A planogram is one of the most important tools that you can use in your retail stores. That is because your customer demand will always change and planograms are based on customer demand. The benefits of using a planogram including visual merchandising, cross-sell opportunity, and space elastic demand are covered in the blogs from Quantzig. A planogram is the virtual representation of the availability and number of references to a shelf within a store aisle and allows the shopper, engaged in the purchase of a product, a more intuitive reading of the shelf. The purpose of a planogram is to increase sales by ensuring that the most popular and profitable products are given the right amount of facings and allocations. Designed a month or two before they are implemented at stores, planograms are never static. Otherwise known as plano’s, shelf space plans, schematics or POG’s, a planogram is a tool used in visual merchandising. Once you’ve chosen a layout and designated where your fixtures will go, you’re ready to put the right stuff in the right place, where it will pique customer interest, encourage interaction, and inspire sales. You’ll have a better grasp of your product and category performance. Explore Our Category Management Insights. Benefits of a Planogram. Planograms are a key part of running a retail store. When it comes to the benefits of planograms, they can be classified into both short-term and long-term. Read on to know why cloud-based planogram would a perfect planogramming tool for you! BENEFITS OF PLANOGRAMMING Our customers have reported great successes with Shelf Logic in many areas. On the other hand, when this principle is not fully leveraged, the cost to you as a retailer is significant since it affects everything from your sales to out of stocks. But a planogram’s ultimate goal is to help the store drive sales. Take the Free Test Drive! This article explores planograms, the challenges they present and how retails ongoing digital revolution along with artificial intelligence is changing planograms as we know them. It’s also a model or diagram that indicates the placement of retail products on shelves as well as the number of facings each product should be allocated. If you have many stores, it can prove tiresome to design planograms for each and every one. Planograms tailored to the needs of individual stores are almost invariably highly effective. Using a planogram in your retail store will lead to more happy customers and more sales. Your product replenishment will be both simplified and optimised. Each month, you should get a report of all the sales that you made and compare them with your planogram. Let’s unpack the short-term benefits first: Your data will be clean and your products classified. Copyright © 2020 DOTACTIV (PTY) LTD. All rights reserved. Here is an example of a planogram showing the layout of one set of shelves. It will allow you to: You can expect a significant increase in sales and stock rotation. The bottom line is that Shelf Logic has increased company profitability by getting more product onto the shelf, getting it to more customers, and getting an edge on the competition. Without data, any allocations that you give them will be pure speculation. After the design and implementation cycle of your first planogram, your next re-designed rollout should be based on your previous results. You’ll have better space allocation, which means an immediate increase in sales. These web-based planograms provide numerous benefits in terms of scalability, availability and feature updates. Planogram is a diagram or a model that indicates the placement of retail products on shelves. How to Make a Planogram. Source: Nielsen MarketTrack. So how do they make such an impact on store performance? Considering the purpose of a planogram is to increase your sales, it’s hard to argue against implementing them in your store. Creating a planogram may be tedious, but it’s worth the effort. A cluttered store fails to attract the customers. Better balance between consumer demand and shelf inventory (, A shelf layout that stimulates purchasing behavior (, A consistent image and marketing message (, More efficient use of staff during shelf-resets (, More influence on the assortment and space allocation (, Quick and simple "reality-check" when developing new product packaging (, Increased success with product-introductions (, Improved relationship with trading partners (, Better insights in the performance of the competition (. While you still need to group similar stores together according to size, demographics, sales and so on, the process of building a planogram and applying it to a group of stores is as simple as clicking a few buttons. Advantages of using a planogram in retail Planograms are a very useful tool for trade marketing, since they provide multiple benefits. The DotActiv team comprises of multiple category management experts, all lending their years of retail experience and knowledge to create well-researched and in-depth articles that inform readers of DotActiv’s retail blog. Key Features and Benefits One of the main benefits of a planogram is that it helps merchandisers stay organized, as well as take full advantage of their entire retail store space. DESIGNING PLANOGRAM• Planograms include shelf heights, product placements and the amount of facings• Shelf heights depend on the