Addressing Shoppability Issues To Drive Sales

Fine-tuning the design of the frozen department can bring significant sales increases, said Rajeev Sharma, chief executive officer, VideoMining Corp., State College, Pa.

Category insights derived from research into shopping patterns have shown that changing the sequence of products result in a 10-15% sales lift in that aisle, he said.

Using as many as 150 ceiling-mounted cameras in a store, VideoMining captures the in-store path to purchase of over 10 million shopping trips of individual shoppers, with on-site servers converting the images into data, which is later combined with point-of-sale data. “We then generate data for all the categories within frozen, as well as other categories within the store, so we can understand what is good and not good about each of the aspects of the behavior of shoppers,” Sharma said. Among the supermarket retailers participating in VideoMining’s ongoing research are Kroger, Safeway, Ahold, Giant Eagle and Schnucks. The company also runs a parallel study of convenience stores.

VideoMining turned its focus on frozen sections when, in the course of doing other research, it learned that there were issues with shoppability — that is, navigation and selection of products. This is more complicated in frozen because of merchandising that requires shoppers to look through glass to see the product and then open a door to make their selection. However, it is critical to resolve because frozen is trafficked by more than 40% of shoppers, making it one of the most visited departments in the store, Sharma said.

A primary question to be asked is: “What is the cost of shoppers browsing and then leaving?” For every 100 people who enter a supermarket, 38 visit the frozen aisle, with 22 actively engaging with product and 16 just passing through without stopping, according to VideoMining research. Of the 22 who stop, 17 convert into buyers, while five leave without buying, which Sharma describes as “leakage.”

This results in a numerical conversion rate of active, engaged shoppers into buyers. “The 78% conversion rate for frozen is pretty good compared to other departments in the grocery store. In some departments, like health and beauty care, it is as low as 20%,” he said.

“However, if you look at the 22% who shop and leave, that amounts to a very significant loss of sales because the average basket contribution by frozen is pretty high,” he said. Frozen represents an average $113.38 in revenue dollars, and $28.87 in leakage per 100 shoppers, according to VideoMining statistics.

“That’s the amount that is the low hanging fruit, because if you designed the footprint better, and convert the 22% who shop and leave into buyers, then you can cut into that leakage,” Sharma said.
Two ways to address this in the frozen section are through improving space organization and through navigational assistance to shoppers, he said. In some retailers, the need for this became apparent because of the excessive amount of time people were spending navigating the aisle and looking around. Some would just give up and leave, Sharma said. Better visibility of products, which involves high-quality doors and LED lighting, is a major factor in helping shoppers find what they need.
In terms of organizing the department, products that are likely to be cross-shopped should be near each other, such as entrees, vegetables and desserts that would be part of a meal solution purchase. “Once you are opening a particular door and shopping for an item, related products should not be far away.” Although it may not be make practical for the products to be adjacent, they could be placed across the aisle, or the retailer could use signage or cross-promotional material to encourage the purchase of complementary items. “If you have complementary items in two different aisles, it’s not going to help,” Sharma said.

One of VideoMining’s most noteworthy findings, which is true for all categories, is the importance of repositioning popular, price-sensitive products to the middle of the aisle, Sharma said. These may have been placed at the front or back of the aisle with the idea that more shoppers would look for them there, and then proceed further into the aisle. The research showed people don’t shop that way, Sharma said.

“We found that many people don’t like to stop at the first 3 to 6 feet of an aisle. It’s counterintuitive because most manufacturers probably want to be in the front or the back in terms of placement, but our data shows that shoppers don’t like to stop there, and many times, they just simply miss whatever is there,” he said.

Grocery shoppers are “mission oriented. They tend to grab whatever is on their list and then go.” If the faster-moving products are on the end, and the shopper happens to see them, they will go further into the aisle. By putting the faster moving products in the middle, it forces the shopper to pass higher-margin premium or impulse items on the way in or out of the aisle to get the item on their list. Signage may be needed to get the shopper’s attention. “So our goal should be to maximize the exposure of premium and impulse products. That leads to aisle flow design and placement of products in the proper sequence,” and to sales increases of 10% to 15%, he said.

The effective use of the limited number of end-caps in typical frozen departments was also studied by VideoMining. “Our understanding was most of the products are on end-caps because they are on promotion. So how much variety do you want to keep there? We looked at many different combinations of products and different numbers of products, and we found that the best practice is two different types of products. With more than two, people get confused and the productivity of the end-cap goes down,” he said.

