231-2nd icber 2011 pg 1130-1154 visual merchandising techniques
TRANSCRIPT
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THE IMPACT OF SELECTED VISUAL MERCHANDISING TECHNIQUESON PATRONAGE INTENTIONS IN SUPERMARKETS
(STUDY BASED ON COLOMBO DISTRICT)
Authors
Ridmi GajanayakeUniversity of Kelaniya
Sri Lanka
Mobile: +940716822845
Email : [email protected]
Sashini Gajanayake
Staffordshire University
Sri Lanka
Mobile: +940774191509
Email : [email protected]
H.A.K.N.S. Surangi
University of KelaniyaSri LankaMobile: +940722488850
Email : [email protected]
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Abstract
Supermarket industry is one of the fast growing industries in Sri Lanka. At present there are over
300 supermarkets are in the industry owned by various companies. According to the prevailing
literature many researchers are agreed that visual merchandising plays a vital role in retailing. It
has become an essentially important element in the retailing industry, in apparel store,
supermarkets etc. Therefore, every marketer pays attention to this aspect in order to attract the
customers and to survive in the industry.
The main objective of this study is to identify the influence of visual merchandising on patronage
intentions. It will also aim at identifying the current strategies used by supermarkets to enhance
their visual merchandising and to suggest further improvements.
This study was based on secondary and primary data. Primary data was collected through the
survey and semi-structured questionnaire was used to collect the data. The study will considered
a sample of 307 supermarket shoppers from five different supermarkets located within Colombo
City limits, i.e. from Colombo 1 to Colombo 15. Hypotheses were tested by the regression and
ANOVA analysis employing SPSS software. Out of all six hypotheses five were accepted and
only one hypothesis was rejected.
Key words: Visual merchandising, Patronage intentions, Supermarket, retailing, customers
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1. Introduction
Supermarket industry is one of the fastest growing industries in the Sri Lankan economy. It is a
concept that was brought into Sri Lanka during the 1980s. Gradually they captured a large
number of customers all over the country and now have established themselves as a very
dynamic and lucrative industry in the country. There are over 300 supermarket outlets owned by
various companies and some of the leading companies are Cargills, John Keells Holdings, and
Richard Pieris etc. other than those there are many small supermarket chains running under the
names of Magna, Laughs Sun Up, Crystal etc.
Visual merchandising plays a major role in retailing. It is that which enhances products,
supports brands, increases traffic and sales, adds visual excitement by way of strategically
located and illuminated focal destinations in an environment, typically businesses and stores,
defines and advertises overall personality and image. (Gorman,nd.) It is everything the
customers see and feel within a store that arouses their interest and desire. In other words it is an
important element for a supermarket to attract and capture the customers attention towards the
products and induce them to purchase them. An effective visual merchandising strategy will help
the supermarkets to be ahead of the competitors within the industry and have a competitive edge.
1.2 Problem Statement
Supermarket industry is a very volatile one. In Sri Lanka it is at the growth stage, where new
outlets emerge very often. There is a high degree of competition among the companies within the
industry to stand out from the rest and to be the best supermarket chain of the country.
Colombo is the highly industrialized and dynamic city in Sri Lanka. People within that city limits
lead busy lifestyles and often seek for convenience. Therefore, the frequency of visiting
supermarkets would be high.
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Visual merchandising is one of the major tactics used by retailers to attract customers to the
stores. It will stimulate them to choose the most liked store, spend more time in it, and examine
the products and eventually resulting in a purchase.
This study focused on identifying the impact of visual merchandising on patronage intentions
would therefore be carried out with the research problems of
Does visual merchandising have an impact on Patronage Intentions in Supermarkets
within the Colombo City Limits?
1.3 Objectives of the Study
The key objective of this research is;
To identify the impact of visual merchandising on patronage intentions in supermarkets
located within the Colombo City limits.
Specific objectives are;
To identify the most important visual merchandising techniques that would influencepatronage intentions in supermarkets within the Colombo city limits.
To identify the widely used visual merchandizing techniques by different supermarketchains in operating in the Colombo city limits.
2. Literature Review
Visual merchandising is a major factor often overlooked in the success or failure of a retail
store. It is second only to effective customer relations. Visual merchandising can be defined as
everything the customer sees, both exterior and interior, that creates a positive image of a
business and results in attention, interest, desire and action on the part of the customer.
