Online Planograms and Web 2.0 technologies

by Deepak Sharma on Sunday, February 03, 2008

Just finished reading a very informative article by Internet Retailer on web-enabled execution management systems for distributing and managing planograms. The article talks of how Borders is managing changes to the store shelves using online plaongrams which are tied to the workforce management applications.

..Borders and other retailers are deploying web-enabled execution management systems for distributing and managing planograms—graphical layouts of store selling space that show exactly how products are to be displayed on shelves—along with other store operations plans and policies.

And thanks to web technology, planograms have become universally accessible and more user-friendly, with graphical user interfaces that let merchandise managers at suppliers and retailers drag and drop product images into shelf outlines to illustrate how products should appear in stores. Borders and other retailers distribute planograms to stores as part of online execution management systems designed to ensure that store employees execute planograms as well as other store operating procedures as planned by headquarters.


Now, however, store planograms are becoming more effective as part of broader store execution management systems. These systems incorporate web and other technologies that allocate shelf or floor space for each product and connect with applications that assign tasks to store employees related to displaying products. In addition, integrating these systems with labor management and inventory management applications enables retailers to ensure product display needs are supported by available staff and inventory. Distribution in a web-enabled, integrated environment makes planograms more effective, experts say.

The combined technology creates planograms that determine product depth and location by store based on available shelf space along with objectives such as expected profit margins and inventory turns of each product, with the fastest-moving, highest margin products usually getting the most space. But the ability of local store managers to inject their knowledge of local market demand and current store layouts also is crucial. Universal web access to planograms enables chains to easily include and leverage local management expertise, experts say. “Local retailers can take a planogram and make it right for their stores,” says Paul Waldron, Gladson’s executive vice president.

The graphical, drag-and-drop interface of planograms makes them relatively easy to use by store managers and corporate merchandise managers, who typically attend corporate demonstrations on how to check inventory and planned sales data to configure a picture of how products will appear on store shelves, Waldron says. These demonstrations help store managers learn, for example, how to alter planograms initially designed by suppliers. Once planograms are completed, designated store personnel can view them online or print them out as easy-to-follow guides for displaying products, Waldron adds.

The article makes me think the usage of Web 2.0 technologies such as Rich Internet Applications (RIAs) of the likes offered by using Microsoft Silverlight and AJAX support will aid in resolving problems as presented by the article. With .NET programming models also behind such technologies, it should be very easy to integrate with other Retail applications such as Workforce management systems. It should be also easy to optimize the performance of retail shelf space using such technologies thus giving additional benefits to the retailers.

One comment

I have been in the space management business for 15 years, and I agree with your assertion that delivery of planograms is an important element. However, my experience tells me this is less of an issue as getting the right assortment into the right sized planogram. One thing I have always noted was that when you ask people why they have 12 feet of canned tomatoes or 8 feet of packaged cheese, they sort of look at you, shrug, and say, “I don’t know, we always have.” And this has always disturbed me, because it categories are not the right size to meet demand, and the assortment on that planogram is not tuned to demand, then no matter how good a delivery system you have for planograms, the sales per foot are not going to be where the retailer really wants them – and that’s the whole reason for planogramming in the first place.

I have found a very interesting company called Retail Optimization (ROI) ( that has a brilliant system that assorts every category in a store and re-sizes every planogram all at once. In a matter of a few minutes, new stores can be created, old stores re-sized, etc. It is a hosted system that uses the retailer’s own data and drives the planogram production process. It by-passes the bottleneck in Category Management – one category reviewed at a time, by doing all categories for all stores simultaneously. It is fully scalable to any size retailer.

I think you should check it out.

by Anonymous on 8:24 AM. #