Imagine walking into a store, eager to purchase a specific item, only to leave empty-handed because you couldn’t find it. Sound familiar? This common frustration highlights a significant issue in retail: poor visual merchandising. A recent study by GlobalData and One Door revealed that U.S. retailers lost $125 billion in sales over the past 12 months due to ineffective visual merchandising, accounting for over 3% of the entire physical retail market. Mid-market stores experienced the highest losses at $54.1 billion, however, luxury retail stores, discount stores and needs-based retailers experience the same consumer trends and frustrations.
Visual merchandising and retail design is important for stores as it helps customers navigate the store easily and use fewer mental resources to find products. It also significantly impacts the overall shopping experience by creating an inviting atmosphere and showcasing products effectively.
Examples of Poor Visual Merchandising
Hard-to-Find Products: When items are not where customers expect them to be, or when store signage is inadequate, shoppers can become frustrated and abandon their search.
Cluttered and Disorganized Displays: Messy or overcrowded displays can overwhelm customers, making it difficult to locate items and diminishing the overall shopping experience.
Uninspiring Displays: Boring or outdated displays fail to capture customers’ attention, reducing the likelihood of impulse purchases.
Worn-Out Fixtures: Damaged or outdated fixtures can convey a lack of care, leading customers to question the quality of the products offered.
Key Findings from the Study
Consumers Left a Store
49% of consumers left a store without making a purchase because of poor visual merchandising.
Not Satisfied
73% of consumers are not completely satisfied with how products are displayed in stores.
Report Being Frustrated
33% of consumers report being frustrated by products being hard to find.
Families Left a Store
66% of consumers with families left a store due to poor merchandising.
Cart Abandonment
Over the past year, 49.9% of consumers left a store without making a purchase because of poor visual merchandising. Following such experiences, only 51% of shoppers are likely to visit the store again.
Customer Dissatisfaction
A staggering 73.4% of consumers reported not being completely satisfied with in-store visual merchandising.
Most Common Frustration
The most common complaint related to poor merchandising, cited by 33.3% of consumers, was difficulty in finding products.
Demographic Insights
Gender Differences: Men generally have a lower tolerance for shopping inefficiencies. Approximately 55.2% of men left a store due to poor merchandising, compared to 44.3% of women.
Family Dynamics: Consumers with a child under 18 years old living at home abandoned stores at a higher rate (66.6%), likely because of time constraints and the need for efficient shopping experiences.
Age Factor: Younger shoppers, particularly those aged 25-34, were the most likely to leave stores with poor merchandising, with nearly 24% having done so in the past year.
It’s well known that good merchandising can drive sales, but the reverse is also true — poor visual merchandising is highly damaging to the revenue line. Consumers these days are time poor and have a low tolerance for friction in stores. Retailers that make life difficult with messy displays, hard to find products, or excess clutter are driving their consumers to shop elsewhere.
Neil Saunders
Managing Director Retail, GlobalData
What Does This Mean for Retailers?
To mitigate these challenges, there are a few things retailers can do to improve the overall customer experience and mitigate profit loss. First, stores can take an honest assessment of their store and declutter and organize their retail spaces. Maintaining clean and organized spaces to is one thing stores can do to improve the shopping experience and best of all, there is little to no investment required.
Another thing retailers can do is implement clear and attractive retail store signage and update fixtures to improve product visibility and accessibility. Shoppers want to use as little mental energy as possible to find what they need and clear, consistent signage is an important factor to help customers find their way. Stores can also look at their layout to ensure easy navigation and, more importantly, make sure products are located in an area where customers expect them to be. For example, milk and yogurt are typically found in the same area of grocery stores.
“For years, retailers have implicitly understood the linkage between great visual merchandising and sales results, but no one has ever really measured the impact,” said One Door CEO Tom Erskine. “As retailers look to prioritize their investments, this data will shed light on the potential downside of cutting corners related to the in-store experience.”
Next Steps
Retailers can no longer afford to overlook the importance of effective visual merchandising. With billions of dollars in potential revenue lost caused by disorganized displays, unclear signage and confusing store layouts, the impact on customer satisfaction and sales is indisputable. By making strategic improvements — such as decluttering spaces, updating retail signage and optimizing their retail store design and layout — retailers can create an engaging shopping experience that drives sales and customer loyalty. Don’t let poor visual merchandising cost your business valuable revenue. Reach out to 40 VISUALS today and discover how we can help take your store merchandising, displays and custom signage to the next level!
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