What is joint retail trading?
Joint retail trading is a strategy for displaying complementary products alongside each other. It is also known as cross merchandising.
Why is joint retail trading important?
Joint retail trading has many advantages, including building customer loyalty and increasing sales. Visual merchandising, which is part of joint trading, is an effective way to utilize physical space in the establishment. Making good use of space, whether it’s floors, walls, counters, or store entrances, is essential for helping customers navigate and make purchases.
Who uses joint retail trading?
Joint retail trading is used to increase sales across various industries and product categories. It may be especially important for large companies such as grocery stores and department stores. However, all retailers can use joint retail trading to increase basket size and total sales revenue.
How to engage in joint retail trading?
You can start by creating an organizational plan, detailed sketch, or visual plan to display products in a way that enhances sales. A visual representation of store layout and displays can help identify the best placement for products.
Complementary products
The most common joint trading tactics involve complementary products. Products that are used or consumed together can be considered complementary products.
Topics and occasions
You can use joint retail trading to draw attention to a theme for an upcoming holiday or event. Products in this format can span multiple categories and inspire ideas or provide solutions.
Unexpected products
You can create an unexpected experience by placing contrasting products side by side. Use this approach to highlight limited-time or seasonal items like holiday decorations. Alternatively, use contrasting product displays to boost sales of items that customers may not typically think to buy together.
Alternative products
You can place a more sophisticated, higher-priced product next to a conventional product to encourage customers to purchase the alternative. Alternative products in joint trading can save shoppers time, inspire ideas, and help you increase your profit margin.
Impulse buying
Most joint trading strategies aim to increase impulse purchases. However, there are some impulse items that are seen more frequently than others.
Bestsellers
Many retailers display their best-selling products prominently. Use joint trading to place similar items next to bestsellers to boost sales of products that may not be selling at the same pace. This approach may require additional explanation from the seller.
Tips and practices for joint trading
A successful joint trading strategy requires customer research, commercial data, savvy, and logic. Each retailer has a different strategy based on location, customer behavior, and products.
Logical linking of products
Make sure customers can understand the relationship between products placed next to each other. Without a clear relationship between the items displayed together, customers may become distracted and confused.
Using furniture and displays
Joint trading works best when it is well thought out. Arrange furniture carefully so that products appear to belong to the collection. You can use product displays such as racks, tables, boxes, and display cases to implement your joint trading strategy.
Getting inspired by other stores
Research and visit other stores to see the joint trading strategies they are using. While you should not copy their displays exactly, use their examples to help inspire ideas to implement in your own store.
Promoting underperforming products
Increase sales by placing underperforming products in different areas of the store to attract more attention and help shoppers recognize the need for the item.
Displaying and experiencing products
Allowing customers to sample a product before purchase can be effective for selling cosmetics, food, and beverages. You can create a sampling station and use joint trading to display the necessary beauty products for recreating a certain look at home.
Identifying
Shopping Patterns and Understanding Your Customers
Cross-merchandising works best when your customers can see and understand the purpose of each individual product and how they can be used together. To ensure this clarity, it is essential to understand your customers and their needs.
Research and Follow Industry Trends
Staying informed about industry trends can inspire new cross-merchandising ideas. Consumer behavior is constantly changing, and meeting shoppers where they are is crucial for the success of any retail store.
How to Cross-Merchandise Online
While cross-merchandising is primarily considered an in-store sales strategy, e-commerce businesses can also utilize product placement strategies to increase average order value (AOV).
Here are some online strategies you can try:
Use Lifestyle Images
Add lifestyle images to your e-commerce store to showcase your products in real life. Create dedicated blog posts that discuss the look and link to the various products featured. Go a step further by creating collections for each look, making it easy for your site visitors to purchase everything with just a few clicks.
Complementary or Similar Product Listings on Product Pages
Add three to five complementary products in the “You may also like” section on your product pages. This is a great place to showcase additional colors or items that the customer can use or wear with the product they are currently viewing.
Product Bundling
Look at your customer data to find out which products are frequently purchased together. Based on buying trends, create bundles (or bundled products) and simply sell each bundle as one product at a combined price.
Getting Cross-Merchandising Right
There are no two cross-merchandising strategies in retail that are the same. Bundling products together to increase sales requires some testing and experimentation.
It is essential to stay abreast of customer behavior and sales data to properly execute cross-merchandising.
When done right, cross-merchandising can increase customer satisfaction, inspire ideas, and remind people of the need or problem they are looking to solve.
Source: https://www.shopify.com/retail/cross-merchandising
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