When you walk into a large retail clothing store and see a wide variety of scarves adorning the shelves, the given display is not haphazardly composed. In fact, the placement of silk, cashmere or cotton and in which hues is all part of a large merchandising design. Product placement is just one merchandising technique in the broader marketing scheme. The differences between merchandising and marketing are subtle but still pronounced.
Merchandising is the direct sales pitch to the consumer conducted in an immediate, often face-to-face manner. Thus, display cases, in-house consulting and sample issuance are just a few examples of merchandising techniques. The goal of merchandising is to compel the consumer to buy the product. Merchandising seizes on the typically brief opportunity to sell directly to the customer; the parties responsible for successful merchandising include the salesperson and the layout of the store itself. The salesperson engages directly with the customer by providing a sales pitch or demos of the product. The layout of the store is a highly influential method of merchandising: Having a product directly at eye level, for example, can make the difference between a sale or the customer not seeing it and therefore walking away.
Merchandising is a subset of marketing. Marketing has several other arenas that do not overlap with merchandising. For instance, marketing also entails how to distribute the product and how best to package the item. Gathering data is another marketing field, from issuing surveys to holding consumer focus groups. Other issues include in-house marketing. This pertains to devising strategy, assessing which price is best for the product and outlining the objectives of campaigns, promotions and other marketing endeavors.
Without the other disciplines within marketing, merchandising would not be effective. For example, if a company has not assessed which audience will be most desiring of the item, the business cannot effectively pitch its wares within the retail store. Likewise, without proper analysis of how display cases boost sales or the mannerisms adopted by customer service representatives to capitalize on sales, many unrelated fields of marketing cease to be effective. Indeed, merchandising is at the tail end of the marketing chain. While the first links include product design, packaging considerations, distribution and ad campaigns, merchandising is the most time-sensitive links. Businesses have a fleeting moment by which to persuade the consumer to take the item to the cash register.
Merchandising applies only to a retail setting, whereas marketing applies to most every business, including financial services, tourism and hospitality. In order to merchandise, companies must have a tangible product to offer the consumer. Therefore, service-based industries do not engage in merchandising due to the lack of merchandise, unless the industry sells apparel or products related to its industry, such as sports jerseys for athletic teams.