He enters a store with a list in his hand. He needs milk, soap, pasta… basic products. He arrives at the shelf of sauces and condiments to buy that can of crushed tomatoes that he usually buys, which is a must-have in his pantry. Suddenly, he stops and his eyes open wide. He finds himself in a tough situation, the problem no buyer wants to face. The store has run out of stock. He searches the back of the shelf. “I might find a hidden can.” But there is nothing there. The buyer, angry, disappointed, thinks about going to another store that might have a greater variety to buy what he needs.
The fact that this story is fictional does not make it less scary: a product that is missing is synonymous with a bad shopping experience.
GS1 Argentina is an organization that has been studying this problem for the last 10 years. Together with chains and suppliers from the mass consumption sector, this organization carries out a study every year to assess missing products in gondolas. The investigation uses methods that have been approved in Latin America and it is conducted in several countries in the region. Four categories are assessed: food, drinks, household care and personal care. The last study, which was completed in 2018, included 23 cities in Argentina and assessed 8200 products in 161 sales floors. This involved over 221k surveys. What did customers say and what do they look for when they go shopping?
The (Bad) Experience of Consumers
6047 people participated in the last GS1 survey. The majority (86%) admit that they generally find the products they want to buy at the point of sale. According to respondents, the products that are most frequently missing are food products (43%), followed by drinks and personal care products (both mentioned by 21% of the respondents). From this study, it is also inferred that consumers tend to be loyal to the place where they frequently shop, or the place where they “like” to go shopping: 50% of those surveyed admit that they mostly shop at that point of sale. A small percentage of shoppers, 15%, state that they always shop at that place. The rest either shop there occasionally (23%) or shop there as well as at other stores (15%). The survey also reflects what customers think of the places where they usually shop: more than half of respondents (59%) rate the store as “good”, and 32% of those surveyed rate it as “excellent”. This assessment is in line with the perception consumers have of the store’s level of restocking. Forty-five percent of respondents think that stock is “very good”, 43% think it is “good” and 7% think it is excellent; only 5% consider it is “regular” or “bad”.
What happens when the store has run out of stock? Thirty-five percent of customers buy a different brand and 20% buy another presentation. Some customers (12%) decide to leave the store without buying anything, and a similar percentage of customers (10%) visit another store from the same chain. The rest (26%) “postpone the purchase”, make the purchase “through a different channel” or “at a different chain”.
The Effort of Retailers
Numbers don’t seem to lie: when shopping, customers prefer good experiences, that is, stores that offer a great variety of products, good-quality items and, above all, no missing products. The faster products are restocked, the better the customer’s loyalty to the store.
Retailers know it and, for that reason, they investigate, they seek to know their customers and take their shopping experience to the next level. They know that the key to a good experience is to always have products in stock.
It is known that Walmart, since 2012, has been having stock problems for several items. One of their “fast” solutions was reducing their inventory: having less to restock less. Users complained and sales dropped drastically. Today, this great supermarket chain is trying innovative solutions, such as cameras in their gondolas and artificial intelligence to check product stock in 50 stores.
In Latin America, companies are gradually incorporating technological solutions to counteract shortage in gondolas and avoid the lack of visual stock. One of the technological solutions that will revolutionize the way inventories are controlled is Stock Control, which was developed by Pusher-POP Smart; this module, which is just one of the solutions offered by this company, works through devices called Stock Beacons, which control the movements of the products in gondolas in real time. In this way, retailers can check traffic in the system’s dashboard: frequency of visits, conversions, addition and removal, suspicious events and movements, among others. It also records videos and can notify shelf stockers automatically when shelves run out of products so that they can be restocked immediately.
Once again, technology comes to the rescue of stores in pursuit of one “dream”: making customers enjoy their shopping experience and helping retailers increase sales.
For more information about the solutions that are available for your shelves, visit pusherpopsmart.com