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Retailers are increasingly selling returned products as open-box along with their new product offerings. Whereas some retailers position open-box products side-by-side with their new counterparts in the assortment (i.e., side-by-side strategy), other retailers position them separately in a different part of the retail space/website (i.e., separate strategy). We conduct multimethodology research to investigate the effectiveness of these two visual merchandising strategies. First, using a choice-based conjoint design in a controlled behavioral experiment, we identify how the two strategies affect the perceived value of new products. Next, using proprietary data from a retailer that has implemented both strategies across different stores, we empirically test the impact of each strategy on new product sales and returns under real market conditions. Finally, we extend our empirical analysis to prescribe how retailers can identify the right visual merchandising strategy for a given product profile. Overall, our results reveal a novel trade-off between the two visual merchandising strategies. With respect to retail revenue, the separate strategy outperforms the side-by-side strategy as we find that new product sales are higher with the separate strategy. However, with respect to retail cost, the side-by-side strategy outperforms the separate strategy as we find that new product returns are lower with the side-by-side strategy. Our extended analysis reveals that this tradeoff varies by product profile. Using counterfactual analysis, we further demonstrate that customizing the visual merchandising strategy by product mix could increase profit by 3.2% at the focal retailer. This paper was accepted by Jeannette Song, operations management. Supplemental Material: The data files and online appendices are available at https://doi.org/10.1287/mnsc.2023.4786. [ABSTRACT FROM AUTHOR]

Retail is a profit-driven, highly competitive industry. Customers expect retailers to provide appropriate assortment sets and excellent product visibility. The aim of this study was to develop and examine two models for optimising category-level shelf space management that maximise a retailer's profit. The authors developed two shelf space allocation problem models. The first model combines three sets of constraints: shelf, product, and product group constraints, while the second model enlarges the first with the multi-shelves constraints. The study showed that this approach gives an optimal solution in a very short time (approximately 3 seconds on average and less than a second in 93 of the 134 instances for the first, and in 84 of the 146 instances in the second problem) for largescale instances, which in most of the test cases is even less than a second. First, non-linear formulations of both problems were presented. Next, the authors proposed to use and adjust linearization techniques which allow transforming both problems into linear ones, thus obtaining the optimal solutions. Finally, both problems were solved using the CPLEX solver, the computational results were provided. [ABSTRACT FROM AUTHOR]

Drawing on 55 interviews with executives across five online fashion retailers, this paper explores the challenges of price setting and management. We develop a descriptive model of 'locked-in' pricing practice to explain organisational routines focused on cost-plus pricing, alignment with competitor prices and historical pricing. Drivers include the complex and uncertain outcomes of pricing, and lack of investment in leading-edge pricing methodologies, together with inadequate training and pricing ownership. Outcomes comprise an aversion to price risk-taking, sees decisions guided by heuristics and a lack of openness to alternative pricing methods. We offer implications for pricing practice to overcome these locked-in behaviours and suggest that research addresses challenges encountered in the implementation of new pricing techniques in organisational settings to narrow the gap between theory and practice. [ABSTRACT FROM AUTHOR]

This study explored U.S. retailers' unique merchandising strategies for recycled clothing based on a logistic regression analysis of 16,000 Stock keeping Units of apparel items sold in the U.S. retail market from 2018 to 2021. The statistical analysis shows that U.S. retailers adopt distinct product assortment strategies for clothing made from recycled materials in terms of colours, design patterns, and product categories, compared with regular new clothing. Also, U.S. retailers were statistically more likely to price recycled clothing lower than the market average but more likely to target them for the luxury and premium market segments. The study's findings create timely new knowledge about the business aspects of clothing circularity and reveal the necessity of improving recycling technologies and changing consumers' perceptions of recycled clothing's values. [ABSTRACT FROM AUTHOR]