size of the products and ease of reach for the client• Product placement describes on which shelf and where on that shelf a product should be placed• A facing is a row of products. It should actually ensure you enjoy the process. In this type of planogramming strategy, the … The process also took a couple of hours. It is thus imperative that the products which are both popular and profitable are given enough space allocation on your shelf. It can also be extremely time consuming when creating 1000’s of Planograms or indeed having to update 1000’s of Planograms. An aptly designed and managed planogram boosts sales, cuts down on costs and enhances overall consumer experience (thus, making them more probable to return). Another great aspect is that you remain in control of how your planograms will be automated. Attempt to create a data-less planogram and you’re essentially wasting your time and money. Both your store consistency and retailer brand awareness will be improved. Facing allocations can be updated with seasons, special events and new assortments. Visual Appeal for Your Customers 1: Space elastic demand. The result is that your consumers experience your strategy whenever they visit your store. When it comes to the benefits of planograms, they can be classified into both short-term and long-term. Planogrammer is a person who uses planogramming skills to come up with a diagram on placement of products. In this article we will discuss the benefits of using planogram software for retails specifically. Your business needs effective supply chain and product portfolio management protocols to thrive and to grow. The end goal of a planogram is to increase your sales and profitability by ensuring that your shelf displays offer the right selection of products to reach your shoppers at the right place and time. Considering that planograms can dictate the layout of your store, they also serve as an opportunity for you as a retailer to be consistent in everything you do. With the right data, you’re also able to present your shoppers with both a logical and friendly product layout while simultaneously maximising the efficiency of your shelf space. Planogram Purpose Product placement and improved sales are just two very basic reasons a retailer should be implementing planograms in their shops. © Global Retail Business Solutions Ltd. All rights reserved. Increased sales due to: better shelf sets and product mix to meet consumer demand; more effective promotions on critical items; better in-stock levels throughout seasonal swings Get free education, tips, and inspiration to help you refine and grow your product categories. We’re here to help. In continually re-designing your planograms, it means that your stores space allocations can be repeatedly refined for optimised sales and consumer satisfaction. And even if you do get one or two right by chance, it will still skew the entire shelf, let alone your category. The Benefits of Planogram SoftwarePlanogram is an illustration or drawing that provides details of where a product should be placed on a shelf and how many facing that product should have. Your sales strategy will be realised at store level. This is a positive since it gives you the opportunity to build a solid reputation as a go-to retailer for a particular range and product layout. Working with planograms has already lead to many successes. That means that your planograms are designed or re-designed when the seasons change, when your assortments are updated, when new store openings are planned, as well as when you need to refine your category management strategy. There is also the case for the implementation of a localised assortment plan since with it, you can improve your in-store experiences, satisfy your consumer’s needs, and provide the right product at the right place at the right time. Often confused with ‘plano guides’, many believe that a meaningful planogram can be created without sales data. Optimum space utilization in a retail business ensures better profit margins. There are many benefits to using planograms for planning out your store layout, and they generally fall under two overarching advantages: maximizing sales and space. 4 Benefits of Planogram in Retail Industry . Planograms provide many other positive benefits as well: Assigned selling potential to every square foot of space There are many benefits to using planograms for planning out your store layout, and they generally fall under two overarching advantages: maximizing sales and space. In short it always comes down to the fact that by using planograms and the accompanying analyses the financial performance of a category improves. If the space allocation is done right, the shelf space will return the highest profit. GoPlanogram gives you your own website for powerful, cloud-based planogramming and provides, for the first time, rapid interactive web-based display design running in your browser. One way of centralising your sales strategy is by dictating product layouts with planograms. With GoPlanogram, one user or hundreds can quickly and easily design profitable displays. The planograms are built automatically according to the retailer’s merchandising guidelines and tailored to the demand profiles of each store. In doing so, you’re able to please your customers and understand which products are performing and which are not. [Guest