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Shoppers’ Interaction with Visual Merchandising Elements in Organized Grocery Stores

Anushree Agnihotri and Prathap Oburai
KEY WORDS: Retail in India; Organized Grocery Stores; External Visual Merchandising; In -store Visual Merchandising.


The Indian economy seems to be on a growth spin and the country has appeared as the fourth largest economy in the world on a purchasing power parity basis. The Indian business environment quality has also improved to a noticeable extent and this is apparent as India has attained a position of 43rd rank (GCI Rankings, 2006-07) in the World Economic Forum's Global Competitiveness Index. Concurrently, Indian retail industry has been graded among the ten major retail markets in the world economy (FICCI-BISNET, 2008) and ranked at the top in Asian retail markets (A.T. Kearney GRDI, 2005). This shows that competition has gripped all the sectors of business including retail in India. As a result there is an attitudinal shift of the Indian consume r in terms of choice and value for money. Shoppers are becoming more aware and knowledgeable about product display, formats and practices of retailing to uphold a consciousness for lifestyles and shopping standards. In the most recent years, Indian shoppers have undergone a remarkable trans formation in their lifestyles by shifting from conventional shopping notions for foodstuff, groceries and apparel to upgraded standards in categories that deliver enhanced quality and experience (FICCI- BISNET, 2008). Keeping this in view, a store must possess an environment which has an appealing merchandise display that can trigger the shoppers’ buying eagerness and intent, which can alongside help in coping with the changing environment and rising expectations.
Anushree Agnihotri, Wing 14K , Indian Institute of Management, Vastrapur, Ahmedabad 380 015, India • Phone: 079 66324940 • E-mail: Prathap Oburai, Wing 15, Indian Institute of Management, Vastrapur, Ahmedabad 380 015, India • Phone: 079 66324942 • E-mail:

3rd IIMA Conference on Marketing Paradigms for Emerging Economies

There are various aspects in retail which actually contribute to the sales of merchandise but display is a factor which speaks louder than everything else. Eighty per cent of our impressions are shaped by sight that is why one picture is worth a thousand words (Holly et al., 1991). Visual merchandising is not a mere arrangement of products but goes deeper and wider into the essence of physicality of the store (Davies and Ward, 2005). It can be viewed as

all the things the shopper witnesses, both exterior and interior, which shape a constructive impression of the store and result in higher purchase action at the shoppers’ end. More attempts should be made to improve the visual merchandising elements so as to make it easier for the shoppers to locate the stuff they need or wish for. merchandising can be considered to constitute a fat chunk of the overall retail function of the marketing discipline. It is an indispensable, sophisticated and encompassing component (can also be identified as a stratagem) of the retail sector. The Visual Stimulation term figured by Kerfoot et al. (2003) has a significant position in the lives of retailers and academicians (McGoldrick, 2002). This concern in fact, guides towards the formulation of new visual merchandising elements and practices all over the world. But visual merchandising has still been inadequately responded to (LeaGreenwood, 1998). The value magnitude of visual merchandising had been recognized in the world long ago, around the year 1897. In 1897, Lyman Frank Baum realized a need for ‘The Show Window’ magazine regarding window display. Holly, et al. (1991) has also acknowledged that visual merchandising is second only to effective customer relations. Surprisingly, physical visual merchandising is still a neglected customer-facing contact channel in India. It is at its rudimentary stage only, possibly because visual merchandising has its own progression of motion everywhere! Additionally, there has been a notable paucity of research studies in physical visual display of merchandise assortments in India . The paradox stands here that though visual merchandising is a key contributor towards the sales of product assortments, it often goes unnoticed in the Indian retail management scenario. Conversely, the retail literature is slowly but surely flourishing for in-store physicality and display in apparel, accessories and fashion retailing (Thompson and Chen, 1998) almost everywhere in the world leaving the food and grocery
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facade somewhere behind. The attention is largely nonexistent for visual presentations at food and grocery stores. Till now literature was spinning around the macro level aspects of retail (retail formats, organized Indian retail and visual display and store design) which appeared ill-suited for all the product categories to view this customer-facing contact channel (visual merchandising). The findings of the paper by V. Zeithaml (1988), stated that shopper perception keeps on changing with the changing competitive environment, transparency of information leading to added knowledge and growing expectations. Shoppers formulate a positive outlook for anything that reduces their search time, locating and expenses. Improved visual merchandising practices and easy product display can help shoppers save their time and expenses. The present study illustrates an effort towards addressing this insufficiency from the shoppers’ perspective. It explores the food and grocery store visual merchandising of organized retail, which is a less traversed path.


