How might an innovative retailer with thousands of merchandise skus in a large chain of stores change almost 100% of the displayed prices for each sku four times in a 24 hour period? A typical response to this “hypothetical” question could be: “Why would any retailer want to do this?” “Surely you jest.” “Can’t be done”.
Here are the surprising facts:
This is not necessarily a “hypothetical” question. A retailer might want to create just such a promotion during this competitive holiday season.
The “Why” is obvious and there is no “jest” involved. In today’s competitive retail environment, with every retailer doing their best to maximize seasonal sales dollars, the need to build shopper traffic is more important than ever. Watch the evening news or read the local papers and you will find that shopper after shopper is focused on Store Sales in order to save money. The current seasonal forecasts expect sales to be down incrementally from last season. Every purchase dollar that can be captured looms more significant than ever to achieving gross sales objectives let alone profitability.
It “can’t be done”. Yes it can. The question however, is “at what cost?” Here is an example of the way a 24 hour - like a US “Black Friday” - promotion might be structured. The stores would sell merchandise at the “regular prices” until close of business on a given day.
Opening at say 5:00 AM the next morning, an “Early Riser” sale would offer a 15% discount on most merchandise purchases until noon.
From noon until 8:00 PM, the discount would be reduced to 10%.
From 8:00 PM until midnight the 15% discount could be restored along with in-store “extra specials” as part of a “Midnight Madness” promotion.
When the store closes at midnight the prices would revert back to the regular or perhaps a select number of “special” prices for store opening the next morning. That would come to four (4) prices promoted for the same merchandise in less than a twenty four (24) hour period.
Why even consider a promotion of this nature? Obviously to increase store traffic, attract shoppers away from the competition, make shopping available to customers who may work off hours and on and on.
If a promotion of this nature is to be truly effective and encourage the necessary customer activity to achieve the obvious volume objectives, customers, once in the store, have to readily recognize the values being offered. Here, promotional sale signage at the merchandise level becomes a critical factor. In today’s retail world, paper signage appears as the media of choice even though it is often an error-prone and costly solution.
How will a retailer ensure that the necessary signage is located in the proper areas of the store – on racks, counters and shelves, appropriately and in a timely manner so as to assure cut-off times and synchronization with the POS price files? Perhaps not an overwhelming task from close of business the day before the promotion begins at 5:00 AM the next morning. All that will require is good planning and available sales resources to place the proper signs in the proper locations. But how will the prices be managed from noon of that day until 8:00 PM that evening when the sale prices are reduced to a 10% discount level and then restored to the 15% discount level at 8:00 PM that evening? Remember, we are talking about paper signage. And then again we have to change back to the regular pre-sale prices and some advertised specials before store opening the next morning.
Oh yes: Let us not forget about any merchandise that might be transacted at a higher price or lower price than called for in advance of, or following, the promotion periods. No need to worry about any fines that might be assessed if a sign or two is out of sync with the POS price files either. After all, this is the holiday season.
If only there existed a solution that would support the immediate change of signage at the merchandise location. A solution that supported a fully graphic display technology that could utilize radio frequency communications without requiring a costly network infrastructure. A system not dependant on the availability of sales or stock resources. A system that has a proven ROI. A system that could offer retailers “electronic paper” merchandising support solutions”.
Do the preceding characteristics sound familiar to you? They do to me. They are all readily available with ZBD's electronic shelf labeling solution.
Alan Kahn
Account Director, US
alan.kahn@zbdsolutions.com