Several retailers and jobbers may still be in an era where in-store merchandising efforts equate to ensuring all shelf space is utilized, regardless of its rhyme or reason. But when stores are cluttered and items are hard to find, you risk losing customers, especially first-time visitors exploring your stores. Toy retailers think of their stores as adventures and do what it takes to ensure visitors have a positive experience.
Child’s play
So what does marketing to children have to do with making your store(s) more attractive? You might be surprised.
To get some ideas, visit the nearest Toys “R” Us (TRU). You’ll see boutiques like Animal Alley, Tonka Truck Stop and Imaginarium. TRU U.S. President of Merchandising and Marketing James Feldt says the stores are broken down into four key merchandising worlds –– R Zone, Seasonal World, Learning World and Boy’s & Girl’s Core Toys. This arrangement allows for separate and distinct sections within the store, giving Toys “R” Us more intuitive product placement and providing shoppers with a higher-quality experience. How the “worlds” are connected and arranged is still a work-in-progress, but what is important is that TRU relies heavily on input from customers to fine-tune the floor’s layout.
Gary Silva, senior vice president of sales, U.S. Auto Parts Group at Genuine Parts, agrees with this premise and says utilizing research is key. NAPA doesn’t have a cookie-cutter layout but builds stores based on market need, with each designed independently. “If an area has more do-it-yourselfers, we’ll design a store with a bit more retail floor space,” says Silva.
This type of research and evaluation is important and forces NAPA to understand the needs of each of its markets. But with more than 6,000 stores, Silva admits it can be somewhat challenging. “It would be easier if all the stores had the exact same layout, but it’s not the right thing to do for independent owners because some areas have more professional customers, and others have more do-it-yourselfers,” he explains.
Toys “R” Us has proof that this kind of research is essential to growing a business and increasing traffic. For example, studies showed that shoppers who bought items in Imaginarium — a section that sells educational products — also were likely to purchase items in the preschool area. TRU responded by connecting the two with an eight-foot access aisle. “It’s about making the store a destination,” says toy industry analyst and industry renowned Toy Guy Chris Byrne. “The hands-on experience when somebody walks into your store is one of the most compelling factors in determining a sale — regardless of whether you sell automotive parts or kids toys.
“In merchandising, getting off-shelf is critical. Because we are a very visual culture, you have to transform the shelf so it’s experiential.”
Today’s automotive shoppers are smart and savvy and — regardless of what they come in looking for — need visual stimulation. Sections and categories must make sense or confusion will kick in, and customers will walk out.
Toys “R” Us is a giant compared to the floor space most automotive retailers and jobbers have, but the concept of giving various sections unique names and using creative signage to draw a visitor’s attention to the right areas of your store has some merit. Advance Auto Parts recently announced it’s spending $4 million to remodel 49 Advance Discount Auto Parts stores in the Orlando area with improved product adjacencies, high-impact signage and enhanced systems that offer more convenience to customers.
You can even take cues from mass marketers that sell toys, like Target. The retailer substituted the letter “Z” for the letter “S” on signage and displays to build on the current popularity of toys like Bratz, Diva Starz and Finger Jamz. The discount retailer now has a “Kool Toyz” section, complete with neon-lit signage and gigantic pictorials of toy selections that can be seen from what seems like a mile away.
For a similar effect at minimal cost, you can team up with vendors and manufacturers who have point-of-purchase material, educational displays and signage. Interactive or computer-operated shelf talkers or kiosks are also useful since they give customers an opportunity to play and interact. Think about arranging products by category if you don’t already, and connect aisles if it makes sense. Products for dressing up the inside of a vehicle — seat covers, custom steering wheels, window decals and storage containers — can make for a creative arrangement with the right point-of-purchase and shelf displays, while a connecting aisle can accommodate all the products needed to keep the interior clean.
