Blog for Retail


The main-yet-unseen factor of every successful merchandizing factor must certainly be the shelving process. For those who didn’t understand, the shelving process is a small algorithm that is run along with the process of merchandising a certain described product, by analyzing the suitable shelf position and angle for the product. As easy and non-malignant as it sounds, almost 46% of active stores across the world have always messed up a certain level of promised sales increase that they gave to their clients. The main reason behind this is as transparent as glass, hence it gets unnoticed — A RIGHT SHELVING PROCESS.

Now before we step into the “what’s”, we must reason out the “how’s”. Every retail store has an eye for this very common adjunction, and that is to lure the customers with the usual grocery-first template and lose out on making the bigger cut by leaving out the major gold-stock at the back of their stores. Similarly, there are also the main factoring questions that raise a whole new set of parameters to this shelving process:

· How much space does the store have?

· What type/brand of products does it gets stock/withhold?

· What is the total number of units [of the product(s)] the store intends to stock?

· What type of shelving will show off the implied products in the best way?

· When and how does the store would need more shelving in the future?

The size of your store dictates how much space is available to work with, the products that your store stocks will have a direct influence on the retail shelving you choose to implement, the weight of the products is an important factor to consider when deciding on what shelving to implement, the shelving angle differs for every product to display and when selecting the retail shelving you wish to implement, you should also consider the future.

Now the investor, the businessman, and the retailer are all indeed the major stakeholders behind executing a prompt answer to these questions, and this is where Xtract does the job of giving a latent and accurate service. For example, one fast-moving consumer goods (FMCG) client found that instead of segmenting by banner or channel, clustering stores by square footage and geography or some combination of the two is more meaningful when configuring their merchandising strategy.

The landscape of any super-market today is characterized by a proliferation of the given SKUs (Stock Keeping Units), a vast increasing number of smaller stores in the vicinity, and the shrinking total available shelf space. Shoppers tend to spend less and less time in front of a shelf for long. CPG companies invest a lot in creating the “scenario of successful grab”, being a set of shelf standards that enable them stand out from the crowd, grab shoppers’ attention and convert categorized “window shoppers” into potential buyers.

A scorecard of a retail chain (or compliance score) is always computed of multiple drivers or KPIs, such as shelf position, brand blocking, brand adjacency, shelving flow, pricing execution, brand recognition, and product availability. Without access to granular store-level data, it’s really hard to perceive. Every channel and banner operate variably, and the shelving principles that work in a certain store may not work in another. Once the stores of a retail chain are aggregated into clusters with similar compliance scores and sales performance, you can examine which specific KPIs would impact the charts with the most of each node.

Let’s suppose a manufacturer found out that prescribing similar shelving principles to Store A and Store B that were both in the same channel produced greatly varying results. While shelf flow was the most important driver of sales in Store A, it had little impact in Store B, where brand adjacency had a much greater effect. So, you could figure out how indifferent the branding can signify to be in this case, hence you must identify and prioritize the shelving principles that are most impactful in particular stores to optimize sales.

There are two keys to any kind of shelving process deadlock in the modern methods — that being the shelf data and analytics. These are the areas that has unmatched expertise from Xtract. Very often, data reveals that no two stores are equal, and so CPGs cannot have a one-size-fits-all approach for the total outcome. By knowing what drives sales in which stores, you can make more informed decisions on what to activate, how and where. By monitoring in-store activities and shelf changes at scale and leveraging complex computational principles, we have developed methods of extracting and structuring huge volumes of shelf and sales data that help our clients spot patterns and predict outcomes faster than competition.

What we were capable of delivering in Xtract was the enabling of the clients to create cluster-by-cluster action plans for every node in the retail chain, providing clear priorities for their field sales team to focus on in-store. If a sales rep had only 15 minutes in a particular node (i.e., a store), what drivers would they focus on the most?

In the above case study, this cluster-based approach achieved:

· 9% overall dollar lift (ODL) for a category/brand of items

· About $250M opportunity for a brand/category

· 2% lift on MDR (multipack dollar raise)

New AI-powered data streams in the “Xtract” sleeves are delivering unprecedented and lightning-fast intelligence solutions on what’s happening at shelf. Category renewal and shopper prospect teams are taking advantage of this new-found shelf visibility to inform their nodal (store-wise) improvement strategy and activate the right plans for each category.

Comparing to every kind and tiers to the product that is mentioned to be merchandized, the SKUs hold up to the congruent shelves and find its movement, response and stock liking across different interconnected stores to give a perfect shelving algorithm for any of the product that a store has promised to give a warm welcome and a vast shelf time in the market!

To know and learn more of the innovative merchandizing algorithms of Xtract, head over to, or feel fee to follow us on one of our social handles — Instagram, FaceBook, and more.

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“We Xtract the greatness from the goodness!”

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