(Bastow-Shoop et al., 1991)
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Another definition for visual merchandising was put forward by Walters and Waters (1987) as
. activity which coordinates effective merchandise selection with effective merchandise
display. (Cited in Kerfoot et al., 2003) Kerfoot et al, (2003) stated that visual merchandising is
therefore concerned with both how the product and/ or brand is visually communicated to the
customer and also whether this message is decoded appropriately in this context affecting a
positive psychological or behavioral outcome, ultimately leading to purchase.
Schimp (1990) has defined the role of visual merchandising as to;
- create awareness among customers about a product and provide relevant informationabout it;
-
remind customers about the benefits of a product and of its availability;- encourage customers to buy a particular product or brand;- maximize the utilization of space, while at the same time making the buying experience
as easy as possible for customers;
- reinforce the retailers communications campaign;- assist the customers in locating, evaluating and selecting a product.
(Fernie and Moore, p.312)
As per the above definitions visual merchandising is an essential element which plays a vital role
in a supermarket setting. It enables the store to attract more customers, help them in selecting the
products they look for, retain them for a longer time and encourage them to purchase items with
or without a prior plan.
2.1.1.1 Store layout
Borges (2003) in his study mentioned that the store layout is a huge task for retail managers. The
complexity of this task lies in the relationship between categories on sale as well as on the
impact that it produces on the consumer spatial behaviour and in-store traffic.
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According to FMI (2000) 94% of American grocery shoppers seem to consider that a store
layout that makes shopping easier as important when choosing their supermarket. Time
conscious and empowered consumers will be more attracted by supermarket chains who adopt
one stop shopping store layouts. (Cited in: Borges, 2003)
Farley and Ring (1966) suggested that shoppers might be influenced to buy by the layout itself
and that a good store layout forces each customer to travel past as many displays as possible.
The results of a survey conducted by Wilson (2007) proved that layout bas a big influence on
customers and that the customers want stores to spend whatever it takes to create a layout that
minimizes wasted steps and motion in the shopping process. In addition it was stated that the
shoppers attach more influence to the floor of a store than to its ceiling.
2.1.1.2 Colour
Many researches have been carried out throughout the years in relation to physiological and
psychological effects of colour. Gerard (1957) states that generally, warm colors (red and
yellow) have produced opposite physiological and psychological effects than cool colors (blue
and green), which are opposite on the color spectrum. For example, red or warm colors have
been found to be associated with increased blood pressure, respiratory rate, eye blink frequency.
(Cited in: Bellizzi and Hite. 1992)
Bellizzi et al. (1983) investigated the effects of color in retail store design. The results indicated
that despite color preferences, subjects were physically drawn to warm color (yellow and red)
environments, but they paradoxically found red retail environments to be generally unpleasant,
negative, tense, and less attractive than cool color retail (green and blue) environments. He
speculated that a red environment may over stimulate buyers both physiologically and
psychologically and thereby may impair purchasing deliberations and buying decisions. (Cited
in: Bellizzi and Hite. 1992)
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2.1.1.3 Product display
In a study carried out by Abratt and Goodey (1990) product display has been identified as an in
store stimuli, which is a promotional technique used to encourage impulse buying. There it is
stated that displays can increase the rate of unplanned purchase in retail stores on grounds that
the consumers naturally tend to focus and perceive at eye level. It was also found out in their
study that displays are one of the most influential factors on unplanned purchases. Gutierrez
(2004) has found in his research regarding impulse purchases that the presence of
environmental stimulation variables such as . or attractive store displays may moderate the
choice of search strategies and making impulse purchases.
Simonson and Winer (1992) found that purchase behaviour can be modified by the way in which
inventory is arranged. Kumar and Leone (1988) maintain that point of purchase displays can be
very useful in stimulating sales.
