Merchandising products to increase customer engagement

Deciding on which products to merchandise will depend on the category or classification displayed in-store. Here we explore some merchandising standards and principles used by many retail organisations.

Display your products in the way in which customers shop

This means that the store and its departments are arranged in logical groupings so that customers can find like products together – we call this the principle of ‘product adjacency’ for example suit jackets would be merchandised in the formal section of the store above suit pants with ties and belts as the adjacent product

Like Goes With Like

When displaying products within departments and categories show like products together – this way they make a stronger visual impact and make it easier for customers to find. In a hardware store you would expect to find all paintbrushes together, merchandised by brand, size or price point. 

Watch the flow!

Every department should be laid out according to the product flow that suits the customer best and will make the highest return for your store. This means that as customers move off main aisles to walk around departments the order in which products are displayed make them easy to find. For example in a computer department the customer should find the laptop next to the printer next to the ink cartridges next to the lap top -creating the product ‘flow’ that customers will understand.

Good, Better, Best

Customers like to see products arranged in logical price order, from low to high price. Retailers all over the world have used this principle to show customers a wide range of price options, and to encourage them to increase their average purchase value by being tempted by a better model alongside a less expensive one.

Focus on accessories to maximise profit

Most departments have some form of accessories. Accessories can increase sales and profit in most transactions and because they are generally smaller items on higher margins, they produce an unbeatable return per square metre. It is very important to remember our adjacency principle of ‘display how customers shop’ when displaying accessories.

Let the customer interact

This principle is there to ensure that for every product there is a display model or product for customers to touch and feel, plus enough reserve stock for the customer to easily self-select and purchase.

Hero products Each product category should have a “hero item” prominently merchandised on a special display, sometimes a gondola end or bulk stack (more on these later), or often a mannequin dressed in the latest look. The hero item is often your best seller

Customer expectations, of how retail businesses should present themselves is very high. Competition is a daily challenge, how your customer experiences your store can be a major factor in maintaining a repeat customer.


To learn how to steer your success as a team leader, the ARA Retail Institute runs multiple workshops on leadership and team culture. Join the ARA Retail Institute in their latest workshop which looks into how a team’s attitude and behaviours influence the outcome of challenging customer moments.


About ARA Retail Institute

ARA Retail Institute is Australia’s leading retail training provider for both accredited and non-accredited learning programs. For more information, please visit:



Retail Voice CEO Message: 10 July 2024

Earlier today, the ARA voiced its disappointment on the decision of the NSW Government to ban trading for larger retailers on ANZAC Day – noting that the current approach strikes

Retail Voice CEO Message: 3 July 2024

Creating a more inclusive retail sector is a vital focus for the ARA and last week we were proud to co-host our third annual Diversity, Equity and Inclusion (DE&I) Symposium,