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How to Use eCommerce Merchandising to Boost Holiday Sales

Posted by Ellie Ho on

How to Use eCommerce Merchandising to Boost Holiday Sales

The holiday sales are upon us and you want your online store to use digital merchandising to maximize profit this year. With COVID-19 putting a spanner in the global economy, small and medium-size businesses will be relying on holiday shopping to boost revenue for the coming year.

Ecommerce merchandising, also known as digital merchandising and online merchandising, is an effective way to promote products and increase the average order volume of your store. We’re going to break down what eCommerce merchandising is, why it’s important, and how you can use it to get more sales this holiday season.

Shoppers are expected to stay home this holiday season - a trend that’ll likely continue in years to come.

What is eCommerce merchandising?

Ecommerce merchandising is the practice of showing products in the right place at the right time on your online store to increase purchase probabilities the chance of someone buying it. You’ve seen merchandising throughout your life - think of product placement in movies, or just how the aisles in a supermarket are arranged.

Ever notice how the items you need from the supermarket, like bread, milk, and eggs, are always placed close to each other? Or how sale items are always at the front of the aisle? This is merchandising. The supermarket wants you to buy more things so they group similar items and make promotions stand out.

Ecommerce merchandising is essentially the same as this, only it takes place online. Some examples of digital merchandising in an eCommerce store include:

  • Showing promotional banners
  • Boldly displaying sale items on the homepage
  • Highlighting particular merchandise in the search box
  • Grouping similar products together to encourage cross-selling
  • Following up with site visitors to offer discounts on products they’ve viewed

Digital merchandising takes many forms, but the ultimate aim is always to drive up sales of a particular product or group of products. This is usually done by showing products in a creative and engaging way to capture attention and interest.

SEO and ad campaigns bring people into your store, but it’s merchandising that makes your products sell. Everything from where you feature your collections to how you design your product pages relates back to merchandising.

5 R’s of merchandising

A great way to think about eCommerce merchandising is by employing the ‘5 Rs’, also known as the 5 Rights. This is having the right product in the right place at the right time in the right quantity, for the right price. This is textbook stuff that you’d learn in any business class.

holiday shopping with ecommerce merchandising

Recreating the benefits of in-store merchandising online can be tough - but it's totally possible.

  • Right merchandise: The first step to successful merchandising is to choose the right products to promote. This is where research and data analytics come into play. You need to know what shoppers want, which means knowing the current trends in your space. Give the people what they already want - don’t try to be a trendsetter.
  • Right place: Where you show the product will determine how much attention it receives. You might want to highlight a bold sale on a collection as your hero image on your homepage and then feature your new product underneath this. Think about what people want to see when they land on your website.
  • Right time: Timing is key when merchandising. You wouldn’t sell summer clothes when going into winter, would you? Make sure you’re showing products that are relevant to the season and people’s spending patterns.
  • Right quantities: Being an eCommerce merchant means striking the delicate balance of selling more products and not having them go out of stock. You need to pool your data to project how much stock you’ll need for each product you’re going to be merchandising. Running out of stock means losing revenue while having too much stock could lead to losing money later on down the line.
  • Right price: You need to make a profit, but the customer wants to get a good deal. Striking a balance between these two ever-present factors is never easy. Make sure you regularly check your competition to ensure you’re not being too far undercut.

Relate back to the 5 Rs of merchandising when choosing where, when, and how to promote your products and collections to ensure you make the biggest impact.

Simple and proven ways to sell more with online merchandising

You understand what digital merchandising is and how you can use it. Now we’re going to look into some simple and effective steps to help you understand how to merchandise to sell more products during the holiday shopping 2021 season.

1) Build a familiar store layout

Have you ever walked into a supermarket and thought ‘where the hell am I and how do I find what I want’? Probably not, because they all follow a similar layout that you’re instantly familiar with. It’s a floor plan that has been shown through tedious trial and error to produce more sales.

lorier watch store layout familiar

Watch retailer Lorier keeps things familiar with the cart and search in the top right and collections boldly merchandised throughout.

Your eCommerce store should have its own flavor, but it should still be familiar enough for visitors to navigate it as second nature. For example,

  • The main menu should generally be at the top of the page
  • The search bar should be in the top right or top center
  • The privacy policy and FAQ should be in the footer section
  • The cart button should be in the top right

This is what people expect, and most people don’t like surprises.

Keep navigation simple and intuitive

Take all the guesswork out of navigating your store so visitors can spend their attention on the products you’re merchandising. Simple and intuitive menu navigation is a must. You should only use a mega-menu if you have a large store with dozens of product categories - otherwise, stick to a simple menu.

Use cues to direct shoppers to where you want them to go. Call to action (CTA) buttons or banners for promotions will help you direct some of that stray attention in a more profitable direction.

shopify landing page without navigation menu

Shopify removes all navigation on their landing page to draw all attention to its 14-day Free Trial CTA.

Remove navigation on landing pages

Note that removing menu and footer navigation on landing pages can help to capture users in a sales funnel. This tactic should only be used when you’re actively trying to close one specific type of conversion and nothing else, for example, selling a product or collecting email signups.

Having a familiar store layout allows you to insert product merchandising much more effectively and divert more user attention to it as a result.

