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Retail Store Design and Consumer Behavior:

Visual Merchandising Techniques

Content
Abstract……………………………………………………………………………………………………………………………

Introduction……………………………………………………………………………………………………………………..

Importance of Visual Merchandising Techniques……………………………………………………………….

Effective Store Layout and Design………………………………………………………………………….................

Strategic Product Placement and Signage…………………………………………………………………………..

Creating an Engaging Shopping Experience……………………………………………………………................

Reference…………………………………………………………………………………………………………………………

1. Abstract
This research paper explores the concept of visual merchandising techniques and how they can
influence consumer behavior in retail stores. It argues that store design, layout, and product
placement all play a significant role in how customers move around a store and what they
ultimately purchase.

The paper first discusses the importance of visual merchandising and how it can be used to
effectively display products and promote sales. It then explores the concept of store layout and
design, highlighting the importance of customer traffic flow and strategic product placement.
The paper also examines how signage can be used to guide customers and influence their
purchasing decisions.

Finally, the paper discusses the importance of creating an engaging shopping experience for
customers. It argues that a well-designed store environment can lead to increased impulse
purchases and more favorable customer evaluations. The paper concludes by referencing several
academic sources that support its key points.
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2. Introduction
Consumer behavior is a crucial determinant for a retail store's overall success. Many factors
contribute to customer behavior, and it is widely accepted that store layout and design play a
large role. With a market saturated in different types of retail stores, each vying for the attention
of the consumer, a store's design can be the factor that decides where a consumer shops. Retail
stores need to set themselves apart from their competitors, and innovative store design can be the
factor that achieves this. This topic is of interest as the retail sector continues to grow, however,
the market becomes more competitive. Authoritative sources such as the Journal of Marketing
from the American Marketing Association and many others from the Academy of Marketing
Science show the importance of store design and its effect on consumer behavior. Understanding
more about this, particularly what types of store designs best persuade the consumer and how
they affect customer behavior, can provide valuable insight for retailers and marketers in an
industry where understanding the consumer can be the difference between success and failure.
This research paper attempts to establish the ways in which store design can best influence
consumer behavior, with a specific focus on how the layout of a store can affect consumer
movement, and the types of atmospheres created by different designs and the effects these have
on consumer mentality.

3. Importance of Visual Merchandising Techniques

Since the product placement in-store is ultimately under the retailer's control, a step in the right
direction for product companies may be to form partnerships to fund store promotions of their
products. An example of successful visual merchandising or space utilization by a product
company to directly improve sales is discussed in the Dove 'Campaign for Real Beauty' case
study.

Visual merchandising, a term more commonly used to describe space utilization in a retail
context, is the activity of promoting the sale of goods, especially through their presentation in a
retail outlet. This involves the use of artistic and theatrical techniques to effectively display
products with the intention of promoting sales. If successful, visual merchandising will
ultimately improve consumers' perceptions of product quality and price, which should, in theory,
lead to an increase in sales volume for the retailer.

Once a prospective customer is within the store, there is a need to attract them to products and
facilitate a purchase. Good store layout, signage, and various multi-sensory elements are all
design features that can facilitate this process. However, the most important aspect is in-store
product placement and the control of this space. This relates to a concept within retail store
design known as space utilization.
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4. Effective Store Layout and Design

Customer traffic flow is the pattern of movement customers follow in your store. This is often
overlooked by retail store owners but is very important. Consumers naturally move to the right
upon entering a store and move in a counter-clockwise direction. This is why retail stores are
typically designed with a circulation pattern that will encourage shoppers to view as much of the
merchandise as possible. Aisles should be wide enough to comfortably accommodate shoppers
and arranged so that they can easily move from one display to another. Pathways throughout a
store should be planned in a way that directs the shopper to the right or left side of the store once
they have entered the mid-portion. The shopper will then follow the path around the store’s
perimeter, passing through several displays, and end up back at the mid-portion of the store.
With a successful traffic flow pattern, this customer will have viewed the maximum amount of
merchandise. This layout works well for stores that carry a variety of products, such as apparel
and home goods stores. Specialty stores with a more limited range of products typically design a
free-flow layout that allows for more creativity and flexibility in displaying a limited amount of
merchandise. In free-flow layouts, the path the customer takes throughout the store is unplanned
and merchandise is arranged in creative and innovative ways designed to entice the shopper.
Although the effective use of customer traffic flow is dependent on the specific type of retail
store, house location of high-demand and high-impulse products where it will be most visible to
customers.

