{"id":1517071,"date":"2023-01-30T09:53:06","date_gmt":"2023-01-30T14:53:06","guid":{"rendered":"https:\/\/www.practicalecommerce.com\/?p=1517071"},"modified":"2023-11-22T10:16:17","modified_gmt":"2023-11-22T15:16:17","slug":"the-5-rs-of-merchandising-for-ecommerce","status":"publish","type":"post","link":"https:\/\/www.practicalecommerce.com\/the-5-rs-of-merchandising-for-ecommerce","title":{"rendered":"The 5 R&#8217;s of Merchandising (for Ecommerce)"},"content":{"rendered":"<p>For nearly 100 years retail merchandisers have used the five R&#8217;s framework or a variation to design, select, and display products. The concept is valid for ecommerce shops today.<\/p>\n<p>&#8220;It is the responsibility of the merchandise division to provide for the consumer merchandise of the right style and quality, in proper quantities, at the right price, and at the right time,&#8221; wrote <a href=\"https:\/\/www.nytimes.com\/1979\/08\/01\/archives\/paul-m-mazur-at-86-lehman-bros-partner-more-than-50-years.html\">Paul M. Mazur<\/a> of Lehman Brothers in his 1927 book, &#8220;The Principals of Organization Applied to Modern Retailing.&#8221;<\/p>\n<div id=\"attachment_1517381\" style=\"width: 580px\" class=\"wp-caption alignnone\"><img loading=\"lazy\" decoding=\"async\" aria-describedby=\"caption-attachment-1517381\" class=\"wp-image-1517381 size-large\" title=\"Photo of a laptop screen with ecommerce related text on it\" src=\"https:\/\/www.practicalecommerce.com\/wp-content\/uploads\/2023\/01\/Ecommerce-retailing-at-work-570x290.jpg\" alt=\"Photo of a laptop screen with ecommerce related text on it\" width=\"570\" height=\"290\" srcset=\"https:\/\/www.practicalecommerce.com\/wp-content\/uploads\/2023\/01\/Ecommerce-retailing-at-work-570x290.jpg 570w, https:\/\/www.practicalecommerce.com\/wp-content\/uploads\/2023\/01\/Ecommerce-retailing-at-work-300x153.jpg 300w, https:\/\/www.practicalecommerce.com\/wp-content\/uploads\/2023\/01\/Ecommerce-retailing-at-work-150x76.jpg 150w, https:\/\/www.practicalecommerce.com\/wp-content\/uploads\/2023\/01\/Ecommerce-retailing-at-work-500x254.jpg 500w, https:\/\/www.practicalecommerce.com\/wp-content\/uploads\/2023\/01\/Ecommerce-retailing-at-work.jpg 668w\" sizes=\"auto, (max-width: 570px) 100vw, 570px\" \/><p id=\"caption-attachment-1517381\" class=\"wp-caption-text\">The five R&#8217;s of retailing \u2014\u00a0a 100-year-old concept \u2014 applies to modern-day online sellers.<\/p><\/div>\n<h3>5 R&#8217;s of Retailing<\/h3>\n<p>Mazur&#8217;s descriptions have evolved into what some call the five R&#8217;s of retailing.<\/p>\n<ul>\n<li>The right people.<\/li>\n<li>The right product.<\/li>\n<li>The right quantity.<\/li>\n<li>The right price.<\/li>\n<li>The right time.<\/li>\n<\/ul>\n<p>The phrase &#8220;provide for the consumer&#8221; became &#8220;the right people.&#8221; &#8220;The right style and quality&#8221; are &#8220;the right product.&#8221; &#8220;Proper quantities&#8221; became &#8220;the right quantity.&#8221; &#8220;The right price&#8221; and &#8220;the right time&#8221; are direct quotes.<\/p>\n<p><strong>Right people. <\/strong>&#8220;The right people&#8221; can mean knowing your customers \u2014 demographics, psychographics, buying habits, politics, and pain points. This understanding allows ecommerce businesses to tailor their product selection, prices, promotions, and overall customer experience.<\/p>\n<p>Here&#8217;s an example. Imagine a business that sells second-hand apparel to vegans. The company&#8217;s niche might be verifying or even certifying that a specific, decades-old garment was manufactured in such a way to appeal to that audience.<\/p>\n<p>That focus would impact the products, description, and promotions.<\/p>\n<p>It reminds me of the book &#8220;<a href=\"https:\/\/www.practicalecommerce.com\/apply-a-blue-ocean-strategy-for-objective-business-decisions\">Blue Ocean Strategy<\/a>,&#8221; wherein authors W. Chan Kim and Ren\u00e9e Mauborgne argue that a business should focus on creating a &#8220;blue ocean&#8221; of untapped market space rather than fighting for a share of a crowded &#8220;red ocean&#8221; market.<\/p>\n<p>How does your ecommerce business ensure it has the proper customers \u2014 the right people?<\/p>\n<p><strong>Right product. <\/strong>&#8220;The right product&#8221; refers to selecting and offering profitable goods the customers will appreciate.<\/p>\n<p>&#8220;The right product&#8221; for retail ecommerce meets margin targets, sells at an acceptable <a href=\"https:\/\/www.practicalecommerce.com\/how-to-calculate-and-interpret-inventory-turnover\">inventory turnover rate<\/a>, fits with the retailer&#8217;s existing products, and comes from a trustworthy and reliable supplier. The whole package makes for a successful product.<\/p>\n<p>For direct-to-consumer brands, &#8220;the right product&#8221; can be more complicated since it will include design, components, and manufacturing.<\/p>\n<p><strong>Right quantity. <\/strong>&#8220;The right quantities&#8221; addresses the proper inventory level at warehouses near likely customers.<\/p>\n<p>This is not guesswork. A well-merchandised ecommerce business will use inventory tracking data, sales info, warehouse cost analysis, and other tools or models to identify how much of a given product to keep on hand at a specific location.<\/p>\n<p>For example, a merchant would presumably not stock dehumidifiers in Arizona, an arid, dry climate.<\/p>\n<p>Finally, having the right quantity of products likely requires flexibility to adapt to changes in demand.<br \/>\n<\/p>\n<p><strong>Right price. <\/strong>A pricing strategy typically varies based on the size of the business. Owners or managers of small companies often set every price manually using a <a href=\"https:\/\/www.practicalecommerce.com\/3-flaws-of-cost-plus-pricing\">basic formula<\/a> or intuition.<\/p>\n<p>But enterprise businesses usually follow a complicated pricing model.<\/p>\n<p>Regardless, the idea is to establish systems for setting regular and discounted prices for products, customer segments, and timeframes.<\/p>\n<p><strong>Right time. <\/strong>Most consumers will pay more for an umbrella when it&#8217;s raining. I once paid $90 for a sweater because I was freezing.<\/p>\n<p>So &#8220;the right time&#8221; for a product can mean when it&#8217;s introduced, put on sale, or even closed out.<\/p>\n<p>Valentine&#8217;s Day items that come out in March are not present at the right time.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>A 100-year-old merchandising concept applies to modern-day ecommerce retailers \u2014 the right people, right product, right quantity, right price, right time.<\/p>\n","protected":false},"author":391,"featured_media":1517380,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":"","_wp_rev_ctl_limit":""},"categories":[58313],"tags":[],"class_list":["post-1517071","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-inventory",""],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v25.2 (Yoast SEO v25.2) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>The 5 R&#039;s of Merchandising (for Ecommerce) - 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