Ms. Roberts

Sales & Marketing

Tips for Successful Hotel Retail Merchandising

By Janine Roberts, Director of Sales and Marketing, Tradavo

When it comes to retail, studies clearly show, appearance really is everything! Even the smallest markets with just a few shelves and a half refrigerator can produce healthy profits and happy guests when product displays are neat, clean and well merchandised. Unfortunately, this area is too often utterly overlooked and fails to represent the quality and image the hotel achieves in every other area while simultaneously letting guests down who may be in need of a quick snack, last minute gift, or much needed headache relief after a tough day of travel. By following a few standard rules and helpful tips, you can better understand the psychology of retail and make necessary improvements to the merchandising of your hotel pantries, markets and gift shop while increasing revenue and guest satisfaction.

Understanding Successful Retail Merchandising

Rule #1: Merchandising is NOT just placing items neatly on a shelf.

Merchandising is really a science that requires an appreciation for and understanding of the buying habits of guests. This involves careful consideration of what items to offer, how to group them together, what shelf level to place them on, and what fixtures and display techniques will help achieve an organized, well merchandised appearance.

Retail is a psychology and guests can literally be turned off from a purchase by the appearance of the shelves and how the product is merchandised. Cramped bags of smashed chips, empty or sparse rows of candy bars, and haphazardly hung sundries and amenities create the psychological assumption that the products offered are old, low quality, or damaged.

Rule #2: Less is NOT more when it comes to merchandising food.

Too often managers confuse an attempt to offer neatly merchandised shelves with offering sparsely merchandised shelves. They attempt to create neat rows by placing products far apart and only offering a few items per row. While this does, at times, appear neat - it also appears fairly empty - which leaves guests thinking two things:

• Are these the last ones available and therefore the oldest ones?

• There's not a lot to choose from and they probably won't have what I am looking for.

Studies show that bountiful shelves offering a variety of products sell considerably more than half empty, albeit neat shelves. Utilizing a shelf management system that stands products up neatly in rows allows managers to achieve both goals - neatness and fully stocked rows. These easy-to-install retail fixtures make it possible to offer 10-12 candy products on a 2' wide shelf as opposed to 3-4 products when candy bars are laid down horizontally. They also keep the display looking full and organized down to the last product left in the row which minimizes the need for continuous straightening and restocking.

Rule #3: Clean. Clean. Clean.

It seems like a no-brainer, but it is shocking how overlooked the hotel market or pantry can be. Dust on shelves, soup splatters in microwaves, over frosted freezers, and general disarray is far too common in the market area - and it has proven to be devastating to both revenue performance and guest experience. A guest should never scrunch their nose at the appearance of your hotel and certainly not in a place where food and hygiene products are offered! And when they do, you can be sure you lost a sale and a return guest.

Daily cleaning of refrigerator fronts and shelving, sweeping corners of the Market, cleaning of microwaves, and overall straightening of products is a daily essential that will pay for itself.

Merchandising Tips to Achieve Retail Success: What Goes Where and Why

Eye Level Marketing

Do you know what your top two selling food product groups are? If your hotel pantry is like most, that would be chocolate bars and potato chips. So where do you want to put them? In plain view and at eye level to the average guest. Keep these products in the center shelving areas and on the upper shelves. Let the most enticing products draw guests in. Many will enter because they need a bottle of water, but when they see their favorite candy bar or salty snack offered on a bountiful shelf full of tasty snacks, you will up-sell that customer with little to no effort and double your profit.

Vertical Merchandising

When we read a book or magazine, eyes automatically scan left to right! But when shopping for food off a shelf, studies show that eyes automatically scan top to bottom. Grouping products accordingly offers guests an easy and delectable decision making display when product groups are grouped vertically. For example, if you have a 4' wide section of shelving split into two 24" shelving sections, group your salty snacks, chips, quick meals and crackers on one side. Display all cookies, candies, chocolates, energy bars and other sweet snacks on the opposite side.

Avoid flat/horizontal merchandising: Flat merchandising is the practice of laying products down is a lose/lose scenario as it limits the variety that can be offered and leaves a shelf looking empty because it does not fill the shelving unit. Display fixtures available through companies like RDC Cytex of Austin, TX allow you to stand products upright in rows which establishes a neat appearance, keeps a full looking display, and allows you to offer more products per linear foot. It also creates a fuller look as it takes up more vertical space within the shelf.

Avoid Double Facings: If you have the space to offer additional products, don't waste it by offering row after row of the same product. A wider variety offers greater sales potential and increased guest satisfaction. Ideally there should no more than ONE row of any given product - even your best sellers! Multiple rows of the same product does not increase the sale of that product.

Labels Forward: When stocking, restocking, or straightening displays make sure that all labels face forward and, when using a shelf management system, be sure all labels are standing up vertically facing the same direction. This creates a standardized, unified look that is inviting and organized and actually encourages sales.

Apples with Apples, Antacids with Antacids

Travel size convenience items and peg-able sundries and Over-the-counter Medicines are a huge seller in the hotel pantry or gift shop. These quick solutions to a forgotten razor or a much needed headache relief after a day of travel and business meetings are a substantial revenue generator for hotels who offer a well-selected variety. Companies like Convenience Valet offer the widest variety of blister pack, peg-able assortments for your guests that can be neatly hung on slat-wall fixtures or amenities cabinets. But too often managers hang all the amenities and use the left over slat-wall space to hang peg-able bags of food.

Studies clearly show that guests are less likely to buy a food product that is hung near a guest amenity or sundry because their minds automatically equate one with the other. For example: a bag of chips in close proximity to Tums or Pepto Tablets? And who wants to purchase anything to eat that is hanging next to deodorant, feminine products, or condoms? Make sure to offer amenities on a separate wall or in a separate cabinet to keep boundaries clear and sales up.

Realizing Revenue Potential

Markets and pantries are a win-win for both hotels and guests. The added revenue that can be achieved when an effort is made to offer a best-selling assortment in a neat, clean, well merchandised retail operation is a substantial contributor to Sales Per Occupied Room numbers. And guests show their appreciation for the convenience offered with steady sales and return visits! There is a substantial revenue potential that is found in your lobby shop -- do not miss out on those valuable dollars by overlooking the importance of appearance and presentation in your retail operation!

Janine Roberts, Director of Sales and Marketing for Tradavo, a retail services company specializing in design, optimization and supply needs of the industry. She works to improve retail profits and the automate management of hotel lobby shops. Janine developed and implemented the Retail Services element of Tradavo to provide hotels assistance in selecting, merchandising and effectively pricing inventory. She also created the highly successful Grand Opening Program to help general managers preparing for a grand opening and to launch their retail operation. Ms. Roberts can be contacted at 303-883-2335 or jroberts@tradavo.com Extended Bio...

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