Davies and Tilley (2004) explained that product shelving has an important influence on
consumer behaviour. Both the height at which the products are displayed and the number of rows
in the store can influence the sales of products. In a moderate sized general supermarket, the
average shopper will select only thirty five of the likely several thousand different items on
display. Moreover, most frequently purchased products should never be located in adjacent
spaces but should be spread throughout the store thus increasing the probability of impulse
purchasing of the intervening products. Careful placing of high demand lines can help to attract
customers to parts of the shop: while impulse purchase lines with high profit margins should be
placed alongside the everyday goods. It was also mentioned that more than 50 percent of
purchases by supermarket shoppers are pre planned and the remainder are largely stimulated by
the display in the store. Products should be accessible to the customers.
2.1.1.4 Music
Bruner (1990) suggests that the genre of the background music is likely to produce stronger
effects on perceptions and preferences. Further, according to Cupchik et al. (1982) since
preferences for musical genres are strongly influenced by individual differences varying the
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genre of a store's background music is more likely to produce differential effects across customer
groups. (Cited in: Areni and Kim, 1993)
A study by Milliman (1982) suggests that slow tempo of instrumental background music can
significantly slow the pace of in-store traffic flow of supermarket customers, as opposed to fast
tempo. In a follow-up study once again by Milliman (1986) came out with a result that diners
stayed longer and consumed more alcoholic beverages when slow tempo instrumental
background music was playing than when fast tempo instrumental music was used An early
study by Smith and Curnow (1966) found that significantly less time was spent in the stores
when the music was loud compared to when it was soft. Kellaris and Rice (1993) used a decibel
meter in comparing the impact of soft (average sound level of 60 dB) and loud music (average
sound level of 90 dB). They reported that the impact of loudness on musical preference differed
by gender, with females reacting more adversely than males to louder music. (Cited in: Oakes,
2000)
2.1.1.5 Lighting
Mehrabian (1976) believed that lighting was a chief factor in the environments impact on
individuals because brightly lit rooms are more arousing than dimly lit ones. (Cited in:Summers and Herbert, 1999) Areni and Kim (1994) found that consumers examined and
handled significantly more items under bright lighting conditions than under soft lighting
conditions.
With reference to the Illuminating Engineering Society of North America (IES) Handbook states
that the primary goals common in the lighting of merchandise are to attract the consumer, to
initiate purchases, and to facilitate the completion of the sale (Rea, 1993). The IES
recommends that when illuminating merchandising spaces, lighting designers should create a
pleasant and secure environment to do business (Rea, 1993, p. 591).
According to Summers and Herbert (1999) a more appealing store with better-illuminated
merchandise may entice shoppers to visit the store, linger, and hopefully make a purchase. Their
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findings suggest that a retailers manipulation of the in-store supplemental display lighting may
achieve a significant increase in general consumer involvement with in-store display
merchandise.
Shoppers are highly sensitive to the way a store is lit. They attach more influence to lighting than
they do fixtures and signage.
2.1.1.6 Cleanliness
A study by Carpenter and Moore (2006) indicated that both frequent and occasional shoppers
across all retail formats indicated cleanliness as the single most important store attribute.
Yun and Good (2007) declared that shopping in an immaculately clean store might generate
image perceptions of cleanliness, contentment, or luxury. Thus, store image (e.g. a store is clean,
secure, friendly, etc.) can be described as the overall look of a store and the series of mental
pictures and feelings it evokes within the consumer.
2.2 Dependent Variable
2.2.1 Patronage intentions
Consumer patronage intention is driven by a combination of attitude toward the purchase
behaviour and a set of normative beliefs and motivations toward the behaviour (Burnkrant and
Page Jr. 1982; Fishbein and Ajzen 1975). In retail, intentions are usually determined by a
willingness to stay in the store, willingness to repurchase, willingness to purchase more in the
future, and willingness to recommend the store to others (Baker et al. 2002; Hightower, Brady
and Baker 2002; Macintosh and Lockshin 1997).
Retailers are interested in understanding patronage intentions because of the need to forecast
customers buying behaviour of products and/or services, their willingness to return to the store,
and to deliver good word-of-mouth to fellow customers (Donovan and Rossiter 1982).
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According to Grewal et al. (2003) retailers have a certain amount of control over factors that
influence consumers patronage decisions. Having a desirable product assortment where and
when the customer wants it and priced at the level they are expecting to pay is fundamental to
any retail strategy. Yet other, less obvious factors can influence customers purchase intentions.