Post] How To Update Your Product Portfolio To Ensure Smooth Supply Chain Operations, need a rock solid assortment planning strategy, building a planogram and applying it to a group of stores, 6 Signs It’s Time To Change How You Manage Field Marketers, Merchandisers and Reps, Why Retail Shrinkage Increases During The Holidays, Services Spotlight: Your Software Account Advisor Ensures Success. Planograms maximise the selling potential of your entire shelf space. Planograms, also known as plano-grams, plan-o-grams, schematics and POGs, are visual representations of a store's products or services on display. Consider all the great benefits listed above in the article, these benefits are only available either at the point of creation or if the Planogram is continually kept up to date. In order to design a meaningful planogram, you first need a rock solid assortment planning strategy. Regardless of the size of the store, retail shelf space is limited and as such a planogram is useful to plan out and maximize space. Services OverviewData Capture and Processing ServicesDatabase Management ServicesCluster ServicesAssortment ServicesPlanogram ServicesFloor Planning ServicesBusiness Intelligence ServicesRetail Advisory Services, All-in-one Category PlanningAssortment Planning Software Planogram SoftwareFloor Planning SoftwareCustom Reporting Support Options, Contact SalesBuy Online NowKnowledgebaseContact SupportDotActiv BlogDotActiv Academy. The planograms help the retailer to arrange the products in the best possible way for the customers to pick up almost everything. A pilot in selected stores is a quick and painless way of measuring the benefits to a retail operation. Benefits of Planogram Merchandising The intention of a planogram is to ensure that each retail store is optimized for sales. In simple terms, they dictate the what, where and, the how many of products on the shop floor. Automatic or manual creation of planograms. That was in the past though. Let’s unpack the short-term benefits first: While your short-term benefits can show you the power that a planogram can bring to your retail business, it’s the long-term benefits should effectively close the deal. Using a planogram in your retail store will lead to more happy customers and more sales. According to Quantzig’s retail analytics experts, "The adoption of a planogram in retail is increasing rapidly as more retailers worldwide are realizing the potential of planograms." Planogram-Online makes creating planograms a fascinating process, and the placement effectiveness increases exponentially. This is, of course, is not true. Assortment Planning, when done correctly, is done using specialised software which is connected to your planogram efforts. And don’t forget the fact that planograms can dictate the layout of your store. Product placement based on its commercial status. By analyzing past and current sales patterns, a planogrammer can make successful recommendations about the number of "facings" a certain product should have on a retail display. There are many misconceptions as to the real purpose and function of a planogram. PlanoManager’s central library allows you to search for, clone, and modify any one of the planograms you are authorized to see. Doing so is resource heavy and if you don’t have the means to do this, you’re bound to suffer. Your data will be clean and your products classified. Make sure that you don't notice any discrepancy. The planogram library hosted on Planorama’s secured cloud enables you to customize existing planograms to avoid losing unnecessary time on the creation of new POGs. Planograms indirectly also contribute in maximizing the sale of the merchandise and thus generate revenues for the store. The Covid-19 pandemic has forced retailers across the country to rethink their spaces and services. You’ll have an improved awareness of your space value as well as space return. However, like any other tool, you need to keep track of it and measure the results on a consistent basis. And that is just the start if you’re a retailer intent on providing the best for your customer. The short-term and long-term benefits of planogramming can be categorised into three main areas: Increase of Product Sales Why Planograms Are So Significant To The Retail Sales Plan. Maximize Sales. Planograms provide specific guidelines for employees to keep on top of restocking and merchandising organization tasks. In the past, planograms were manually built using your internal and external sales data. A sure fire way of ensuring this happens is through the use of the right data. After all, your supply chain is a crucial a[...]. Your assortment is the range of products that you decide to list at each of your stores. In the past, we’ve talked about using store layout and directional arrows to facilitate customer movement. *Editor’s Note: This blog article was updated on 4 July 2017 for accuracy. Layout templates and rules. Planogramming has a large variety of benefits for both retailers and suppliers/manufacturers. Planogram acts as an effective tool in the same direction. Your customers are presented with a well-organised product selection that is also visually appealing. Planograms ensure that you will be using your floor space efficiently, which will generate an overall increase in sales. 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