What is a Planogram? Definition, Benefits & How to Use Them

Running a successful retail store is about more than just having great products. How you organize and present those products plays an important role in influencing consumer behavior. For those starting a business, making strategic decisions about product placement is essential to attract customers and drive sales. 

This is where planograms come in. Whether you own a brick-and-mortar store, manage a pop-up shop, or operate a hybrid business, understanding and using planograms can help you maximize sales and improve customer experiences.

What is a Planogram? Definition & Purpose

To better understand how to use one, let’s define a planogram. The definition of a planogram is a visual tool that outlines how to place products within a physical space. The planogram meaning extends beyond just shelves. Retail store planograms help organize window displays and floor plans to create a better store experience.

The term “plan o gram” combines “plan” and “diagram,” highlighting its role in visual merchandising. Businesses use these planograms to effectively display products in retail that will attract customers attention and drive impulse buys. 

These diagrams are not just for traditional retail stores. They are useful in grocery stores, restaurants, and even online stores, where product placement impacts digital customer experiences.

Why Use a Planogram? The Benefits For Retail Businesses

Implementing a planogram provides several advantages:

• Optimized Product Placement: Strategic placement makes high-demand items easy to spot. Products placed at eye level are more likely to capture customer attention.
• Enhanced Visual Appeal: Well-organized shelves create a positive impression and make shopping more enjoyable. An aesthetically pleasing layout can increase the likelihood of repeat visits.
• Improved Inventory Management: Clearly outlining space plans help track stock levels and minimize out-of-stock products.
• Increased Sales Potential: Good product displays guide shoppers through your store and encourage them to add more items to their carts. This approach leverages consumer behavior to drive sales.

Planogram Uses Across Business Types

Planograms are versatile tools used across different industries. Let’s explore their applications:

Retail Stores

In a traditional brick-and-mortar store, retail planograms help businesses design appealing product displays. From small boutiques to large grocery stores, these diagrams help staff keep layouts consistent and ensure products are well-displayed.

Pop-Up Shops

Temporary spaces like pop-ups rely heavily on strategic layout planning. A well-designed planogram ensures maximum use of limited space, attracting foot traffic and enhancing brand visibility.

Restaurants

Restaurants use planograms to streamline operations and optimize seating arrangements. They can help owners monitor staff movement and improve efficiency in the kitchen and dining areas.

Online Stores

Even in digital settings, the principles of planogramming apply. Virtual product displays, such as Amazon’s “frequently bought together” section, emulate the benefits of physical layouts, improving customer experiences and reducing cart abandonment.

How to Create a Planogram: A Step-by-Step Guide

Creating a planogram doesn’t require fancy tools or extensive expertise. Here’s a simple process to get started:

• Measure Your Space: Start by measuring the physical dimensions of your shelves and displays. Note the height, width, and depth to ensure accurate placement of products.
• Plan Product Placement: Determine where each product will go based on factors like product popularity, size, and seasonality. Planograms include layouts for shelves, aisles, and displays to place products where they’ll sell best. Remember, items you want to sell more of should always be at eye level.
• Optimize & Iterate: Once your initial planogram is ready, test its effectiveness. Collect feedback from your sales team and observe how customers interact with the layout. Adjust your design as needed to improve planogram compliance and sales performance.

If you enjoy organizing and using tools like planograms, consider starting a business as a professional organizer. This field allows you to use your skills to help others create functional, efficient spaces in their homes or businesses.

Effective Visual Merchandising Techniques

To make the most of your planogram, incorporate these proven visual merchandising techniques:

• Eye-Level Placement: Products at eye level are more likely to sell. This zone typically falls 4-5 feet off the ground.
• Grouping Complementary Products: Display related items together to encourage multi-item purchases. For example, placing chips near dips can drive impulse buys.
• Traffic Flow Management: Place essentials like milk or cleaning supplies at the back of your store. This strategy forces customers to pass through other aisles, increasing their exposure to more products.

Planogram Tools & Resources

While professional tools like planogram software are available, you can also start with simple tools. As your business grows, consider upgrading to specialized software for advanced insights and inventory management.

Basic Tools For Beginners

If you’re just beginning, investing in expensive software is not necessary. You can create a functional planogram using tools you likely already have, such as:

• Google Drawings or Microsoft Excel: These tools allow you to map out your space plans digitally. They can simplify the process of experimenting with different layouts.
• Pen & Paper: In some cases, the simplest approach works best. Draw your shelves, displays, and products to scale, and adjust as needed.

Using these basic tools is a great way to get familiar with planogramming without the initial financial commitment.

Intermediate Tools For Growing Businesses

As your business expands, managing multiple product displays and locations may become more complex. Consider upgrading to more robust tools like:

• Microsoft Visio or Lucidchart: These programs offer advanced diagramming capabilities that are perfect for creating detailed planograms.
• Planogram Templates: Many websites offer downloadable planogram templates that provide a quick and easy starting point for your layouts.

These intermediate tools offer more flexibility and features. They help you visualize and refine your product placement strategies more effectively.

Professional Planogram Software

For larger businesses or those with more complex inventory needs, professional planogram software is an invaluable investment. Some popular options include:

• RELEX: This software offers powerful features for designing and maintaining retail planograms. It includes tools for analyzing customer behavior and optimizing product placement to boost driving sales.
• One Door: A platform focused on streamlining visual merchandising processes. Helps teams plan quickly, customize promotions, and set up displays accurately, ensuring consistency and efficiency across all store locations.
• Blue Yonder Category Management: This software is ideal for large retailers. It provides detailed insights into inventory management and space optimization.

These planogram programs often come with features like automated compliance checks, sales analytics, and real-time inventory tracking. They’re perfect for businesses looking to maximize the impact of their visual merchandising efforts.

Take Your Retail Strategy to the Next Level

Planograms are essential tools for any business aiming to improve visual merchandising and maximize sales. Organizing your products strategically and maintaining an attractive layout are key. Together, they create a shopping experience that keeps customers coming back.

How Ontario Business Central Can Help

Starting or expanding a retail business involves more than just understanding planograms. Ontario Business Central offers comprehensive support, including business registration, incorporation, and domain name registration. Whether you’re launching a new brick-and-mortar store or testing a pop-up shop, we empower you to succeed.

With 30+ years of experience, Ontario Business Central makes starting a business easier by handling the administrative work. Let us handle your registration so you can focus on what matters most—delighting your customers. Ready to take the next step in your retail journey? Contact Ontario Business Central to get your business off the ground today.

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Ontario Business Central Inc. is not a law firm and cannot provide a legal opinion or advice. This information is to assist you in understanding the requirements of registration within the chosen jurisdiction. It is always recommended, when you have legal or accounting questions that you speak to a qualified professional.