2) Group similar products

Certain products were made to go together, like toothbrushes and toothpaste, cameras and lenses, cleanser and moisturizer, or even diapers and beer according to one old story. You can use Google Analytics to see which products your customers often buy together and then group them in a special promotion.

Check out what your competition is doing as well and try to group as many similar products as you can. This is known as the art of cross-selling. If I buy a shirt from your store, don’t just let me check out with that alone, offer me a tie to go with it!

lumin skin holiday shopping product set

Skincare brand Lumin offers practical product bundles on skin maintenance sets to save customers money.

Successful digital merchandising takes full advantage of the ability to place products in front of the shopper at any stage of the sales journey. This is a luxury that brick-and-mortar stores don’t have.

Use free shipping with bundles

Entice your shoppers by offering free shipping or a discount when they buy two or more similar products together. This is a great way to increase your store’s AOV (average order value).

Upsell when possible

If your customer doesn’t want to buy anything other than what they already have, then try and sell them a more expensive version of what they want. This is known as upselling and it’s a very effective technique to use on product pages. Suggest similar but more premium products to the one your prospect is looking at and hope that they bite.

PRO TIP: Always have the option to buy products in a bundle separately. This shows the user that they can actually save money with the bundle. Bundles of products that cannot be purchased individually show no cost-saving benefit to the customer.

3) Get personal with customers

You don’t have the luxury of face-to-face meeting your site visitors and building relationships with them. BUT you do have analytics and automated email software. Get your visitors to sign up with their email to receive a discount or loyalty points.

Then, set up your automated email or SMS software to send them a message if they come to your store but don’t buy anything. Something like:

“Hey John, this is Claire from Alpine Style customer service. I noticed you were looking at so-and-so products but left without buying. We’re putting a 15% discount on that next week but I can apply it for you now if you put in the promo code 15OFF at checkout. Have a great day!”

This kind of outreach converts very well.

Don’t be afraid to merchandise your products in emails to prospects. Even with the advent of social media, email marketing is still one of the highest converting merchandising tools.

accenture personalization data

Personalization makes customers feel valued and increases conversions - use it with your Christmas marketing and Black Friday marketing. Source: neilpatel.com.

Personalization has been shown to increase conversions by around 20% and is now becoming the standard across industries. You can use data to go further than just addressing users by name (although this is a great place to begin personalization). Consider the user’s previous browsing and shopping history to show them relevant products and consider the timing of each promotion.

For example, if I buy a toothpaste expected to last two months from you, then show me more offers for toothpaste after around six weeks to capture my attention once again.

4) Use the search box for merchandising

The search box is the often underrated star of your eCommerce website’s navigation. You can use merchandising in the search box to promote products similar to the ones users are searching for. There are different types of merchandising when using a search box, the two main ones are:

Rule-based merchandising

This is where you attribute a set of rules that determine which products show up and when. Its benefit is that you don’t have to place products manually and can rely on data-driven algorithms to do the work for you.

Rule-based merchandising allows you to promote or demote products automatically at different times of the year to reflect holidays and seasons, or you could continuously promote popular products in certain categories.

product ranking for ecommerce ranking

Product Filter & Search allows you to set up product rankings to do merchandising on search result pages.

The Product Filter & Search app from Boost Commerce allows you to set dynamic rules on your search bar function that drive up conversions and the customer experience.

Keyword-driven merchandising

This is when you promote specific products in reaction to certain keywords that a user types in the search box. For example, when I type ‘winter jacket’ you might choose to show me a best-selling raincoat as well.

Up to 30% of shoppers use the internal site search when looking for products. On top of that, conversion rates are around double for users who find the products they’re looking for through search. You’re missing out on conversions and an increased average order value if you skip over search box merchandising.

Keep in mind common and trending product combinations when choosing what to promote and what to assign to rule-based merchandising.

5) Use CTAs and signage to draw more attention

Brick-and-mortar stores are full of signs and cues to get people to where they want to be. Your online store should make use of signage and cues as well. The best way to do this is to use arrows, leading fonts, and bold colors around CTAs.

hm sholiday shopping banner

Fashion retailer H&M goes bold when it comes to pushing their Black Friday marketing. Try and tell us that doesn’t stand out immediately!

It’s important not to clutter your store with too many images and signs, but the occasional banner and sign pointing to a call to action button is a must. You’re trying to get the user’s attention, so use simple and to-the-point signs.

Point customers to a sale, a popular collection, or encourage them to use your search box and then incorporate the aforementioned search box merchandising to catch the conversion.

Visual cues are important because they work. Our visual perception is very target-oriented - it’s why photographers often use ‘leading lines’ to direct the eye to the subject in their photo. Use your signage and arrows to direct your visitor’s eyes to the products you’re merchandising.

Final thoughts

With the holidays fast approaching, the time for optimizing your eCommerce store is now. Set up rules-based merchandising in your site-search, add more promotions and create visual cues to draw more attention to them, and pay careful attention to your data analytics to see what the trends are and what your customers want.

Consider the 5 R’s every time you make a promotion - the right product in the right place at the right time in the right quantities at the right price. Do it in the right way.

Happy holidays!