BUFFALO, N.Y. -- Supermarkets could increase their sales of related items, such as chips and soft drinks, by moving the items closer to each other in their stores, according to recent research by Ram Bezawada, assistant professor of marketing in the School of Management.
“Retailers can benefit substantially by having better placement of items in their aisles,” Bezawada says. In fact, his research determined that aisle placements can have as much an influence on sales across categories as other marketing mix variables like price or how an item is displayed.
The research, published in the Journal of Marketing, attempted to determine the optimal placement of cross-category items to increase sales. The study was coauthored by S. Balachander, associate professor of management at Purdue University, P.K. Kannan, Harvey Sanders Associate Professor of Marketing at the University of Maryland and Venkatesh Shankar, professor of marketing and Coleman Chair in Marketing at Texas A&M University.
Using the cross-category items of chips and soda, the researchers found that stores placing the items facing each other in the same aisle increased weekly sales of those items by more than 9 percent. In contrast, moving the chips and soda one aisle away from each other resulted in a decrease in sales of nearly 1.5 percent.
Both retailers and consumers can benefit from better cross-category placements in stores, according to Bezawada. “The retailers benefit because their overall sales increase, and consumers benefit by having an easier shopping experience,” he says. In addition, manufacturers who market items in multiple categories (such as Pepsi Co., which produces both soft drinks and chips) could also see their sales rise.
The Wall Street Journal has ranked the UB School of Management No. 9 in the nation among schools with strong regional recruiting bases. In addition, BusinessWeek has ranked the school as one of the country’s top 5 business schools for the fastest return on MBA investment, and Forbes has cited it as one of the best business schools in the U.S. for the return on investment it provides MBA graduates. For more information about the UB School of Management, visit mgt.buffalo.edu.
The University at Buffalo is a premier research-intensive public university, a flagship institution in the State University of New York system and its largest and most comprehensive campus. UB’s more than 28,000 students pursue their academic interests through more than 300 undergraduate, graduate and professional degree programs. Founded in 1846, the University at Buffalo is a member of the Association of American Universities.