Article

GlobalShop: OfficeMax on visual merchandising

The office supply giant talks product development, store design and using personas to understand the customer.

March 21, 2010 by James Bickers — Editor, Networld Alliance

LAS VEGAS — For the nation's third largest office supply retailer, visual consistency is a priority. But according to Chuck Luckenbill, vice president of visual merchandising for the 900-location OfficeMax, his company has no visual merchandisers in the field — they're all back at corporate.

That means he "has to legislate creativity," Luckenbill told a standing-room-only crowd the recent GlobalShop session on "Increasing Store Performance and ROI Through Visual Merchandising."

Luckenbill leads a team whose players include merchandising, product development, branding, marketing and store operations. He said his team is firm on planograms, and demands that store managers execute JLP — "just like picture" — when building displays and placing product. He reported a compliance rate of 90 percent on JLP.

Many large companies use customer profiles and personas when planning product mix and store environment, and OfficeMax's persona is Eve, a woman between 22 and 55 years old. Eve is a business woman, and has children.

Eve cares about five things, Luckenbill said:

1. Inspiration
2. Style and design
3. Organization and efficiency
4. Value
5. Expertise and trust

He said that everything about the OfficeMax experience — in-store displays, product benefits, cleanliness of the environment — is designed to appeal to Eve.

He's not just guessing about what Eve wants and values — the company operates an "Eve panel" of 5,000 consumers. Luckenbill said that 71 percent of the Eve panel say they expect OfficeMax to have "new, interesting and designed products," and that's a factor that largely drives the company's private label initiative.

In 2009, OfficeMax developed 1,800 new packages and 1,000 new products. One-fourth of the total mix is private brands. Recently, the company has debuted product lines in various tiers of quality and price — for instance, the aesthetically slick [IN]PLACE line of folders and filing accessories, which bears the imprimatur of Oprah regular Peter Walsh, and the sleek TUL line of pens. Products are designed with four tiers of quality, and when they hit the shelves, they are stacked in descending order — the best products at eye level, the budget products near the floor.

Luckenbill pointed out that the average customer walks 30 feet every seven seconds, and so his stores are designed with this in mind. That information informs the spacing of endcaps and nested tables, as well as "trendcaps," thematic groups of products that he says fill the role in his company that mannequins fill in fashion retail (i.e. coordinated groupings of unrelated products that show shoppers how well certain things work together).

He closed his presentation with a brief word on the company's POS and product intelligence infrastructure, which he said gives him insight into what is selling the minute it is sold. When a new product or enhancement is launched, he said he typically waits a couple of weeks to get data.

"If the enhancement wasn't doing well, it would be gone in a heartbeat," he said. "We will not keep products that aren't selling."

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