The productivity of end-caps is not just measured in sales from the particular case unit, but whether the display encourages people to go into the aisle, he noted. “Many times we found people come and look at the end-cap display, and then went into the aisle and shopped for the same product, buying it there.”

Sharma sums up: “Our findings showed that frozen is of high interest in the grocery channel. Our data shows that people who come to frozen are very motivated. Frozen offers one of the biggest opportunities in the store because of that interest and the dollar value involved.”

Reprinted from www.supermarketnews.com

Automated Upselling On The Customer Display

How would you like to use your POS system to advertise while your customers are in the check out lane?  If you have the Toshiba/ACE or Toshiba/SMS system with the Java GUI (Graphical User Interface) customer screen you can change the pictures on the right-hand side of this display. 

 

You can place pictures along with messages on the customer display for promotions and/or services that you provide to your customers.  You can also have different screen configurations display at different times during the check out process.  To generate income you can have your vendors advertisements appear on the customer screen.  One import thing to keep in mind is that the more pictures you place on the screen, the more register resource it takes to run.

If you have the Toshiba/ACE system you do not need to know HTML or how to crop picture files to create you display for the customer screen.  STCR’s ACE Java Screen program makes it easy for you to update and manage these displays. STCR ACE Java Screen runs on the Windows PC and is connected to your POS network. 

If you have the Toshiba/SMS system, you may have the Advertising Module.  With this licensed module you also are able to place pictures along with messages on the customer display for promotions and/or services that you provide to your customers.  As with the ACE version, you can display different pictures during different stages of the checkout and tendering process.

For more information, please contact your STCR sales representative at (607) 757-0181.

Introspection: Six Tips to Self-Improvement

Productivity and organizational growth work hand in hand to create a strong relationship.  To put it simply, the productivity of a company’s employees measures their effectiveness and efficiency in performing their day to day tasks.  Sometimes however, these lines become blurred and their description feels too broad, making it difficult to find practical methods for improving productivity.

The corporate environment in every industry is becoming increasingly challenging. This cold hard fact suggests a constant need for employees to strive to achieve greater productivity in their daily work.  Here are six tips to help you increase productivity.

#1: Personalize Agendas
Employees who develop their own daily agenda typically perform more resourcefully than those who are provided with a rigid schedule to follow. In order to keep a schedule each day, we can simply jot an "activity list" on a piece of paper which can easily be referenced throughout the day.
#2: Clump Small Tasks Together
Every working individual has a list of routine tasks to be performed on a daily basis. In just a few minutes, you can break down each responsibility into small tasks. When each requirement is taken on as a set of brief tasks, it's sensible to pick out and "group" the related items together. This prevents us from having to jump back and forth to the similar duties, hampering productivity.
#3: Monitor Agendas
During a busy work day it is very easy to steer off the beaten path.  When this happens it takes longer to recover and get back on track.  Employees often find it helpful to prepare a schedule that he or she can follow through out the day.  Once a set task is finished simply cross it out and continue on with the rest of your list.
#4: A Clean Desk Equals a Speedy Train of Thought
An untidy desk seems to have an impact on the owner's thought process. More often than not, finding things lost in the clutter also becomes time-consuming. However, there are some employees that firmly believe that they're more comfortable having a relaxed and casual way of working. The items on their desks aren't always a mess, and might actually be placed in a way that's easily accessible to them.  Either way, the number of things spread around the desk should be neatly placed, rather than in a clutter, in order to expressively reinforce work principles.
#5: Finish Disliked Tasks Quickly
Procrastination settles in during a regular day at work for several reasons. One common problem is the requirement to complete least-favorite tasks. The best way to put an end to procrastination before it even comes into the picture is to complete the tasks that we dislike. As soon as those are done, the remaining day becomes less challenging or more exciting, with greater productivity.
#6: Revitalize at Lunch or Dinner Hour
With increasing pressure at work, many people ignore breaks completely.  Taking a proper break for a meal offers positive medical and psychological advantages.  The practice of taking proper breaks from work is the best way to get an instant energy boost for the remaining workday.  Also if you can, go outside and take a short walk and get some fresh air.  This will help get your blood flowing and take your mind off of work for a few minutes. 
Using these six helpful tips will not only help productivity at work but will also make you a happier and more valuable employee.

PCI Security Revisited for 2014

While the new PCI 3.0 requirements take effect on January 1st, 2014 existing PCI 2.0 compliant locations will have until January 1, 2015 to make the necessary changes to meet the new requirements.  The new version of PCI has three types of modifications.  They are clarification, additional guidance and evolving requirements.  As part of the new document there are several places where clarifications are included to assist with compliance. 