1. To explore how the visual merchandising elements are being used by organized grocery retailers in India. 2. To recognize the relative importance of the visual merchandising elements used in the grocery store by shoppers. 3. To identify which visual merchandising element is most preferred by shoppers in a grocery arrangement. 4. To trace variations in the preference of visual merchandising elements across demographic variables.
The Organized Food and Grocery Sector

In the present scenario, food and grocery is not just related to food items and fresh vegetables but it extends far beyond that. Shoppers now look for convenience, style, display, easy accessibility and a complete shopping experience. Food and Grocery store visual merchandising has been preferred as a suitable research domain because of the entrenched links between growing organized food and grocery retail, lifestyle of shoppers and their shopping notions. • 52 per cent of the growing consumer expenditure is accounted for food and grocery ( -Presentation Harsh-Puri.pdf.aspx).
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Food and grocery is the fastest growing segment . If we see the organized retail industry as a whole, food and grocery is the leading sector with 59.5 per cent share, valued at Rs 792,000 crore , followed by apparel sector at 9.9 per cent share valued at Rs 131,300 crore (Singh, 2008).
• • •

Supermarkets are becoming more prominent and Hypermarkets contributing better choice at lower prices, expected to dominate (ATK Retail Survey, 2005). Early mover advantage is still available in grocery retail (Denstadli et al., 2005).

Visual merchandising in the Indian context has not evolved much on this front. As the study focuses on ‘food and grocery store visual merchandising’, the six organized panIndia grocery retail chains (Spencer’s, More, Food Bazaar, Reliance Fresh, Indiabulls and Star India Bazaar) were assumed to be most ideal for the present exploration.

This study has been split into two research phases.

Phase I

This phase is exploratory and qualitative in nature. An observation research (Instore and exterior) has been carried out in six organized pan-India grocery retail chains (Spencer’s, More, Food Bazaar, Reliance Fresh, Indiabulls and Star India Bazaar) of Ahmedabad city to understand the visual merchandising elements they have adopted. As an outcome, a total of nine elements have been chosen for this study assuming their relevance attached to any Indian organized grocery store. Exterior Visual Merchandising Elements
• • •

Marquees Entryway Store windows

In-store Visual Merchandising Elements • Store layout plan
• • •

Color Lighting In-store signage

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Merchandise sequencing style • Fixtures and Hardware

The above in-store visual merchandising elements were found analogous and consistent with the findings of Kerfoot et al., (2003).
Phase II

In this phase an empirical field research would be conducted to find the significance and value the shopper connects, to each of the nine elements of visual merchandising (recognized in Phase I). To measure shoppers’ overall assessment of these elements, a self-administered structured questionnaire would be constructed and piloted.
SAMPLE DESIGN Population and Sample Size

A sample of shoppers from Ahmedabad a mini metro city of Gujarat would be selected and surveyed. Convenient sample of 150 shoppers would be drawn from randomly selected 6 stores of each of the pan-India grocery retail chain under this study. 25 shoppers × 6 stores = 150 respondents + 6 store managers (N = 156)

Shopper’s Profile

As the buying decision about groceries is generally taken by housewives, the researcher would survey female respondents (not strictly housewives). The age of the subjects will range from 21 to 50 years, across all the socio-economic backgrounds.
Contact Method and Research Instrument 3

