Creative, Shopper-Centric Merchandising Critical to CPG and Retail Success in 2011, according to SymphonyIRI Group

CHICAGO, Jan. 20, 2011 - The new year creates an opportunity to review product and retail strategies with a view toward continuous improvement. Nowhere is this more relevant or important than in merchandising strategies. To take a closer look at these strategies, SymphonyIRI Group released its current issue of Times & Trends, "Merchandising Trends: Achieving Differentiation with a Shopper-Centric Approach," which explores current and emerging merchandising trends that CPG marketers have embraced during the last few years in an ongoing effort to satisfy shoppers' rapidly changing definition of value.

SymphonyIRI anticipates shoppers will remain conservative in their purchasing habits, but evolve their definition of "value" slowly away from the almost singular focus on price that has shaped behavior for the past three years. The new focus will be one that integrates other factors, such as ingredients to support increased health and wellness, packaging and convenience.

"Approaching CPG merchandising from a shopper-centric perspective is critical and will become increasingly vital in the months and years ahead," says Robert (Bob) I. Tomei, president, Consumer & Shopper Marketing, SymphonyIRI. "The challenges for those leading merchandising efforts are complex and multifold, and meeting these challenges head-on is the key to long-term success. Merchandisers must understand their key consumer segments at a micro level and gauge which tactic or combination of tactics generates the greatest sales lift across key categories and brands. They must take into consideration channel and retailer-based nuances while simultaneously addressing the interplay between strategies for national and private label brands."

Also critical to the success of CPG and retail companies will be weaning shoppers off price-only related merchandising. In 2009, price-only merchandising activity increased across 79 percent of CPG categories, a figure that has moderated to a still-too-high 53 percent in 2010. Going forward, managers must rely on innovative merchandising strategies focused on a mix of feature, display and price to gain the optimum balance between attracting shoppers to the product and earning margins necessary to sustain and grow the brand.

Manufacturers and retailers seeking to maximize opportunity within the new, emerging retail environment should consider the following action items: