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Merchandising is any practice which contributes to the sale of products to a retail consumer. At a retail in-store level, merchandising refers to displaying products that are for sale in a creative way that entices customers to purchase more items or products. In retail commerce, visual display merchandising means merchandise sales using
product design Product design as a verb is to create a new product to be sold by a business to its customers. A very broad coefficient and effective generation and development of ideas through a process that leads to new products. Thus, it is a major aspect of n ...
, selection,
packaging Packaging is the science, art and technology of enclosing or protecting products for distribution, storage, sale, and use. Packaging also refers to the process of designing, evaluating, and producing packages. Packaging can be described as a co ...
,
pricing Pricing is the process whereby a business sets the price at which it will sell its products and services, and may be part of the business's marketing plan. In setting prices, the business will take into account the price at which it could acqui ...
, and display that stimulates consumers to spend more. This includes disciplines and discounting, physical presentation of products and displays, and the decisions about which products should be presented to which customers at what time. Often in a retail setting, creatively tying in related products or accessories is a great way to entice consumers to purchase more. Merchandising helps to understand the ordinary dating notation for the terms of payment of an invoice. Codified discounting solves pricing problems including markups and markdowns. It helps to find the net price of an item after single or multiple trade discounts and can calculate a single discount rate that is equivalent to a series of multiple discounts. Further, it helps to calculate the amount of cash discount for which a payment qualifies.


Promotional merchandising

The annual cycle of merchandising differs between countries and even within them, particularly relating to cultural customs like holidays, and seasonal issues like climate and local sporting and recreation. Events such as
Chinese festival The traditional Chinese holidays are an essential part of harvests or prayer offerings. The most important Chinese holiday is the Chinese New Year (Spring Festival), which is also celebrated in overseas ethnic Chinese communities (for example in ...
s and Japanese festivals are incorporated in an annual cycle of shop decorations and merchandise promotion. In the United States, the basic retail cycle begins in early January with merchandise for Valentine's Day, which is not until mid-February. Presidents' Day sales are held shortly thereafter. Following this, Easter is the major holiday, while springtime clothing and garden-related merchandise is already arriving at stores, often as early as mid-winter (toward the beginning of this section,
St. Patrick's Day Saint Patrick's Day, or the Feast of Saint Patrick ( ga, Lá Fhéile Pádraig, lit=the Day of the Festival of Patrick), is a cultural and religious celebration held on 17 March, the traditional death date of Saint Patrick (), the foremost patr ...
merchandise, including green items and products pertaining to Irish culture, is also promoted). Mother's Day and Father's Day are next, with
graduation Graduation is the awarding of a diploma to a student by an educational institution. It may also refer to the ceremony that is associated with it. The date of the graduation ceremony is often called graduation day. The graduation ceremony is a ...
gifts (typically small consumer electronics like digital cameras) often being marketed as "dads and grads" in June (though most college semesters end in May; the grads portion usually refers to high school graduation, which ends one to two weeks after Father's Day in many U.S. states). Summer merchandise is next, including patriotic-themed products with the American flag, out by Memorial Day in preparation for
Independence Day An independence day is an annual event commemorating the anniversary of a nation's independence or statehood, usually after ceasing to be a group or part of another nation or state, or more rarely after the end of a military occupation. Man ...
(with Flag Day in between). By July, back-to-school is on the shelves and autumn merchandise is already arriving, and at some
arts and crafts A handicraft, sometimes more precisely expressed as artisanal handicraft or handmade, is any of a wide variety of types of work where useful and decorative objects are made completely by one’s hand or by using only simple, non-automated re ...
stores, Christmas decorations. (Often, a Christmas in July celebration is held around this time.) The back-to-school market is promoted heavily in August, when there are no holidays to promote. By September, particularly after
Labor Day Labor Day is a federal holiday in the United States celebrated on the first Monday in September to honor and recognize the American labor movement and the works and contributions of laborers to the development and achievements of the United St ...
, summer merchandise is on final closeout and overstock of school supplies is marked-down some as well, and
Halloween Halloween or Hallowe'en (less commonly known as Allhalloween, All Hallows' Eve, or All Saints' Eve) is a celebration observed in many countries on 31 October, the eve of the Western Christian feast of All Saints' Day. It begins the observanc ...
(and often even more of the Christmas) merchandise is appearing. As the Halloween decorations and costumes dwindle in October, Christmas is already being pushed on consumers, and by the day after Halloween retailers are going full-force with advertising, even though the "official" season doesn't start until the day after Thanksgiving. Christmas clearance sales begin even before Christmas at many retailers, though others begin on the day after Christmas and continue on at least until
New Year's Day New Year's Day is a festival observed in most of the world on 1 January, the first day of the year in the modern Gregorian calendar. 1 January is also New Year's Day on the Julian calendar, but this is not the same day as the Gregorian one. Wh ...
but sometimes as far out as February. Merchandising also varies within
retail chain A chain store or retail chain is a retail outlet in which several locations share a brand, central management and standardized business practices. They have come to dominate the retail and dining markets and many service categories, in many pa ...
s, where stores in places like Buffalo might carry snow blowers, while stores in Florida and southern California might instead carry beach clothing and barbecue grills all year. Coastal-area stores might carry water skiing equipment, while ones near mountain ranges would likely have snow skiing and
snowboarding Snowboarding is a recreational and competitive activity that involves descending a snow-covered surface while standing on a snowboard that is almost always attached to a rider's feet. It features in the Winter Olympic Games and Winter Paralympi ...
gear if there are ski areas nearby.


Retail supply chain

In the
supply chain In commerce, a supply chain is a network of facilities that procure raw materials, transform them into intermediate goods and then final products to customers through a distribution system. It refers to the network of organizations, people, acti ...
, merchandising is the practice of making products in retail outlets available to consumers, primarily by stocking shelves and displays. While this used to be done exclusively by the stores' employees, many retailers have found substantial savings in requiring it to be done by the manufacturer, vendor, or wholesaler that provides the products to the retail store. In the United Kingdom, there are a number of organizations that supply merchandising services to support retail outlets with general stock replenishment and merchandising support in new stores. By doing this, retail stores have been able to substantially reduce the number of employees needed to run the store. While stocking shelves and building displays is often done when the product is delivered, it is increasingly a separate activity from delivering the product. In grocery stores, for example, almost all products delivered directly to the store from a manufacturer or wholesaler will be stocked by the manufacturer's/wholesaler's employee who is a full-time merchandiser. Product categories where this is common are Beverage (all types, alcoholic and non-alcoholic), packaged baked goods (bread and pastries), magazines and books, and health and beauty products. For major food manufacturers in the beverage and baked goods industries, their merchandisers are often the single largest employee group within the company. For nationwide branded goods manufacturers such as The Coca-Cola Company and
PepsiCo PepsiCo, Inc. is an American multinational food, snack, and beverage corporation headquartered in Harrison, New York, in the hamlet of Purchase. PepsiCo's business encompasses all aspects of the food and beverage market. It oversees the manuf ...
, their respective merchandiser work forces number in the thousands.


Licensing

In marketing, one of the definitions of merchandising is the practice in which the brand or image from one product or service is used to sell another. Trademarked brand names, logos, or character images are licensed to manufacturers of products such as toys or clothing, which then make items in or emblazoned with the image of the license, hoping they'll sell better than the same item with no such image.ABC News: Coffins bearing baseball team logos.
(accessed 2007-01-06)
For the owners of the IP ( intellectual property) in question, merchandising is a very popular source of revenue, due to the low cost of letting a third party manufacture the merchandise, while the IP owners collect the merchandising (royalty) fees. In 1903, a year after publishing '' The Tale of Peter Rabbit'', English author Beatrix Potter created the first Peter Rabbit soft toy and registered him at the Patent Office in London, making Peter the oldest licensed fictional character. Erica Wagner of '' The Times'' states, "Beatrix Potter was the first to recognise that content—as we now call the stuff that makes up a book or a film—was only the beginning. In 1903, Peter hopped outside his pages to become a patented soft toy, which gave him the distinction of being not only Mr. McGregor‘s mortal enemy, but also becoming the first licensed character".


Children

Merchandising for children is most prominently seen in connection with
film A film also called a movie, motion picture, moving picture, picture, photoplay or (slang) flick is a work of visual art that simulates experiences and otherwise communicates ideas, stories, perceptions, feelings, beauty, or atmosphere ...
s and
videogames Video games, also known as computer games, are electronic games that involves interaction with a user interface or input device such as a joystick, controller, keyboard, or motion sensing device to generate visual feedback. This feedback ...
, usually those in current release and with television shows oriented towards children. Merchandising, especially in connection with child-oriented films, TV shows and literature, often consists of toys made in the likeness of the show or book’s characters (action figures) or items which they use. This was first seen with the Peter Rabbit soft toy in 1903, with the '' Smithsonian'' magazine stating Beatrix Potter "created a system that continues to benefit all licensed characters, from
Mickey Mouse Mickey Mouse is an animated cartoon Character (arts), character co-created in 1928 by Walt Disney and Ub Iwerks. The longtime mascot of The Walt Disney Company, Mickey is an Anthropomorphism, anthropomorphic mouse who typically wears red sho ...
to
Harry Potter ''Harry Potter'' is a series of seven fantasy literature, fantasy novels written by British author J. K. Rowling. The novels chronicle the lives of a young Magician (fantasy), wizard, Harry Potter (character), Harry Potter, and his friends ...
." However, sometimes it can be the other way around, with the show written to include the toys, as advertising for the merchandise. Sometimes merchandising from a television show can grow far beyond the original show, even lasting decades after the show has largely disappeared from popularity. In other cases, large amounts of merchandise can be generated from a pitifully small amount of source material (
Mashimaro Mashimaro (마시마로) or Yeopki Tokki (엽기토끼 "bizarre rabbit") in Korean and 流氓兔 ("hoodlum rabbit") in Chinese is a South Korean fictional character who resembles a fat rabbit, created by Kim Jae In (김재인). He debuted in a se ...
).


Adult

The most common adult-oriented merchandising is that related to professional sports teams (and their players). A smaller niche in merchandising is the marketing of more adult-oriented products in connection with similarly adult-oriented films and TV shows. This is common especially with the science fiction and
horror Horror may refer to: Arts, entertainment, and media Genres *Horror fiction, a genre of fiction ** Japanese horror, Japanese horror fiction **Korean horror, Korean horror fiction * Horror film, a film genre *Horror comics, comic books focusing o ...
genres. Occasionally, shows which were intended more for children find a following among adults (for example, '' Gundam'' model kits). An early example of this phenomenon was the cartoon character Little Lulu, who became licensed to products for adults, such as Kleenex facial tissue. Sometimes a brand of non-media products can achieve enough recognition and respect that simply putting its name or images on a completely unrelated item can sell that item. An example is Harley-Davidson branded clothing.


Idol goods

Idol goods or idol merchandise are various types of merchandise related to celebrities ("idols"). Consumption of idol goods is a significant part of the idol fandom. Such goods create and reinforce a more physical connection between fans and celebrities. Examples of common idol goods include stationery items, compact discs, photo albums, calendars, telephone cards, T-shirts (see also
concert T-shirt A concert T-shirt is a T-shirt that is associated with a concert or a concert tour, often for a rock or metal band. Bands and musical groups often promote themselves by creating and selling or giving away T-shirts at their shows, tours, and events. ...
), key chains, lapel pins, and various other goods. Virtual idols can be considered an idol good themselves as they can be bought and sold. An idol can have a tremendous effect on sales of merchandise, an example being
David Beckham David Robert Joseph Beckham (; born 2 May 1975) is an English former professional footballer, the current president and co-owner of Inter Miami CF and co-owner of Salford City. Known for his range of passing, crossing ability and bending fr ...
upon his arrival at Real Madrid in 2003, with an Adidas spokesman stating, "Put Beckham's name on any product and Real Madrid didn't stop selling". In the 1960s The Beatles were pioneers in conventional retailing in music, setting up their own retail store in London, Apple Boutique, that sold Beatles merchandise.


See also

* Celebrity branding * Promotional merchandise * Merchandization * Visual merchandising *
Gadget A gadget is a mechanical device or any ingenious article. Gadgets are sometimes referred to as '' gizmos''. History The etymology of the word is disputed. The word first appears as reference to an 18th-century tool in glassmaking that was develo ...
* Tie-in * Shoplifting * List of highest-grossing media franchises


References


Further reading

*


External links


Procter&Gamble merchandising standards
{{Authority control Marketing techniques Promotion and marketing communications Retail processes and techniques no:Spin-off#Salgsvarer