As we examined last time, you've started to think beyond your aisle. You're utilizing either independent market research or market basket analysis to garner the shopper's point of view. And you have a new planogram in hand. Now what? How do you convince your retailer to initiate the planogram? 

The challenge here is not only to use demand data to create planograms that are strategic, meaningful and grow volume, but to also test those planograms against a control group in order to tweak the planogram design and have the data you need to convince your retailer to adopt the changes across a chain, region or stores that cater to a specific demographic. 

As an example, Staples recently completed a year-long SKU rationalization test, testing planogram variations to see which resulted in the most sales of three-ring binders. The winner? The planogram with the least number of SKUs and greatest number of facings. What did Staples learn? That by simplifying the assortment they could present a good balance of SKUs that didn't paralyze the consumer with too many choices. 

Once you've captured the interest of your retailer with a new planogram, it's time to put it to the test. Propose a 25-store test and track those 25 stores versus a control group. The key is tracking performance on a per store basis to see how the assortment and specific items are reacting to the change. 

A sales/store/week metric can illustrate how specific items and the category as a whole are performing in comparison to the control group. If shampoo sells $25/store/week in the test group and only $10/store/week in the control group, then you know that something specific to that test planogram is helping the item sell better on a store-by-store basis. If you find that the test planogram results in $5000/store/week for the category, compared to $3000/store/week in the control group, you can then do a "what-if" analysis to determine how expanding the planogram to the whole chain would impact the total sales. 

And what about those brands you moved from the bottom shelf to the top? And vice versa. You'd expect the top brand sales to increase and that of the bottom brand to decrease. Is that the case? How does the change in product placement affect the category as a whole? And how does if affect other brands and SKUs within the category?

Also examine inventory turnover. Did the new planogram improve inventory turnover? How quickly are you selling through on-hand products? And if you integrated items from other categories, measure the affect that change has on the category and individual SKUs. 

By examining demand data throughout the testing process, you can tweak the planogram as needed during that time -perfecting the design for optimized sales. Comparing test group performance to that of a control group will also help you determine whether rolling out a new planogram makes sense for the chain, a specific region or stores that cater to a specific demographic. 

Ultimately, creative thinking backed by in-store testing will help you quickly adjust SKU placement based on consumer preferences. After all, shoppers aren't automatons. For them, the store is a holistic experience. They have an agenda when they walk through those doors -to find what they're looking for fast. You need to catch their eye, follow their logic and indulge their impulses. Play with your planograms. Use the data at hand -creatively -test your theories, tweak your designs and grow sales in your category and the larger retail environment.

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