Contemporary consumers place a high value on convenience. According to the National Retail Foundation, the majority of consumers say they value convenience more now than they did five years ago, and more than four in five consumers rank convenience as “very important” or “extremely important.”
This is one reason that modern retail stores often house a wider range of departments than their predecessors did. For example, imagine an Italian cookware store that also sells locally sourced spices, kitchen gadgets, and other finished goods—as well as offering cooking classes and hosting rotating pop-up shops. Embracing such a strategy can increase profits and improve the shopper’s experience, too.
This business approach actually represents a specific type of merchandising strategy. Here’s everything you need to know about what’s called “scrambled merchandising”—including how to evaluate if it’s the right choice for your retail business.
What is scrambled merchandising?
Scrambled merchandising (or scrambled assortment) is a retail tactic in which a retailer broadens its selection to include items not related to its primary product lines or business purpose. It can be successful for a number of different retail formats, including online and brick-and-mortar stores.
A hardware store that sells magazines, candy, and bath products is using a scrambled merchandising strategy.
Benefits of scrambled merchandising
Scrambled merchandising can help you meet more needs for a larger number of customers. Here’s an overview of the benefits:
- Increased sales. A scrambled merchandising strategy can help retail businesses meet a wider range of consumer needs, which can boost sales volumes. Carrying unexpected items can also encourage impulse buys, further increasing sales.
- Larger customer base. Offering multiple types of products can also increase the size of your customer base by helping you draw customers with different needs to your store. For example, a plant nursery that also sells candles, spices, and kitchenware offerings can attract a larger customer base than one that sells only plants.
- Resilience. Serving a broader set of needs insulates stores from market fluctuations that can affect a particular product type. For example, if an economic downturn affects the luxury makeup cosmetics market, a boutique that sells beauty-related supplements and health foods may perform better than one that relies on cosmetics alone.
Drawbacks of scrambled merchandising
Scrambled merchandising can present challenges related to understanding and managing a wider range of product offerings. Among the drawbacks:
- Inventory management challenges. Different product types may have different shelf lives and storage requirements, which can complicate inventory management tasks. A hardware store that wants to start selling fresh flowers needs to rethink its retail space, storage facilities, and shipping and stocking practices, for example.
- Inconsistent product offerings. Offering new products outside of your main line of business can lead to inconsistencies in product quality, pricing, and availability. While you probably have established relationships with reliable vendors and a deep knowledge base about your primary area of business operations, you may be less knowledgeable about ancillary product types and suppliers, making it harder to ensure quality.
- Customer experience challenges. It can also be challenging to provide quality customer service support across a wide range of product types. If your team specializes in your current assortment of electronics, for example, they may struggle to advise customers on how to pick a luxury bath bomb.
- Brand identity challenges. Holding multiple types of inventory can also confuse shoppers, and without careful planning and messaging, it can also damage a retailer’s brand image. Brands that confuse customers with their product assortment risk high inventory and the need to write off unsold products.
Scrambled merchandising vs. other assortment strategies
Scrambled merchandising is an assortment strategy—a strategy by which a business decides which types of products to carry. Here are four other popular product assortment strategies and an example of each:
- Scrambled assortment. As previously established, a scrambled assortment strategy offers products that are outside your business’s core focus. The goal is to draw in customers from outside your existing target audience.
- Deep assortment. Stores with deep assortment carry a limited number of product types and focus on offering variety within those types. A swimwear store that offers a range of swimsuit styles and carries each style in multiple sizes and colors is using a deep assortment strategy.
- Wide assortment. Stores with wide (or broad) assortments, have an extensive range of product categories but minimal products within each category. For example, a small general store may offer 200 product types but little variety within those types—such as one or two types of laundry detergent or one brand of dog food.
- Localized assortment. Localized assortment refers to an assortment based on a store’s location and the shopping habits of its customers. A general store in a ski town might carry more sunscreen, energy bars, sunglasses, lip balm, and winter hats and mittens than the same type of store would carry in a major city.
- Mass market assortment. Stores that use mass-market assortments aim to serve as many customers as possible by offering as many product types as possible and as many variations within those types as possible. They also select product types and variations based on broad demographic appeal. Big-box retailers like Target and Walmart effectively use such a strategy.
When to use scrambled merchandising
- To reach a broader customer base
- If you’ve identified an unmet need
- To become a one-stop shop
- If you’re struggling with seasonality
Scrambled merchandising can help ecommerce and in-person retail businesses boost sales and improve customer experience. Here are four signs that it might be the right strategy for your business:
To reach a broader customer base
Scrambled merchandising can help you broaden your customer base and attract more customers overall. If your business goals include attracting customers in different target markets, scrambled merchandising can help. For example, if a store that sells rock climbing and mountaineering gear wants to reach customers with a more casual interest in the outdoors, it might consider stocking car-camping equipment, lifestyle apparel, and outdoor cooking and dining tools.
If you’ve identified an unmet need
You might also consider investing in a scrambled merchandising strategy if you’ve identified a product type needed by your consumers that is not sold by other retailers who serve your customer base. For example, if the owner of a brick-and-mortar shoe store in an outdoor pedestrian shopping zone notices that no other stores in the area sell bandages, packaged snacks, or sunscreen, it might offer these items to meet the needs of shoppers spending a day at the mall.
To become a one-stop shop
One-stop shops provide value to customers through something known as contact efficiency, which is the ease with which consumers can purchase a variety of items. If your current business model and customer base suggest that scrambled assortment could make your store a one-stop shop, you might consider adopting this model. Candidates include specialty retailers that already offer a wide assortment of products and see customers on a regular basis.
If you’re struggling with seasonality
If you experience undesirable seasonal fluctuations in sales volumes, you can source products of different types to generate more consistent monthly revenue. For example, a shop that sells holiday décor might branch into picnicking and grilling products to boost sales in the spring and summer.
Scrambled merchandising FAQ
Is scrambled merchandising a good idea?
Scrambled merchandising can be a good idea for businesses that want to boost sales by reaching a larger customer base.
What is an example of scrambled merchandising?
An apparel store that offers clothing items, kitchenware products, candles, bath products, and spices is using a scrambled assortment strategy.