Atmospherics can make customers less aware of their wait because they are either distracted
and/or entertained.
Stores can creatively use a stores layout or method of displaying merchandise to alter
customers perceptions of the atmosphere. Alternatively, they can enhance the stores
atmospherics through visual communications (signs and graphics), lighting, colors, and even
scents.
3. Conceptual Framework and Hypotheses
Figure 1: Conceptual framework
3.2. Hypotheses
H1: There is a relationship between store layout and patronage intentions in supermarkets.
H2: There is a relationship between colour and patronage intentions in supermarkets.
H3: There is a relationship between product display and patronage intentions in supermarkets.
H4: There is a relationship between music and patronage intentions in supermarkets.
H5: There is a relationship between lighting and patronage intentions in supermarkets.
Visual merchandising
Store layout Colour Product display Music Lighting Cleanliness
Patronage intentions
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H6: There is a relationship between cleanliness and patronage intentions in supermarkets.
4. Research Methodology
The research is based on deductive approach where the existing theories and concepts will be
used in order to develop hypotheses and test them through a systematic methodology. Survey
method was identified as the most appropriate strategy to perform the research activities. The
survey will be conducted on supermarket shoppers.
.
Since it is impossible and impractical to use the entire population to obtain information for this
research a section of the entire population would be selected to perform the research more
effectively. For this study the sample was selected within the Colombo city limits.
Sampling can be done either as probability or non probability design. A simple random
sampling method will be used here where each respondent gets an opportunity to participate in
survey.
The population within Colombo 1 to Colombo 15 is 695,885 as per the 2006 estimates. Since this
figure is above 1,000,000 as per the Andersons method a sample of 384 was considered.
(Saunders et al. 2007) This sample of 384 was randomly selected from 15 supermarkets within
the Colombo city limits. These supermarkets were selected on the basis of monthly customer
count, those of which have a monthly customer count above 12,000.
Secondary data will be gathered from previously done research articles, books and the Internet.
Primary data were collected through the means of questionnaires and interviews.
4.1 Data collection instruments
Questionnaires: A questionnaire was developed to distribute among the supermarketshoppers. It included only close ended questions as the respondents might hesitate to
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spend time on filling it. The questionnaire was developed by the researchers and was
tested the validity by conducting a pilot survey.
Interviews: interviews were conducted with the supermarket managers in order to obtaininformation and their opinions on visual merchandising.
4.2 Data Analysis Techniques
An ANOVA test was used to analyze data and to test the hypotheses. Descriptive tools such as
mean scores, percentages and standard deviation was also used.
5. Data Analysis and Presentation
5.1 Descriptive Statistics
5.1.1 Level of monthly income
Table 1: Income level of the respondent
A majority of 70 respondents receive a monthly income between LKR 30,001 40,000, which is
22.8%. The second highest number of respondents (65) LKR 50,001 60,000 category with
21.2% while 64 out of 307 respondents receive an income of more than LKR 60,001.
5.1.2 Frequency of visiting a supermarket
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Table 2: Frequency of visiting supermarkets
38.8% of 307 respondents visit a supermarket once a week. 36.2% (111) visit a supermarket once
every two weeks. 58 respondents visit once a month. 3.3% visit once every three months while
only 9 respondents visit less often, that is more than three months.
5.1.3 Identification of the most important visual merchandising techniques that would
influence patronage intentions in supermarkets within the Colombo city limits
Table 3: Most important visual merchandising techniques
Store
layout
Colour Product
display
Music Lighting Cleanliness
Averages of
visual
merchandising
3.629 3.714 4.168 3.289 3.571 3.770
Importance 4 3 1 6 5 2
According to the above table it is evident that product display is the most important visual
merchandising technique when prioritized according to the mean values of the averages of every
independent variable. Cleanliness was ranked as the second most important technique with an
average mean value of 3.770. The next significant technique is the colour scheme. From the six
techniques identified music is the least important technique that can be adopted to influence
patronage intentions.
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5.2 Hypothesis Testing
5.2.1 ANOVA (Analysis of Variance) Test
H1: There is a relationship between store layout and patronage intentions in supermarkets.
