What Is Merchandising? Definition and Guide

what is merchandising

Merchandising is everything you do to promote and sell your products once the potential customer is in your store. When we talk about merchandise, we are talking about products available for sale, typically in a retail setting.

Since the sales process often starts with the eyes, retail merchandising typically involves presenting products in a visually favorable light, to try and encourage purchases.

Merchandising strategies

Some of the most popular ways to entice buyers to purchase include:

  • Window and in-store displays
  • Grouping related products together 
  • Shelf signage
  • In-store ads featuring the merchandise
  • Samples and giveaways
  • In-store demonstrations
  • Well-stocked shelves
  • Spotlighting promotional items

Don’t discount cleanliness

Making sure your products look appealing is key to effective merchandising, but how does the rest of the space look? Do customers see:

  • Clean floors and aisles
  • Dust-free shelves and products
  • Products that are neatly stacked or hung
  • A sense of organization, rather than overwhelming chaos
  • Vignettes of related products set up together to suggest how they might be used
  • Enough elbow room to move about comfortably

Benefits of merchandising

Some small business owners hire professional visual merchandisers to come in and spruce up their displays and selling floor, finding that the cost is well worth it. But merchandising goes beyond just moving inventory around, to space planning and product staging. Effective merchandising yields:

  • Higher sales
  • Faster inventory turnover
  • Buyers who spend more time in the store
  • More satisfied customers
  • Increased customer loyalty

Stores that present products that customers are frequently looking for in a pleasing display, or tucked away neatly, will find those same customers returning for more on a regular basis.

Merchandising FAQ

What do you mean merchandising?

Merchandising is the practice of promoting a product or brand through the use of advertising, promotions, and other marketing techniques. It is a key component of any retail business and is used to increase sales and create brand recognition. Merchandising includes activities such as product placement, store displays, promotions, pricing strategies, and more.

What is merchandising in media?

Merchandising in media is the practice of creating, marketing and selling products or services related to a particular media property or brand. This includes producing and selling merchandise such as toys, clothing, and collectibles based on a movie, TV show, book, or video game. It also includes creating digital content and experiences such as virtual reality experiences and interactive websites.

What are the 5 P's of merchandising?

  • Planning: Establishing the goals and objectives of the merchandising strategy and developing a plan to achieve them.
  • Positioning: Crafting a clear, compelling positioning statement that differentiates the product or service in the mind of the customer. 3. Promotion: Developing and executing marketing tactics that will drive awareness and demand.
  • Pricing: Setting the right price point to maximize profit and appeal to the target customer.
  • Placement: Ensuring the product is placed in the right locations to maximize sales.