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Background: Modern retail is experiencing an accelerated transformation with online sales growth, further accelerated by the COVID-19 pandemic. Nevertheless, physical stores, especially grocery stores, are still the key to retail business and are likely to remain so for the foreseeable future. Competition among retailers is becoming more pronounced and aggressive, and the expectations of modern consumers from retailers are stronger and more precise - they require the creativity of retailers in attracting and motivating them to enter their stores and return. Once consumers are in the store, the goal of retailers is to make them buy as much as possible. In modern retail, visual merchandising has become one of the crucial factors on the supply side by achieving a comfortable in-store environment and directing customers toward targeted shopping behaviour. The aim of this paper is to investigate which factors of visual merchandising are successful in encouraging impulsive consumer buying. Methods: The article conducted an extensive review of the previous literature, while the primary research was conducted on 226 respondents, people who participated in purchases in large retail grocery stores (primarily hypermarkets), to conclude the factors influencing visual merchandising on impulsive consumer buying. Results: The results of the regression analysis indicate that there is a statistically significant positive impact of secondary displays, price promotional labels, and in-store music on impulsive purchases, while the availability of prices over the Internet and weekly promotional catalogs have a negative impact on impulsive purchases. Conclusions: This research provides clear instructions to grocery retailers, and their suppliers (manufacturers and distributors) who place their products in their stores about elements of visual merchandising that can significantly affect consumers' impulsive buying and generate additional revenue. Although retailers receive direct positive feedback, it is also of equal importance for manufacturers (manufacturing brands), as they often participate in in-store visual merchandising processes. [ABSTRACT FROM AUTHOR]

Purpose: The purpose of this study is to investigate the conditions under which small independent retailers can improve their business performance by adopting a merchandising information orientation and strategically integrating into retailer buying groups. Design/methodology/approach: This study tests hypotheses using a hierarchical multiple regression model and data obtained from 241 supermarket retailers that are existing members of buying groups in Japan. Findings: The results indicate that merchandising information orientation alone may not be a beneficial strategy for small independent retailers to improve their business performance; however, by combining a merchandising information strategy with strong strategic integration with a buying group, optimal benefits can be achieved. Practical implications: The findings highlight the potential benefits small independent retailers can gain from buying groups when pursuing a merchandising information orientation, which may prompt such retailers to actively integrate the policies and activities of the buying group into their business strategy. Originality/value: The authors conceptualise retailers' merchandising information in a model that demonstrates the link between a firm's information strategy and its performance from the perspective of resource-based theory. Thus, this study advances the knowledge of the strategic behaviours of small independent retailers and provides valuable information for buying groups in the retail sector. [ABSTRACT FROM AUTHOR]

Purpose: This paper aims to elucidate some of the complexity around food consumption by drawing from neuroscience research of food as a motivated choice (i.e. a neurobehavioral process sensitive to dopaminergic response to food and environmental cues such as marketing). The authors explore the single and compounded effect of the motivational salience of food's intrinsic reinforcing value tied to its sugar content and that of two marketing food cues, price and in-store display, on actual consumer purchase behavior. Design/methodology/approach: The authors test the above hypotheses in two perceived "healthy" product categories with a wide distribution of sugar content. The authors estimate a within-category model using three years of retail transaction data to test the effect on weekly sales. Findings: The authors confirm the single effect of each of food's and marketing cues' motivational salience as well as their compounded effect with high-motivational-salience food being less price elastic and more susceptible to in-store display activities. Research limitations/implications: This research highlights the need to complement current reliance on unhealthy/healthy perception with finer grained objective evidence linked to the formulation of the food itself and the marketing applied to them. Practical implications: The present study findings may help marketing managers and policymakers develop better targeted pricing and display strategies for low- and high-motivational-salience food, attempting to strike a better balance between consumer welfare and commercial performance. Originality/value: This paper is one of the few that links real-world market outcomes to predictions derived from a unique combination of consumer neuroscience and neurobiology of food, advancing data-driven decisions. [ABSTRACT FROM AUTHOR]