Pharmacy Merchandising. Features and Types of Product Placement
Merchandising is a set of measures to promote products and attract customers to purchase to increase profits. Merchandising activities determine the techniques of successful product sales, as well as preparing the products and the shelves for sales. Merchandising is based on the rules of product presentation, formed on the basis of customer behavior. Merchandising principles work not only in-store chains and supermarkets, but also in pharmacy chains and single pharmacies. Pharmacy merchandising has a lot in common with supermarket merchandising. However, there are a few differences.
The specifics of merchandising in pharmacies are related to the characteristics of both the products and the sales floor. Merchandising is only applicable to OTC (over-the-counter drugs). Additionally, in the case of the limited area of the sales floor, there is no room to use a lot of promotional materials.
For merchandising in a pharmacy, it is important to create the right attractive display to attract the customers' attention and adhere to all pharmaceutical standards. In particular, not to break storage rules and pharmaceutical regulations.
In retail pharmacies, effective merchandising is a key tool for stimulating sales. The core objective of merchandising in pharmacies is not just to drive sales and increase profits, but to promote products and enhance customer loyalty.
The major requirements for pharmacy merchandising:
- Minimum customer efforts to find the right product (easy access to products in an open type of display).
- The layout should be attractive and encourage sales.
- Medicine should be placed in groups by storage characteristics and in accordance with all the regulatory requirements.
Open and Сlosed Layout
Pharmacies with an open-type display (with free access to goods) with a large floor space use the merchandising principles inherent in retail stores.
Horizontal layout. Products are presented along the full length of the shelf and are divided by type and trademark/brand. For example, the layout of cosmetics can be divided by shelves: on one shelf the hair care products, on the second - face care, on the third - body care cosmetics. In the horizontal layout, the strongest places are in the center of the shelf and on the right from the center. They are also called "golden". Therefore, the most profitable goods are placed in the center of the shelves. As a rule, more expensive items are placed on the right, and cheaper products are on the left from the center.
Vertical Layout. A method of displaying products in several rows vertically from top to bottom. The "hot zones" of the layout are placed at eye level and hand level. The weakest places with the lowest sales are at foot level and head level.
Layout in blocks. The products are laid out in groups arranged in a block. For example, the layout by manufacturer, brand, or pharmacological group or by the method of taking the medicine. The blocks are arranged either horizontally or vertically.
In fact, there are general rules for distributing goods by height. Take into account the height of the average customer here. According to statistics, 65% of women and 35% of men are most likely to visit a pharmacy. If the average height is 1.6m, the most profitable shelf is at a height of 1.2-1.6 m from the floor.
The layout on the shelves at foot level - the distance from the floor is about 0.2-0.6 m. This is where large-size items (e.g. baby diapers) are placed.
Lower hand level, distance from the floor 0.6-0.9 m. Here should be placed bandages and basic necessities.
Upper hand level, distance from the floor 0.9-1.1 m. At this level, it is appropriate to place seasonal items and widely advertised products (for example, cold and allergy remedies), as well as discounted items.
Eye level or "golden shelf," distance of 1.2-1.6 m. This is the shelf with the highest sales and income. New items or discounted goods are displayed here. The layout at this level usually provides 40% of all sales.
The customer's attention works on the same principle as reading a book - from left to right. In the same way, clockwise, a person most often moves around the sales floor. Therefore, products located on the right side of the entrance, as a rule, are not in great demand. The same goes for shelf space. Products at the beginning and at the end of the showcase shelf remain unnoticed by the buyer.
Some customers choose their own over-the-counter drugs in pharmacies, but at the same time, they do not always understand what kind of medicine they need. Therefore, analogs of drugs from different manufacturers could be placed on the shelves of one display case and the customer gets the opportunity to choose.
In pharmacies with closed-type displays (in closed showcases) the presentation of goods should be limited to more than two faces. In the limited space of the sales area, more than two faces may give the impression of a minimal assortment.
When designing the checkout area in pharmacies, merchandise is displayed in small packages with a colorful design to stimulate impulse purchases.
It is important to follow certain rules for displaying goods in the pharmacy. Note that some types of merchandise are placed separately in the sales area:
- drugs, dietary supplements, and medical products;
- prescription and non-prescription drugs;
- internal and external medications;
- drugs are grouped by pharmacological action.
Other rules of merchandising in the pharmacy:
- adherence to the color scheme;
- arrangement from left to right: from light to dark shades;
- drug packages are laid out "on the front" side;
- alternation on the shelves of expensive drugs with cheaper ones;
- observance of cleanliness and integrity of the packaging;
- all items on the shelves must provide at least a three-day supply;
- the price on each package on the left side;
Each group of medicines on the shelves should contain a rubricator headline. It should be clearly visible, and it is better to avoid using special medical terms - the customer should understand what kind of drugs are in front of him.
Note that merchandising in a pharmacy is effective for displaying over-the-counter drugs in the sales area. Therefore, there are some limitations in the use of merchandising techniques in the pharmacy. Merchandising does not apply to prescription drugs, cheap and unknown drugs, and overpriced items.
Merchandising in the pharmacy is carried out following certain rules and in accordance with the scheme - the planogram of product display.
What is a pharmacy planogram?
A pharmacy planogram is a road map of your drugstore that shows the correct placement of drugs on shelves and displays. It is a layout of the product display that shows in detail where each product is placed on the retail fixtures in the pharmacy.
Three factors must always be taken into consideration when creating a planogram: the requirements of the suppliers, the capabilities of the pharmacy (retail space and equipment), and customer behavior.
The planograms in the pharmacy allow you to adjust the process of laying out and monitoring its effectiveness. It is an opportunity to efficiently place each product, optimize shelf space and think through the layout to increase sales.
With pharmacy planogram analysis, you can easily identify the most popular items and track customer behavior. Find out which drugs are in high demand and which are not. You can use PlanoHero service to create a planogram, manage your product assortment, do product rotations, and determine your inventory quantities. This is a tool for merchandising automation, that helps to customize the whole process: from creating a pharmacy floor plan, fixtures, and retail planogram to sending it to the pharmacy and monitoring its compliance. The service also allows you to get analytics on the pharmacy floor plan with a heat map to determine the areas with the highest and lowest customer traffic.
Here are some top tips for pharmacy merchandising strategies:
- Keep things in order. Keep all products in their proper places.
- Place merchandise in a way that boosts sales and doesn't break storage rules.
- You can't have effective sales without thoughtful merchandising.
- Use a planogram. Automate the planogramming process for the entire pharmacy chain or individual drug stores.
- Monitor the execution of planograms in the pharmacy and analyze sales.
Merchandising is essential to a successful business. Merchandising in the pharmacy is the art of effectively displaying merchandise to customers in order to increase pharmacy turnover and profits. Pharmacy merchandising is the promotion of over-the-counter drugs, general medical supplies, and other related products.