-driven. Look at magazines at the checkout stand, especially if your customers are age 20 to 45. Color is always the No. 1 trend to watch. [Some hot colors] for 2008 will be rose, lime green and orange. Think about how you can translate those colors into your inventory. If they don't make sense for your store, use one of them in your tissue paper. This shows that you are up on trends, but doesn't cost a lot of money.

Q. Why should store owners inform staffers about their merchandising Intentions?

A. Communicating your merchandising Intentions to sales associates is the most important part of your business. They're the ones on the sales floor selling and taking care of things while you're at market. You want to help them build a clientele, succeed in their careers and stay a long time. If they don't know where you're going [with your merchandising], how are they going to help you succeed? If you're not having staff meetings and communicating, you're not getting them excited. New product will come in, they'll unpack it, it will sit on shelves and nothing will sell. Instead, help your employees unpack, get them excited and they'll sell for you.

When you go to market, take pictures of everything—the showroom, the new items you bought, a dinner with your sales rep—and put them into a slide show. Your employees will feel like they've been at market, and they'll start thinking about who they'll sell these items to. Have weekly staff meetings where you say, "This is what's coming in this week," "This is how I want it displayed" and "Do you have questions?" Have sales reps show your employees how to sell. I had vendors in my Texas store all the time. If they're in town anyway, why not ask them if they'd mind coming in for 30 minutes and show the staff [for example] how to tie a new belt?

Q. How do your storefront, windows and store interior send an Invitation to customers?

A. You may be in a strip mall or in a tourist area with 50 other stores like yours. What gets people to come into your store? [A big factor will] be the storefront and window displays. You can really make your store look sharp if things are beautiful and clean. Ask yourself: Are there dead plants in the window? Is the window clean? Is the store vacuumed? Are the dust bunnies swept up? Are your lights working, or are three spots out? If your store name is up in lights, do they all work—or are they spelling some obscure slogan? Are the glass display cases smudged? Make a daily list of basic housekeeping chores, and do them every morning before the store is opened. Customers will stay longer and there's a better chance that they'll buy something if your store is clean, comforting and warm.

Store windows can tell people that you are aware of what's going on in your city. Look at who is in town, and what conventions are there. If you have a gift store and a New Age convention is going to be in town, do a window display of beautiful textiles, crystals and incense. You don't have to buy anything new, just move store items up to the window. This is a trend in itself, [where] you don't do anything different or spend money to get new customers in your store. If your chamber is putting on a big blues festival, get a festival poster and put it in your window. That poster says "Welcome!"

I worked from a calendar of events for my Texas town. You can also be a chamber member or go on a [local or regional] tourism website. The size of your town doesn't matter. The women's guild may be having a bake sale, or tourists may come to your area to ski and fish. You may also want to use some of your advertising dollars to put an ad in a new age magazine or the city newspaper where those tourists live.

Q. How does Ingenuity impact a store's bottom line?

A. Once you get customers in your store, Ingenuity plays a part in making the sale. Your display creativity spotlights items, makes shopping exciting for customers, staffers and you, spurs customers' creativity, fulfills a need and gets customers to buy from you rather than someone else. It also means you have open-to-buy money as opposed to marking down items. You need to give customers visual merchandising ideas about how to wear items, use them, create multiple sales and more.

Window displays are like theater and suspense. What's in your store window may or may not have anything to do with your merchandise. If your symphony is doing "Phantom of the Opera" around Valentine's Day, clean out your entire display window and place a heart-shaped silver music box on a glass brick column. Shine one red and one white light on the music box and have a sign that reads "Happy Valentine's Day." This is the ingenious part of merchandising that makes a dramatic impact, and is simple and inexpensive.

Seasons are a good time to put lots of merchandise in the windows. It could be a Christmas tree with 20 different items each placed in unwrapped boxes beneath it. This [display] speaks to your store's diversity and variety. If you have new merchandise coming in, place the new items in the window on a pyramid of glass bricks. Then, use signage to say that you have all this new merchandise arriving.

[Along with displays,] signage is a salesperson that acts on your behalf when you're busy selling and waiting on people. Lead customers to the back of your store with signage, so you can keep them in the store until you can get to them. You'll also have a better chance of selling them something. Signs need to be professionally printed or run off on a computer, and then framed. All signs should use the same [fonts or logos] and be in the same type of frames. The customer's mind gets used to seeing this repetition. I really believe in repetition in signage, merchandising and advertising.

After Christmas and before inventory is the time to assess your store. Think of simple ways to freshen up the store. Nothing is easier than lightening up the store with a fresh coat of paint. Clean or buff wood floors, clean carpets and strip wax off the linoleum. Lighting is the most dramatic and inexpensive way to change a store environment. Have a handyman drywall a niche in your store and add lighting. Go to Home Depot and get some track lighting, and you can change the whole look of the store. Add colored lights in the store window to create a fancy display, like orange bulbs for Halloween and pastels for Easter. All its costs are the $8 light bulbs. Combine cork board and frames to create new and simple wall displays that will make display items look like pieces of art.

Q. What other suggestions do you have for helping retailers add "panache" to their new year?

A. The interim period from January to Valentine's Day and President's Day can be tough, so you need to shake it up a little bit! It's a brand new year. Determine what worked and what didn't work [in 2007]. Remember that it's your responsibility as an entrepreneur to keep yourself excited. If you're not excited, nobody else will be. Take classes, brainstorm with 10 other retailers, subscribe to a new publication, go to a different market or hire a different kind of staff.

Hopefully, every retailer gets up on the first of January and lays out a business plan for one year and for three years. The plan can include what to do this year that you didn't do last year, such as adding more sales staff or concentrating more on the customer. If there are customers you didn't see [last year], the first of the year is the time to build back that relationship. Tell customers how much they mean to you. Pick up the phone and say, "Hi, I've missed you. We're having an event next Saturday. I hope you can stop by. …How are your kids? Where did you go for Christmas?" Send out monthly cards to loyal customers that read "Please bring this card in [on a certain] Saturday for 10 percent off."

Note: To contact Duncan, log on to

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