CPGmatters: Collaboration Needed to Enhance Checkout Merchandising
By Al Heller
Through a special arrangement, presented here for discussion is
a summary of a current article from the monthly e-zine, CPGmatters.
to a study by Dechert-Hampe & Co., 14.9 percent of shoppers
buy an incremental item at the checkout. This includes 13.6 percent in express
lanes, 15.7 percent in regular lanes, and 12.7 percent in self-scan lanes.
study, Front-End Focus: Best Practices for Superior Checkout Merchandising,
also found that 40 percent of all checkout purchases include multiple items
such as soda and a candy bar.
“We encourage retailers to cross-merchandise, mostly by suggestive signage
such as photos of people enjoying the items together. Occasion-based marketing
such as movie night at home can work as well at checkout as in the aisle with
assembled products,” Raymond D. Jones, managing director, Dechert-Hampe, told CPGmatters.com in
“Opportunities to improve checkout performance are huge. We estimate
that for any basket, the incremental sales of selling one more item is about
eight percent,” added Mr. Jones. “News developments drive checkout
opportunities. When the avian flu was a threat, hand sanitizers were hot. And
technology advances obsolete some items. Remember disposable cameras.”
Jones proposed that CPG companies assess specific brands and items for checkout
suitability: Do they have high household penetration? Are they bought frequently?
Are they impulse, or on a shopping list? (Hint: impulse is better.)
“Don’t just pay retailers to be at the checkout. If an item
suit, it won’t work and you’ll waste money,” he said. “Also
project whether checkout will generate enough incremental sales to justify
paying the allowances. And don’t place product at the front-end if it
will cannibalize inline sales.”
He added that CPG companies can tailor
item packaging to make products checkstand-ready; for instance, purse sizes
of lip balm or mascara, trial sizes of pain relievers and cold remedies, and
6-oz packages of nuts.
Mr. Jones also agreed that self-checkouts require a longer
lead-in approach for people to peruse magazines and CPG branded items, because
people no longer shop once they begin to execute their transactions. “People
go through a regular checkout in three stages — waiting, in queue placing
items on the belt, and transaction. Most impulse buys occur in stages one and
two. Self-checkout is just two stages, so you have to catch people farther
back,” said Mr. Jones.
Discussion Questions: How can stores further maximize
checkout merchandising? What are some bad habits you’ve noticed across
retail with regard with checkout merchandising?