Just remember that not all change has to be drastic. Byrne says to walk your aisles and take a close look at how products are organized — even small changes can make a big difference. Toys “R” Us recently began displaying books by their front cover instead of just the spine, which was forcing shoppers to cock their heads to read the title. This simple modification resulted in more book sales.
Space invaders
Steve Alexander, owner of Automotive In-Store Marketing, is all too familiar with the issues retailers and jobbers face. His company is 100 percent dedicated to serving the in-store merchandising and marketing needs of retailers, jobbers, service providers and product manufacturers in the automotive aftermarket. “Because auto stores have so many different types of products, much finer attention must be paid to separate products and categories,” says Alexander. Everybody in the industry needs to do a better job in this area, though he points toward several companies, like O’Reilly Auto Parts, that have been aggressive in their efforts.
“Many locations severely lack on-shelf educational materials. Packaging has become more colorful and educational, but now includes too much copy,” he says. Manufacturers are trying to fit every bit of information on the packaging since most retailers are hesitant to accept the vendor’s point-of-purchase materials and signage. Alexander says many stores have come to the conclusion their brand name is more important than the brand names of the products they sell and that this mindset can be costly — quickly resulting in confusion and information overload for customers. He suggests bringing the details of a product or category to the consumer consistently at the shelf’s edge or via overhead space. “It’s just not happening as much as it should,” says Alexander. “All the air is free and it gets thrown away.”
If space is limited, look at different ways to merchandise to your customers. KB Toys is a much smaller toy retailer so it focuses heavily on attracting impulse shoppers, using the front of its stores to demonstrate and showcase hot new toys and games. A customer may come in for a planned purchase but walk out with more. KB also prominently displays clearance and closeout items near its registers.
Several auto retailers and jobbers already realize the importance of impulse buys. Both Advance and Auto Zone stores have lots of barrels and carts near their registers with automotive trinkets and discounted items. Are the latest products at the front of your store? Do you have end caps that feature what’s new? If an item is merchandised and displayed well, it may drive an impulse sale, regardless of what the shopper originally was seeking.
Think ‘BIG’
Tom Hanks played a child in a grownup’s body in the movie “BIG,” yet was able to quickly secure a job with a toy manufacturer and become vice president of product development. He was a typical 12-year-old who truly knew what toys would fascinate kids. You too need to think like your target audience(s) in order to be successful.
“One of the biggest mistakes adults make in the toy business is that they try to impose their perception on children,” says Byrne. “You have to truly understand how your customer is relating to your store or your product and what it means to them.”
This problem may also ring true in the aftermarket. Just because an organization thinks a product or display is cool doesn’t necessarily mean customers will agree. You must do your homework. With such a changing dynamic, it would be detrimental to assume you know the average DIYer or professional technician. The aftermarket caters to a wide range of personalities: young import tuners, heavy-DIY baby boomers, light DIYers, women, new drivers and the list goes on. Delving into your customers’ mindset must occur at every level in your organization from the president and CEO to the store manager and sales staff. This is especially critical for employees who interact with customers on a daily basis. They really need to understand the customer, know what they are looking for, how they like to be communicated with and what in-store marketing tools will interest them.
Alexander solidly agrees, and says the industry needs to take a step back and look at what it’s doing. What should be happening and what is happening aren’t quite lining up. “What I see is a cyclical function that comes from a certain mentality. Some retailers and jobbers think, ‘We got bigger, we became stronger and we think we got our customer base pretty well locked up,’ but it comes to a point where stores become sterile,” he explains. “Falling back and dining out on your past success while the dynamic of your customer base changes means that eventually, you’ll lose out. Retailers should pay more attention to the psychographics of their target audience.”
Look at any potential target audience as a gateway to future growth. For example, young import tuners and other recently licensed drivers offer a huge opportunity to increase sales and store traffic. Do what you can to reach out to them. Perhaps after-school discounts, weekend car shows and a wider selection of import accessories and performance-oriented products will draw them in.
