Retail Merchandising Execution Gaps

It’s estimated that every year consumer packaged goods manufactures launch over 50,000 promotions with retailers. These records for more than 20% of their income, considerably higher in some item categories. However, it is also estimated that 40% of these promotions fail to achieve their goals and are judged a failure.

What amount of this failure rate is due to over-ambitious goal setting? How much is the result of poor design? What amount is brought about by incapable pricing strategy or unfortunate timing? How much is from a combination of all three? It’s hard to measure in light of the fact that each market, advancement and retail climate is so different. However, in hindsight most failures can be pinpointed to an unforeseen gap in the execution of the promotional strategy at the store level.

Retailers and manufactures invest so much time and money developing in-store merchandising and promotions. But, one key angle that is often overlooked is the execution of the program’s installation as it reaches each store. On the off chance that an execution plan is missing, many things can go wrong that have a negative impact on the uniformity of the program and the overall sales performance.

Accordingly, many creative and expensive in-store merchandise plans fail to achieve their projected ROI because of mistakes that are made during installation or maintenance of key program components. These may include poorly set planograms, improper display installations or missing place to checkout materials. These mistakes are examples of “execution gaps.”

An execution gap is any implementation issue or problem that has a negative impact on the integrity of a merchandising program. A hole can go from mis-shelved products to poor sign placement or be pretty much as damaged display components, or most importantly, a missed installation deadline. There are many models and each are avoidable with proper planning and attention to detail before installation begins on the floor.

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