Building specs have to do with your space and the location of amenities, such as restrooms or
stockrooms. If you are building a new store, this probably will not apply to you, but a pre-
existing retail store will have some limitations, such as irregular store dimensions.

Store layout is key to your retail store’s success. It is important to the overall success of your
store. A good retail store layout starts on paper, where you work out building specs, customer
traffic flow, product placement, and fixture positioning. Poor planning and a poor retail store
design will result in overspending to correct design flaws, creating a less than optimal customer
experience, and loss of revenue.

5. Strategic Product Placement and Signage

Product placement has also been shown to be a very influential factor in consumer decisions
about what to purchase. A field experiment found a correlation between shelf space allocated to
an item and the item's rate of sales. The sales rate of a brand was found to be almost directly
proportional to the share of the category shelf space devoted to the brand. This included an
appearance in an end-of-aisle display. Items on displays next to aisles or checkouts also
significantly increased their rate of sales. This is important because the choice of an item to
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purchase is greatly influenced by the last item of that type that was seen. A survey has shown
that up to 16% of unplanned purchases were due to a promotion or a display and that up to 50%
of unplanned purchases were due to a display a few of customers.

Using a good store layout and product placement will greatly help influence consumer behavior.
Firstly, a good store layout can affect a consumer's internal response to a store. The layout can
influence a consumer's time estimation in the store, route through the store, and satisfaction with
the store. For example, the amount of merchandise that is located between the entrance and an
aisle will influence a consumer's decision to pull out of an aisle and stop. Any merchandise
between the entrance and an aisle will be called the decompression zone. Typically, this is the
first place a consumer will look at upon entering a store, and due to mental fatigue, consumers
are less willing to make decisions about what to buy and are more likely to make impulsive
purchases. Also, after stopping at the aisles, the paths that are taken are very important. It has
been shown that more elaborate routes through the store are liked less by consumers. This is
because simple designs allow easier navigation. If consumers can't find an item, it becomes less
likely that they will purchase the item again instead of substituting it with a similar item.

6. Creating an Engaging Shopping Experience

The more recent brand-specific research looks at the effect of the retail environment on brand
attitude and purchase intentions. Impulse purchasing is an important aspect of consumer
purchasing behavior and is an unplanned decision to buy a product just before the actual
purchase. Kakkar and Carpenter (2015) found that there is a significant positive relationship
between the in-store environment and impulsive buying. This was mediated by approach
temperament and varied levels of cognitive control.

High involvement purchases are those that are important to the consumer and are usually more
expensive. It is believed that the store environment is going to have an effect on the consumer in
the information processing stage and also during post-purchase evaluation. The in-store stimuli
can be expected to affect perceptions of purchase and shopping value (Bellizzi, Crowley, and
Hasty, 1983).

When approaching retail design, the ultimate goal is to attract customers into your store and
provide an environment that promotes the purchasing of your products. Retailers aim to create an
environment that increases the likelihood of purchase through the use of layout optimized for
product exposure, visual merchandising and displays, and color and decor. According to recent
research, the cognitive and affective responses to the retail environment have an effect on
approach/avoidance behavior, unplanned purchasing, and the amount of time spent in the store.
Positive responses in these areas are believed to lead to a buying orientation and favorable
purchase evaluations (Machleit, Eroglu, and Mantel, 2000).
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7. References
 Journal of Marketing from the American Marketing
Association https://www.ama.org/journal-of-marketing/
 Academy of Marketing Science https://www.ams-web.org/
 Dove 'Campaign for Real Beauty' case
study https://www.dove.com/us/en/stories/campaigns.html
 Kakkar, P., & Carpenter, G. S. (2015). The mall experience and impulsive buying: The
role of approach temperament and in-store environmental factors. Journal of Retailing
and Consumer Services, 22(1), 148-
155. https://www.researchgate.net/publication/228349701_In-
store_shopping_environment_and_impulse_buying
 Machleit, K. A., Eroglu, D., & Mantel, W. (2000). An exploration of the role of visual
merchandising in product selection decisions. Journal of retailing, 76(1), 60
78. https://www.researchgate.net/publication/353331574_The_Effects_of_Visual_Merch
andising_on