Product Adjacency:
a strategy for increasing sales
What does Product Adjacency mean?
Strategically placing complementary merchandise in close proximity in a retail setting to encourage consumers to purchase additional items.
How does this differ from cross merchandising?
Designed to encourage impulse buys, cross merchandising is a retail display strategy that places related products together in one display. The products generally go together in an obvious way, like chips and salsa, toys and batteries or matches with candles.
Cross merchandising makes the shopping experience more convenient for your customers as it remind them of additional items they may need or encourages them to buy a little something extra.
Product adjacency is a bit more creative and includes less obvious and more substantial add-ons. Both techniques involve storytelling, but product adjacency is more suggestive, telling a broader story and may include merchandise from unexpected departments or categories.
In the image above, a customer who came into the store to purchase some new towels for an upcoming pool party, may have purchased towels, new table & chairs, cushions, a tray and some lanterns upon seeing this display.
Contrasting the techniques is best explained through examples:
A gift store may have a display table of summer-themed merchandise that represents a poolside motif with suntan lotions and hand-held mini fans added as impulse items. This is cross merchandising.
The same store may have a display table that expands the summer theme into a collection of merchandise that reflects a poolside oasis. Higher-priced impulse items suited for this display may include a set of melamine serving dishes, swimsuit coverups, Caddis sunglass readers, hair protectant oil and Sea Bags beach totes. In other words, things you may need to host or attend a pool party. This is product adjacency.
In either case, a customer who comes in for a beach towel or a sun hat is presented with other items they may want or need. When presented effectively, cross merchandising and product adjacency each result in increased sales, but the product adjacency approach tends to yield a larger average order value.
Another example:
A hardware store sells moving supplies like boxes, tape and bubble wrap. A talented merchandiser might create a product adjacency display that includes those items plus command hooks, furniture dollies, house numbers, temporary window blinds, furniture moving pads and jazz up the display with colorful welcome mats and mailboxes with change-of-address forms spilling out for fun.
A side benefit of product adjacency is more elaborate and interesting store displays. I refer to them as inspirational or lifestyle displays. ~Becky Tyre, Retail Details
Advantages of both cross merchandising and product adjacency displays:
Enhance customer convenience by making it effortless to find related items
Make gift-giving quick and easy
Encourage multi-item purchases
Educate customers on styles and trends
Educate customers about new products in a category
Encourage impulse purchases
If you get creative with product mixes that are logical — but not always obvious— the result will be interesting merchandise displays that increase sales.
Stay retail inspired, friends!
~Becky Tyre, Retail Details