Table 4: ANOVA Hypothesis 1
The above ANOVA table tests whether the difference between the deviations in the variable
store layout is explained by differences in the variable patronage intentions. The output of the
test, which is p = 0.147 illustrates that there is no relationship between patronage intentions and
store layout. Therefore the hypothesis one is not supported by the results of the test and it is
rejected because p>0.05.
H2: There is a relationship between colour and patronage intentions in supermarkets.
Table 5: ANOVA Hypothesis 2
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The above ANOVA table tests whether the difference between the deviations in the variable
colour is explained by differences in the variable patronage intentions. The output of the test,
which is p = 0.009 illustrates that there is a relationship between patronage intentions and colour.
The hypothesis two is supported by the test results and it is accepted because p
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The above ANOVA table tests whether the difference between the deviations in the variable
music is explained by differences in the variable patronage intentions. The output of the test,
which is p = 0.002 illustrates that there is a relationship between patronage intentions and music.
The hypothesis four is supported by the test results and it is accepted because p
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The above ANOVA table tests whether the difference between the deviations in the variable
cleanliness is explained by differences in the variable patronage intentions. The output of the
test, which is p = 0.002 illustrates that there is a relationship between patronage intentions andcleanliness. The hypothesis six is supported by the test results and it is accepted because p
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The results of the study demonstrate that there is no significant relationship between the store
layout of a supermarket and the patronage intentions. The p-values obtained from ANOVA test
was 0.147 and it is greater than 0.05. Hence the hypothesis one was not accepted.
It is interesting to note that this research depicts a contradictory relationship between store layout
and patronage intentions compared to the previous researches carried out. McElroy et al. (1990)
explained that store design or the design of the place in which a service encounter takes place
affects consumer perceptions and attitudes.
The contrasting result may be due to the fact that it in the Sri Lankan context most supermarkets
are not spacious enough and located within minimum square feet. Therefore, relative to the
international researches carried out the local context could be different.
6.1.2 Patronage intentions have a relationship with the colour of supermarkets within the
Colombo city limits.
This study produced the result of a significant positive relationship between colour and product
display. According to the ANOVA test p-value is 0.009. Hence it is less than 0.05, the
hypothesis two is accepted.
A study Bellizzi et al. (1983) proved that the color of a store can physically attract consumers
towards merchandise displays (p = 0.043) and affect their evaluation of the store and
merchandise image.
6.1.3 Patronage intentions have a relationship with the product display of supermarkets within
the Colombo city limits.
It was found in this study that there is a relationship between product display and patronage
intentions is significant at a p-value of 0.018. The finding is as similar as one of the findings of
Abratt and Goodey (1990) which explained there is a relationship between product display and
shoppers willingness to buy.
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6.1.4 Patronage intentions have a relationship with music in supermarkets within the Colombo
city limits.
The independent (music) and the dependent (patronage intentions) variables have a significant
relationship becausep = 0.002. The ANOVA test illustrated that p
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The mean values of the averages of every independent variable were prioritized in the
descending order to find out the most significant visual merchandising techniques that would
influence patronage intentions in supermarkets. From the six techniques considered under this
study product display was the most important visual merchandising technique with the highest
average mean value of 4.168. Cleanliness was ranked as the second most important technique
with an average mean value of 3.770. The next significant technique is the colour scheme. From
the selected techniques music is the least important technique that would influence patronage
intentions in the supermarkets.
As per the third objective, which is to identify the widely used visual merchandizing techniques
by different supermarket chains in Sri Lanka the following results were drawn.
This study considered five major supermarket chains in Sri Lanka, specifically within the
Colombo city limits. They are Cargills Food City, Keells Super, Arpico Superstore, Laughs
Sunup and Magna. Interviews were conducted with a manager from each supermarket chain to
identify the visual merchandising techniques that are being widely used in the respective chain.
Observations were also useful in fulfilling the particular objective.
Cargills Food City, considered as the dominant supermarket chain in the industry gives priority
to cleanliness. It is believed that cleanliness should be maintained inside and outside the
supermarket in order to retain the existing customers and to attract potential customers.
(Muthukumara, D. 2008. pers.comm. 30th
July) Another vital technique is lighting. The interview
as well as the observations proved that all Cargills supermarkets are well illuminated. The
manager was in the opinion that it is essential to ensure necessary lighting is provided that the
customer can examine the products well. Product display is also considered as another widely
used technique depending on the size of the store. The supermarkets attempt to make sure that
the products are spaciously arranged in an attractive manner to stimulate purchases.