Licensed to thrill
One reason Wal-Mart has a grasp on the toy industry is partially due to its relationship with studios that produce popular children’s movies and their licensees. Specialized end caps and shelf displays in both Wal-Mart and Toys “R” Us have featured “Masters of the Universe,” “Harry Potter,” “The Hulk,” “X-Men United” and “Finding Nemo” memorabilia, books, apparel and games. With licensed product on shelves in a timely fashion, these toy retailers have the merchandise to go with the craze if a movie makes a big splash.
Quick to jump aboard this highly-successful bandwagon, the drug store chain Walgreens teamed with Universal Studios Consumer Products to bring more than 100 co-branded products into stores featuring characters from movies like “The Land Before Time” and “Jurassic Park.” These exclusive deals between movie studios and retailers are fairly common in mass merchant and apparel channels, but they’re something new for drug store chains and could indicate the start of a trend in other industries, including the aftermarket.
Advance Auto Parts and Pep Boys took advantage of programs offered by Hot Wheels after the movie “The Fast & the Furious” introduced the import tuner market to mainstream America. Adding collectibles that relate to the automobile industry just might make for cool displays and great add-on sales inside the store.
Even if the idea of teaming with movie producers and licensees to merchandise branded automotive products seems out of your realm, there are still components of this concept you can use to market to your customers. According to research, many DIYers enjoy sports and outdoor activities, such as football, racing and hunting. Why not use these seasonal events to create themed displays? During football season, tailgating items could be placed on a truck’s tail bed in front of your window. You could offer tailgating tip sheets along with Sunday discounts. When racing kicks off, checkered flags, cardboard cutouts and high-performance products might make for a unique in-store display. You may even want to think about selling apparel like NASCAR hats and shirts if research shows the majority of your customers are fans.
If you think these ideas are great, but are wondering how to roll out drastic changes across all your stores, you will be happy to know there are companies that would love to do your dirty work. Senior Vice President of Sales & Marketing Steve Workman at National Marketing Services (NMS) in New Jersey says his company supports manufacturers and retailers in initiating any in-store activity that needs to be executed. “We’ll set up displays and fixtures, move or reset products, hang signage, build promotional displays and check inventory levels.” If you’re juggling hundreds or thousands of stores, this type of service is for you.
Workman says they’ve been servicing Pep Boys for just over a year, rotating products and servicing fixtures. NMS also has worked with Toys “R” Us for more than 18 years. “TRU keeps a very close watch on what’s happening inside its stores to ensure everything is coordinated,” he says. “To keep outlets fresh, they have us rotate products weekly, and sometimes daily, depending on the time of year.” Not enough companies are doing this. Instead, they rely on store managers to ensure that the appropriate planograms, displays and signage are being utilized, but more often than not, stores are not executing what needs to be done to keep from becoming stale.
Workman cited a study conducted by Point-of-Purchase Advertising Interna-tional (POPAI) that found approximately 70 percent of point-of-purchase materials sent to stores end up in the trash. “It’s at POP that people make a final buying decision, but retailers and manufacturers usually don’t realize this until after the fact, so we end up coming in during crisis mode. Preparation and planning need to take place upfront,” he says.
Educational toys = sales tools
Many toy retailers host events in an effort to increase store traffic and product sales. Toys “R” Us offers birthday parties and Camp Geoffrey play days to draw in customers. Kids learn crafts like creating kaleidoscopes and tissue-paper flowers. “The basic premise is that most won’t come in and walk out empty-handed,” says analyst Byrne.
We don’t think your visitors would benefit from learning how to create their own mini-safari animal (though they might enjoy it), but they may be interested in how-to clinics like cooling system maintenance, wise car waxing practices and shock inspection and installation. Most DIYers learn by trial and error, and would likely appreciate your help in becoming more acclimated to vehicle maintenance. You may have to invest in instructors and demonstration displays, but in many instances, vendors are willing to sponsor these events with product samples and other merchandise.
