Successful Merchandising for Digital Channels

Catalog University Pub Talk

Larry Shaw, Dean of MerchandisingJune 3, 2015

Who Am I

Dean of Merchandising at Catalog UniversityFounder and CEO of Merch Success, a full-service merchandise solutions

company for retail, catalog, and e-commerce companies Merchandise strategic planning and analysis, and finding, developing, and curating

new unique and interesting products for catalog, retail, e-commerce companies

25 years executive merchandising and marketing positions at leading companies, including Southern Season, The Vermont Country Store, and Nordstrom

What Will Be Covered

Differences Between Catalog Merchandising and Digital MerchandisingKey Factors for Successful Digital ProductsQuestions and Answers

Catalog vs Digital Merchandising

Catalog• Products part of assortment

• Long time to market

• Long selling cycle

• 100% of product sell visible

• Older audience

• Smaller number of items

• More Triples and Home Runs

Digital• Each product is stand-alone offer

• Quick time to market

• Short selling cycle

• Only partial product sell visible most times

• Younger audience

• Larger number of items

• More Singles and Doubles

The Most Critical Product Elements1. Product “Thumbnail”

2. Product Name

3. Price

4. Customer Reviews

5. Data Tags

Continuous New Item Introductions

• New products #1 reason for digital repeat visits• The top source of Ecommerce, E-mail and Social content• Speed to market is the new currency

• Products have more competition quicker with shorter life spans

• Cycles need to be Daily or Weekly, not Seasonally• Correlated with customer age, as younger = quicker• Need on-line production cycles and processes, not catalog

Demonstrate Products• Digital is visual media

• Younger audiences are “Missouri” – show me• Video and audio, product details, in use, diagrams

• Can raise sales by 2x or more• Need own production process with different expertise

• Interesting & effective more important than production quality

• Need a brand Point of View/Editorial Style• Post on own website and 3rd party sites like YouTube

Account for Small Pixel Size

• New marketing vehicles and access methods have tiny “selling” space• Re-targeting, Facebook ads, display ads, mobile offers• Have to convey what item is, or intrigue, in just small image, maybe a headline or

price• Driver is click, not buy

• Intrigue people to find out more details• Don’t have real control over where/when show up

Pinterest and Instagram• Increasing amount of digital exploration happening visually

• Becoming key way younger generations discover brands

• Great way to test products and concepts and get feedback

• Organize by themes, collection, and how people think

• Supported by data tags and analytics

Customer Mindset Organization• Primary entry and launch page is still Home Page

• No longer about just Product Category• Age driven: Older = Traditional Structure Younger = Explore• Organize by how customers think and shop, not internal structure• Collections and Themes, What Other People are Wishing For, Top Rated,

Newly Arrived• Two main benefits

• Help customer find item they are interested in quicker• Stimulate browsing and discovery

Price Competitive

• Assortment level, not just individual items• Strongly impacts overall brand perception• Drive product choices, as all items go on-line

• Competitive = mode, not lowest• value that appears most often in a set of data

• Need an overall Price Competitive Strategy• Match MSRP, at price vendor selling at, at mode, no more than 10% higher

than lowest, ….• Item price more important than shipping cost

• But both are looked at• Transform items through unique product names and images

Questions and Answers

Key Info

Contact me with feedback or questionslarry@merchsuccess.com802.379.5802

Sign Up for Classes at Cat U: http://cataloguniversity.com