‘In-depth Interviews’ would be conducted for 6 grocery store managers and ‘Questionnaire’ would be administered for 150 grocery shoppers. The instrument would be administered methodically to the shoppers outside the store immediately after their experience and interaction with the visual merchandising elements on randomly picked week days. Shoppers would be asked to cooperate by providing complete response to the questions, so that more accurate outcomes can be attained.
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Pilot-testing of the Instrument

The questionnaire would be pilot-tested on 15 female respondents (approximately 10 per cent of the main survey sample size) belonging to different age groups, household income levels and socio-economic backgrounds. Based on their responses, the required modifications would be made in the instrument. The amended questionnaire would be used for the further study.
Data Analysis and Results

Statistical Analysis Software (SAS) would be used to analyze the data collected. Test of mean and regression analysis would be employed as tools. This paper proposes to map the effects of the visual merchandising elements on the overall assessment of store visual merchandising from shoppers’ perspective. This study focuses on the shoppers’ preference amongst the in-store visual merchandising elements and exterior visual merchandising elements. The author proposes to portray the findings in the final paper.

This study is among the first to offer a comprehensive picture of the most neglected face of the modern organized grocery stores in India. It exemplifies an association of the instore and exterior visual merchandising elements with the shoppers’ preferences in an organized grocery setting. This paper proposes to draw the facts, which will help the store managers in recognizing the significance of visual merchandising elements on the overall assessment of store visual merchandising. Implications would be extended in the final paper.

Bastow-Shoop, H.; Dale , Z. and Gregory , P. (1991). Visual Merchandising : A Guide for Small Retailers, Arnes, IA : Iowa State University. , B.J. and Ward , P. (2005) . “Exploring the Connections between Visual Merchandising and Retail Branding,” International Journal of Retail & Distribution Management, 33( 7) , 505-13. Denstadli, J.M .; Lines , R. and Gronhaug, K. (2005). “First Mover Advantages in the Discount Grocery Industry ,” European Journal of Marketing, 39(7 / 8), 872-84. Kerfoot, S.; Davies , (2003). B. and Ward , P . Discernible Retail Brands,” International Journal of Retail and Distribution Management, 31 (3), 1 43-52. Lea-Greenwood, G. (1998). “Visual Merchandising: A Neglected Area in UK Fashion Marketing?” International Journal of Retail and Distribution Management, 26( 8), 324-30. “Visual Merchandising and the Creation of

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Levy, M. and Weitz, B.A. (1998). Retailing Management, Boston: Irwin McGraw-Hill, McGoldrick, P . (2002), Retail Marketing, (2nd edition), London: McGraw-Hill. Sinha, P.K. and Banerjee, A . (2004). “Store Choice Behaviour in an Evolving Market,” International Journal of Retail and Distribution Management, 32( 10) , 482-94. Sinha, P.K. and Uniyal, D. (2004). “Using Observational Research for Behavioural Segmentation of Shoppers ,” Journal of Retailing and Consumer Research, 12( 1) , 35- 48. Thompson, K.E. and Chen, Y.L. (1998). “Retail Store Image: A Means-End Approach,” Journal of Marketing Practice: Applied Marketing Science, 4(6), 161-73. Underhill, P . (1999) . Why We Buy: The Science of Shopping, New York, NY: Simon and Schuster. Zeithaml, V.A. (1988). “Consumer Perception on Price Quality and Value: A Means-End Model and Synthesis of Evidence,” Journal of Marketing, 52( 3) , 2-22.

Web References
A.T. Kearney Global Retail Development Index, ( 2005). p=5,3,1,110 . ATK Retail Survey, (2005). 20India%20 -Unlimited%20Opportunities.pdf. FICCI- BISNET , ( 2008). GCI Rankings, (2006-07). Singh, ( 2008). http:/

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