One of the points outlined in the new version of the PCI requirements is meant to clarify the common misconception that using a PA-DSS POS application guarantees that you are PCI compliant.  This is mentioned in the PCI V3.0 document where it says: “Use of a Payment Application Data Security Standard (PA-DSS) compliant application by itself does not make an entity PCI DSS compliant, since that application must be implemented into a PCI DSS compliant environment and according to the PA-DSS Implementation Guide provided by the payment application vendor.”  The POS application is part of 1 of the 12 areas of PCI compliance.

These are the 12 major areas of requirements for PCI compliance

1. Install and maintain a firewall configuration to protect cardholder data

2. Do not use vendor-supplied defaults for system passwords and other security parameters

3. Protect stored cardholder data

4. Encrypt transmission of cardholder data across open, public networks

5. Protect all systems against malware and regularly update anti-virus software or programs

6. Develop and maintain secure systems and applications

7. Restrict access to cardholder data by business need to know

8. Identify and authenticate access to system components

9. Restrict physical access to cardholder data

10. Track and monitor all access to network resources and cardholder data

11. Regularly test security systems and processes

12. Maintain a policy that addresses information security for all personnel

For further information and documents please visit the www.pcisecuritystandards.org website.

Have You Checked Your Backup Lately?

In the wise words of Ben Franklin ‘an ounce of prevention is worth a pound of cure’.  A good backup/recovery solution for mission critical systems is an ounce of prevention crucial to any business owner.  The pain of a hard drive failure without a good backup could include irrecoverable data loss and avoidable, excessive downtime; both of which can prove to be very expensive and detrimental to you business.  Not only are you likely to incur the obvious expense of required emergency services, but even more costly is the lost revenue and customers associated with unnecessary and extended down times.

STCR provides a full backup/recovery solution to all our customers, yet having a solution in place is only the first step.  Routinely ensuring the backup tasks completed successfully is the second step and should be a high priority for every store.  Some solutions are automated yet they too need to be inspected periodically.  It would be a mistake to assume a backup will be there when needed only to find out, when it’s too late, it’s not.  There is no better way to protect your investment and minimize potential down times, due to a hard drive failure, than consistently confirming your backups are completing correctly.  This way you can be proactive and call the Help Desk if there are any issues. 

If you don’t know if your system(s) are backing up or even how to check, please call STCR’s Help Desk at (607) 757-0181.  One of our friendly, professional Retail Systems Analysts will be happy to assist you.  Let us help you prevent the costly mistake of not periodically verifying the backup solution is working effectively.

Go Above The Advertising Noise

There is no escape from advertising and commercials in our daily lives.  From the moment you turn on the TV, pick up a newspaper or drive down the highway, there are advertising and marketing signs everywhere.  Imagine if you live next to a busy street, the noise level would probably bother you when you first moved there.  But over time, you would probably get used to it.  Consumers are experiencing the same effect by all the commercials and marketing programs they are faced with daily.  The intended purpose of these marketing efforts is often lost.  So how does one get above the noise?

One of the strategies is to personalize the marketing materials to the targeted consumers instead of blasting generally targeted ads.  The company needs to first identify the consumers who are most profitable.  The company should create a multi-dimensional profile of their customers and not just looking at what they are buying, but also what they may be thinking of buying and how they are behaving online.  As the growth of e-commerce and social media continues, information about consumer habits outside of the traditional brick-and-mortar store is increasingly more valuable to marketers.  This information, analyzed correctly, could help companies get to know their consumers and personalize ad campaigns to create more sales and customer loyalty.

This may seem simple but the biggest challenge for a company is to know who its customers are and what their needs are.  Without the correct information about their customers, a company’s ad campaign could easily miss its intended audience.  It’s a known fact that about 20% of a company’s customer base brings the greatest profit and about half are only marginally profitable.  The challenge is for the advertising effort to reach out to those customers who are most likely to drive in the maximum value to a company.  Another strategy is to look into consumer behaviors beyond the past store purchases.  This is referred to as a multi-dimensional consumer profile.  Online behavior and past purchases could help to determine buying patterns more than just purchase history alone.  With increasing number of people engaging in online activity and social media, it is important for marketers to not rely on one facet only to predict consumer behavior.  When these information are processed correctly, consumers gets the benefit from being offered goods and services that they are looking for and companies profit from advertising dollars well spent.