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The major visual merchandising technique broadly used at Keells Super is a convenient store
layout. It makes sure that the customers can freely navigate within the store without any barriers.
Also they use product display as another technique to stimulate purchases.
Arpico superstore is an exemption from the usual supermarkets in Sri Lanka. The store offers
variety of products apart from the food items and the typical products that are available in other
supermarkets. They give priority to both store layout and product display to allow greater
browsing to the customers as there is a range of products. The store also uses music at times to
entertain customers and make them stay longer. Through observations it was evident that the
store lacks lighting and cleanliness to some extent.
Laughs Sunup and Magna widely use the techniques of colour and lighting. The supermarkets
have used attractive colour schemes and there are sufficient lighting. Laughs is in the process of
ensuring an attractive product display and cleanliness throughout the entire supermarket chain.
(Sooriarachchi, P. 2008, pers.comm.5th August) It was observed Magna does not have a
convenient store layout because those stores are located in congested areas where the sizes of the
stores are relatively small.
7. Recommendations
7.1 Short Term Recommendations
It is important that supermarket retailers ensure a clean atmosphere to their customers. The store
floor should always be clean. It is important to remove discoloured and damaged items from
shelves. Greater concern should be given to packaged products especially perishable food
products. The entire supermarket should be clean and hygienic in order to enable the customers
to easily access the products without any complaint. Cleanliness will create a positive impression
among customers and encourage them to stay longer and to visit the store again.
Sri Lankan supermarkets lack the relaxing environment while shopping. Therefore, they can play
background music in order to make shopping an entertaining as well as a soothing exercise to the
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shoppers. The soft and classic music are highly recommended than other genres of music.
According to the age statistics most respondents were within the age category of 41 50 years
and most respondents were employed. Hence, they would seek for soft music to make their
minds relaxed and restful.
Sufficient lighting should be available in the supermarket in order to help the shoppers to select
the rights products, reduce the time wasted and feel relaxation during the shopping tours. If the
store is well lit customers will tend to examine new products and spend more time in the store. It
is more pleasing and enjoyable to spend time in a well lit place rather than a dimly lit area.
It is essential that there is a tagged name and price attached on shelves for each and every
product to make it convenient for the customers to select products that they are willing to buy.
The products should be arranged it an attractive manner with the use of different colours. The
retailers should also look into the space given for each product where customers can easily
identify and get it without a problem.
7.2 Long Term Recommendations
The original colour combination that matches with the company logo should be prominent ineach supermarket to identify the store at a glance. The outer appearance helps to recognize the
place even a customer is out of town and revisit as daily customers.
The height and the size of the shelves and racks should be taken into consideration when
designing the product display. Those should not be too high because the shoppers would hesitate
to check products which above the level of reach. Therefore racks should be designed with a
height of an average person in order to make it convenient for the shoppers to get all the products
they desire. The retailers must also make sure that the shelves are spacious enough to display the
products properly.
The supermarkets can take these visual merchandising techniques into consideration when
opening up new branches. As the customer perception towards store layout, colour, product
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display, music, colour and cleanliness were evaluated the managers can take those into account
to match the customer attitudes and the store design.
According to the demographic statistics most respondents were females. Hence the supermarket
retailers can make one step ahead by providing other services such laundering, beauty parlour
etc. to them while shopping.
8. Conclusion
The key objective of conducting this research was to identify the impact of the selected visual
merchandising techniques on patronage intention in supermarkets. It was focused on thesupermarkets located within Colombo city limits. More specifically the study examined the
relationship of the independent variables of store layout, colour, product display, music, lighting
and cleanliness with the dependent variable being patronage intentions.
Relationships were tested with the use of ANOVA and relationships were identified between
patronage intentions and colour, product display, music, lighting and cleanliness.
Recommendations were provided to improve the patronage in local supermarkets in relation to
the findings of the study. The research is a success achieving all intended objectives and it can be
concluded that the players within the supermarket industry can have a competitive edge by
developing an appropriate visual merchandising strategy.
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