The investment will be worth it. Attendees will frequent your store and likely generate additional sales. Some light DIYers may even turn into heavy DIYers with your help. Leave flyers at the register and in other high-traffic areas so your customers know what classes are available.
If you’re a jobber, you stand to benefit from offering courses to your professional customers too. They may not need training on installing spark plugs or filters, but they may appreciate a course on how to up-sell or how to teach drivers about the importance of brake maintenance.
Netting in customers
With almost 100 million Web users, it would be wrong to underestimate the power of the Web. It goes without saying that most people shop and browse online. In fact, one study noted that at-work users rate the Web as the number one resource for information on new products by an average of two-to-one versus other channels. That means most people are likely to visit your website before they even set foot in your store. Your online merchandising efforts must be up to par. If visitors don’t like what they see in the first few seconds, they will go elsewhere. Just think about what you do when you’re in that situation.
Toy retailers are ahead of the e-business curve. Toys “R” Us teamed with Amazon and rumbled across the Web with a force, allowing moms, dads and kids everywhere to shop by age group, category and brand — all from the comfort of their own homes. Toysrus.com was selected by Internet Retailer magazine as one of the top 50 retail sites due to its online strategy and astonishing growth. In only three years, the customer base increased from one million to more than nine million. “Toysrus.com has put together a winning combination by capitalizing on its brand’s merchandising expertise while leveraging Amazon’s best of breed technology for site operations,” says Kurt Peters, editor of Internet Retailer. This past November, KB Toys followed suit and became the exclusive toy provider for buy.com, a site that traditionally sold computer software and hardware, electronics, music and DVDs. The company claims sales increased 10 percent as soon as toys were added to their repertoire.
“Selling online allows retailers to reach potential customers that may not even be in the same time zone, something that was not feasible a decade ago unless they spent tens, if not hundreds of thousands of dollars on a mail-order business model,” says George Roberts, co-founder and chief development officer of Crucial Networking, LLC, a Connecticut company specializing in Web solutions for small businesses. “Having inventory online affords retailers and jobbers the ability to be flexible on pricing and to automatically up-sell customers on other products without being pushy. They can also gather valuable demographics from online order forms that they cannot get in the store at their cash registers.”
For jobbers wanting to focus on professional customers, no area is growing faster than business-to-business e-commerce, which accounts for about 90 percent of online sales according to the U.S. Department of Commerce. Can your customers order products 24 hours a day, seven days a week at the click of a mouse and without hassle?
“When a visitor has a bad experience online, or if your company comes across as unprofessional, that lessens their confidence in you and can translate into more than just a lost online sale, but a lost store visit as well,” says Roberts. “Would you duct-tape a homemade, hand-painted sign to your building?” Hopefully, your answer is, “No.” So why would you have an outdated website cluttered with information?
“Your website is a branding tool,” he says. “It is as essential to your success as your business cards, your signage, your flyers and any other promotional material used inside the store.”
Think outside the box
The automotive aftermarket cannot survive if it gets treated like a commodity market — retailers and jobbers need to create a perceived need for the products that aren’t always needed. This is true in the toy industry as well, so retailers are forced to think outside the box. KB Toys cracked the traditional mold when it teamed with Sears for the “toy store within a store” concept. KB helped Sears expand its toy selection without increasing overhead. They even entered a trademark agreement to create Craftsman-branded toy tools for tots. KB is now an integral part of Sears’ catalog and Internet business, serving as the exclusive toy supplier for Sears’ Wish Book and sears.com.
Toys “R” Us also broke free from its confines and set up shop in a Giant Foods supermarket. Branded toys are located between the grocer’s diaper/formula and cereal/candy aisles. This type of action begs the questions –– what type of in-store merchandising can you take out of your store? It’s time to start playing around with some of these ideas because sales opportunities abound.
