More Omnichannel, Merchandising, and Jellybeans at NRF

By Sarah Etter

January 16, 2013

Yesterday, the National Retail Federation’s Big Show kicked off with a keynote session called “The Great Convergence,” which focused on the ways advances in technology have changed consumer behavior.

Sound familiar? (See Monday’s Omnichannel All the Buzz at NRF’s Big Show.)

NRF Big Show 2013Alison Paul, Vice Chairman at Deloitte, discussed the retail revolution that is facing industry leaders. She pointed to the physical and virtual worlds “inextricably melting,” thanks to the always-connected consumer.

“It’s no longer about one channel,” Paul said. “It’s about all channels, all the time. Leaders must embrace change and tear down silos.” She added, “Legacy channels are artifacts now.”

Next up, Susan Jurevics, SVP at Sony Corporation, discussed how the electronics retailer responds to new customer demands and behaviors. “Consumers are no longer a captive audience,” Jurevics said. “We must work harder to get and keep their attention.”

Jurevics added that Sony’s priority is to be “consumer-insight driven,” echoing a sentiment that could have been the mantra of the entire conference.

Then, Thomas Belk, Jr., Chairman and CEO of Belk, Inc., took his place on the huge stage, as lights and video screens flashed and thousands of attendees looked on. Belk focused on his company’s omnichannel journey, which started with one objective: Data.

“We found that our omnichannel, or multichannel, shopper spends three times more than our in-store shopper,” Belk explained. “That got our attention.”

With that information in hand, Belk began an initiative that included revamping stores as well as focusing on a new technology platform, replacing legacy systems, partnering with Deloitte, and integrating data to create a “single truth” about Belk’s customers.

“Customer data is the heartbeat of omnichannel,” Belk said. “Now, in an omnichannel world, customers come to our brand because we are deeply relevant to them, not because we are a nearby store.”

An Academic Look at Merchandising... and Jellybeans?

One of the other standout panels, “Assortment Variety: Is It Too Much of a Good Thing?,” featured Barbara Kahn, Jay H. Baker Professor of Marketing at the Wharton School.

It was a fascinating examination of how customers look at assortment, based on academic research. “How much variety does a customer want to see?” Kahn asked the crowd. And she was met with silence. The problem: While online visitors might like to have a large variety of product options, there’s actually a negative consequence if they have too much to choose from without any way to navigate the offering.

Kahn pointed to a number of studies, including her own, which involved offering people six different types of jelly beans sorted by color, and then offering people 24 different types of jelly beans also sorted by color.

Sound silly? Wait for it.

Kahn found that when people were offered six different types of jelly beans, they chose fewer jelly beans. Meanwhile, people who were offered 24 different types of jelly beans chose more. “More variety increases consumption,” Kahn explained. “But the variety must be attractive, not complex.”

Case in point: Kahn tried the same study, with six and 24 varieties of jellybeans. This time, however, she scrambled the jelly beans up instead of sorting them by color. This time, people chose less overall.

Carried over to ecommerce, think about it like this: You might offer visitors 1,000 shirts. And visitors might like that you have such a wide variety. But a number of factors can lessen the value of that variety: How are the shirts displayed? How hard it is to scroll through them? How are they organized and searchable on the website?

Kahn notes that displaying products visually, whether you have a large or small assortment, seems to resonate with visitors.

However, she pointed out that there’s one step websites should take to help customers: For large assortments of products, add some descriptive text to slow the website visitor’s eye down and make sure they don’t get overwhelmed by all the choices.

Kahn’s session was an interesting, academic look at the ways ecommerce companies can lessen the complexities of their assortments in order to ensure visitors don’t become overwhelmed, and leave without purchasing anything.

Jelly Beans image courtesy of Shutterstock.

Sarah Etter is the former the senior editor at Monetate. Before joining Monetate, she was a writer for various online and print publications, and served as the associate editor of The Internet & Marketing Report newsletter. Sarah also loves fiction writing and ice hockey... yes, ice hockey.

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