scrambled merchandising

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FRIDAY, SEPTEMBER 12, 2008 Scrambled Merchandising You've seen it all around you now there's a term for it. Scrambled Merchandising refers to a practice by wholesalers and retailers that carry an increasingly wider assortment of merchandise. It occurs when a retailer adds goods and services that are unrelated to each other and to the firm's original business. It used to be that you went to a drug store for drugs, hardware store for hardware, a pet store for pet food and a grocery store for groceries. Now you can buy groceries at the drug store, find pet food at the hardware store and get anything you want at WalMart or Target, not to mention Zappos or Amazon. The Consumer Electronics Association presented at RetailVision results from a recent consumer survey about buying preferences: 25% would be willing to buy consumer electronics products from Starbucks, 30% from Ikea, 40% from Bed, Bath & Beyond and almost 60% from Home Depot. What does this mean for category leader Best Buy? For Radio Shack? For Circuit City? How can any retailer facing inroads from non traditional competition protect its turf and retain its customers? The answer lies in understanding how people make decisions about where to shop. Our research says there are generally two main considerations: the likelihood that the store will satisfy the requirements (i.e., Selection) and the availability of knowledgeable help (i.e., Expertise). Price, location, and loyalty are usually secondary. Last year in researching the home center market we learned that people go to Home Depot when they feel pretty confident about what they're doing because Home Depot has the best selection. Conversely, when help is SIGN ME UP! BLOG ARCHIVE 2009 (53) 2008 (56) December (5) November (8) October (12) September (12) CMOs & Marketing Accountability A Look at Home D... WaMu's Retail Bank Toxic, Too? In Retail as in Politics, Everybody Loves a Winner... Up Close & Personal at NFL Games “Value” Has Become Table Stakes Google Hiding Behind Technology Scrambled Merchandising In politics as in retail, the more channels of int... Going for "Good" Does Big have to be the Opposite of Special? 0 More Next Blog» Create Blog Sign In RETAIL HITS AND MISSES THIS BLOG IS A PLACE TO HIGHLIGHT WHAT’S NEW IN THE RETAIL CUSTOMER EXPERIENCE AND CELEBRATE WHAT WORKS ... TO CHAMPION THE RETAILERS WHO GET IT RIGHT, AND SPUR INTO ACTION THOSE WHO DON’T. Posts Comments

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  • 6/15/2015 RetailHitsandMisses:ScrambledMerchandising

    http://retailhitsandmisses.blogspot.in/2008/09/scrambledmerchandising.html 1/2

    F R I D A Y , S E P T E M B E R 1 2 , 2 0 0 8

    ScrambledMerchandisingYou'veseenitallaroundyounowthere'satermforit.ScrambledMerchandisingreferstoapracticebywholesalersandretailersthatcarryanincreasinglywiderassortmentofmerchandise.Itoccurswhenaretaileraddsgoodsandservicesthatareunrelatedtoeachotherandtothefirm'soriginalbusiness.

    Itusedtobethatyouwenttoadrugstorefordrugs,hardwarestoreforhardware,apetstoreforpetfoodandagrocerystoreforgroceries.Nowyoucanbuygroceriesatthedrugstore,findpetfoodatthehardwarestoreandgetanythingyouwantatWalMartorTarget,nottomentionZapposorAmazon.

    TheConsumerElectronicsAssociationpresentedatRetailVisionresultsfromarecentconsumersurveyaboutbuyingpreferences:25%wouldbewillingtobuyconsumerelectronicsproductsfromStarbucks,30%fromIkea,40%fromBed,Bath&Beyondandalmost60%fromHomeDepot.WhatdoesthismeanforcategoryleaderBestBuy?ForRadioShack?ForCircuitCity?Howcananyretailerfacinginroadsfromnontraditionalcompetitionprotectitsturfandretainitscustomers?

    Theanswerliesinunderstandinghowpeoplemakedecisionsaboutwheretoshop.Ourresearchsaystherearegenerallytwomainconsiderations:thelikelihoodthatthestorewillsatisfytherequirements(i.e.,Selection)andtheavailabilityofknowledgeablehelp(i.e.,Expertise).Price,location,andloyaltyareusuallysecondary.LastyearinresearchingthehomecentermarketwelearnedthatpeoplegotoHomeDepotwhentheyfeelprettyconfidentaboutwhatthey'redoingbecauseHomeDepothasthebestselection.Conversely,whenhelpis

    S I G N M E U P !

    B L O G A R C H I V E

    2009(53)

    2008(56)December(5)

    November(8)

    October(12)

    September(12)CMOs&Marketing

    AccountabilityALookatHomeD...

    WaMu'sRetailBankToxic,Too?

    InRetailasinPolitics,EverybodyLovesaWinner...

    UpClose&PersonalatNFLGames

    ValueHasBecomeTableStakes

    GoogleHidingBehindTechnology

    ScrambledMerchandising

    Inpoliticsasinretail,themorechannelsofint...

    Goingfor"Good"

    DoesBighavetobetheOppositeofSpecial?

    0 More NextBlog CreateBlog SignIn

    RE T A I L H I T S A ND M I S S E ST H I S B L O G I S A P L A C E T O H I G H L I G H T W H A T S N E W I N T H E R E T A I L C U S T O M E R E X P E R I E N C E A N D

    C E L E B R A T E W H A T W O R K S . . . T O C H A M P I O N T H E R E T A I L E R S W H O G E T I T R I G H T , A N D S P U RI N T O A C T I O N T H O S E W H O D O N T .

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  • 6/15/2015 RetailHitsandMisses:ScrambledMerchandising

    http://retailhitsandmisses.blogspot.in/2008/09/scrambledmerchandising.html 2/2

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    needed,consumerswilltradeoffalittleselectiontomakesuretheycantalktoarealpersonwhoknowswhattheyaretalkingabout.Incategoryaftercategory,wehaveseenthissamebasictradeoff.

    So,shouldBestBuybeworriedaboutHomeDepotmovingintoelectronics?Hardly.ForHomeDepottomakeagoofit,they'llhavetochangealot.Topprioritywouldbetogetmoreemployeesinthestorestoanswerpeople'squestions.ThefolksatHomeDepotarefriendlyenoughandifyoucanfindthem,theyareactuallyhelpful.Problemis,forcostreasons,employeesarefewandfarbetweenatmostHomeDepots.Eventhoughwe'recomfortablebuyingCE,westillhavequestions,oruniquesituationsthatrequiretalkingtosomeone.AslongBestBuykeepsinnovatingthecustomerexperience,theyshouldbeabletodefendagainstscrambledmerchandising.

    POSTED BY JUDY HOPELAIN AT 11:01 AM

    LABELS: BEST BUY, CONSUMER ELECTRONICS, HOME DEPOT, INNOVATION,RETAIL CUSTOMER EXPERIENCE

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