What is a Planogram and How to Read It?
Planograms are one of the most powerful yet underrated tools in the retail industry. If you’ve ever walked through a grocery store and noticed that certain products are always at eye level or grouped together in a logical way, you’ve seen the effects of a planogram in action. A planogram is much more than a diagram—it’s a strategic guide that can influence customer behavior, boost sales, and maximize store efficiency.
Table of Contents
This article is designed to give you a complete overview of planograms, including their meaning, importance, how to read them, and best practices. You can use the links below to jump to any section quickly.
- What is a Planogram?
- Why are Planograms Important?
- How to Read a Planogram
- Example of a Planogram
- Best Practices for Using Planograms
- Taking Action with Planograms
- FAQ
What is a Planogram?
To truly understand how planograms work, it helps to start with the basics. A planogram is essentially a retail map that determines how products should be arranged on shelves for maximum impact.
Definition of a Planogram
A planogram is a visual representation that guides retailers on how to place products on shelves. It defines where each product belongs, how many units should face the customer, and how categories should be grouped together. By setting clear rules for shelf layouts, a planogram helps eliminate guesswork in merchandising.
Planograms can be designed for a single shelf, an entire aisle, or even a whole store. They are essential because they combine strategy with structure, ensuring that space is used effectively and that high-demand products receive maximum visibility. In today’s competitive retail landscape, a well-crafted planogram can directly influence sales performance.
Who Uses Planograms?
Planograms are used by many roles within the retail sector. Merchandisers rely on them to organize displays in a way that encourages impulse buying. Category managers use them to oversee product groups and make data-driven decisions about where items should be placed. Suppliers and brands also value planograms because they help secure premium shelf space.
Even small businesses can benefit from using simple planograms. By applying these layouts, independent shops can maximize limited space, reduce clutter, and create a shopping environment that feels organized and professional. Whether for a supermarket chain or a local boutique, planograms are a universal tool for retail success.
Why are Planograms Important?
Planograms are more than just store layouts—they are strategic tools that influence how customers shop and how retailers manage their operations. Both retailers and customers gain significant advantages from structured product placement.
Benefits for Retailers
Retailers use planograms to drive profitability and efficiency. By carefully planning where products go, stores can ensure high-demand items are positioned in prime locations. This leads to higher sales and improved use of shelf space. Planograms also make it easier to track stock and reduce waste by avoiding poor product placement.
Another key benefit for retailers is consistency. When multiple store locations follow the same planogram, customers enjoy a uniform shopping experience. It also makes it easier for suppliers and staff to understand product placement, which saves time and reduces confusion. Ultimately, planograms create a clear structure that boosts operational performance.
Benefits for Customers
From the shopper’s perspective, a planogram makes the retail experience easier and more enjoyable. Products are grouped logically, so customers spend less time searching and more time shopping. Eye-level placement of popular items ensures that bestsellers are easy to find, which increases customer satisfaction.
Planograms also enhance discovery. By organizing products into meaningful categories and adjacencies, retailers can expose customers to complementary items they might not have considered before. This not only improves the shopping journey but also increases the chances of upselling and cross-selling.
How to Read a Planogram
Reading a planogram may look intimidating at first, but once you understand the structure, it becomes much simpler. The key is knowing what symbols and instructions to focus on.
Core Components
Every planogram is built around core elements. These include the product placement, the facing count, and the shelf capacity. Each of these details ensures that shelves are stocked in a way that balances visibility and efficiency.
For example, the facing count shows how many units of a product should be visible to the shopper. Shelf capacity prevents overstocking by setting clear limits. Together, these components provide retailers with a reliable framework for maintaining attractive and organized shelves.
Visual Cues and Symbols
Planograms often use labels, diagrams, and other symbols to make implementation easier for store staff. These visual cues highlight important factors like which products should sit side by side, which should be at eye level, and which belong in bottom-tier locations.
By paying attention to these cues, staff can quickly stock shelves without mistakes. Visual instructions also help retailers maintain consistency across different stores, ensuring that no matter where a customer shops, the experience feels familiar and predictable.
Example of a Planogram
Examples make planograms easier to understand. Let’s look at a real-world case: the snack aisle. This is one of the most common sections where planograms are applied because snack sales rely heavily on visibility and impulse purchases.
Snack Aisle Example
In a snack aisle planogram, chips and pretzels are usually grouped together. The most popular flavors, like salted chips or cheese puffs, are given more facings. This ensures they are highly visible and easy to grab, which directly drives sales.
Less popular or seasonal products are placed on lower shelves with fewer facings. This strategic arrangement keeps the focus on high-performing items while still offering variety for customers who want alternatives.
Cross-Selling Opportunities
Planograms are also powerful tools for cross-selling. For example, chips may be placed near dips and salsas to encourage add-on purchases. Similarly, energy drinks might be positioned next to protein bars for customers looking for a quick snack-and-drink combo.
These adjacencies are not accidental—they are carefully planned to boost basket size. By leveraging cross-selling strategies, retailers can increase average transaction value while making the shopping experience more convenient for customers.
Best Practices for Using Planograms
Simply having a planogram is not enough. To unlock its full potential, retailers need to follow best practices and continuously refine their approach based on data and customer feedback.
Data-Driven Adjustments
One of the most effective ways to use planograms is to base them on sales data. Retailers should regularly analyze which products are performing best and adjust facings accordingly. Seasonal trends, promotional campaigns, and regional preferences should also influence planogram updates.
Data-driven adjustments ensure that retailers maximize profitability. Instead of guessing where products should go, decisions are backed by evidence, which leads to better outcomes both in terms of sales and customer experience.
Training and Execution
Even the most detailed planogram can fail if staff are not trained properly. Employees must understand how to interpret layouts and follow instructions accurately. Retailers should provide training and simple guides to make compliance easier.
Execution should also be monitored through regular audits. Compliance checks help ensure shelves match the planogram design. If problems are identified, quick corrections keep stores running smoothly and consistently across locations.
Taking Action with Planograms
Planograms are only effective if retailers commit to using them consistently. With the right implementation strategy, they can transform how stores operate and how customers shop.
Implementing Planograms in Your Store
Retailers should start by applying planograms to high-traffic areas like checkouts or promotional displays. These spots provide the quickest insights into how effective a planogram can be. Once successful, the strategy can expand to other parts of the store.
Implementation should also be a collaborative effort. By involving suppliers, managers, and staff, retailers can create more effective layouts that balance business goals with customer needs.
Adapting Planograms Over Time
Planograms are not static documents. They should evolve as customer preferences, market trends, and product lines change. A store that adapts its layouts regularly will stay competitive and relevant.
Retailers should schedule periodic reviews of planograms, update them for new launches, and tweak them to match shifting consumer demand. This flexibility ensures that planograms remain powerful long-term tools instead of one-time strategies.
FAQ
Who creates a planogram?
Planograms are typically created by merchandisers, category managers, or suppliers. They use retail analytics and software tools to decide how products should be displayed. Their role is to balance business goals with customer-friendly layouts.
Are planograms the same for all stores?
No, planograms are not always identical across stores. While large retail chains often use standardized layouts, smaller outlets may adjust based on local customer preferences. This helps tailor the shopping experience to the specific market.
How often should planograms be updated?
Most retailers refresh planograms at least seasonally. This ensures that layouts reflect holidays, trends, and new product launches. However, updates may also happen monthly in highly competitive markets.
What software is used to make planograms?
Retailers commonly use specialized software such as Blue Yonder (formerly JDA), SmartDraw, and DotActiv. These platforms make it easy to create detailed layouts and share them with staff across multiple locations.
Can small businesses use planograms?
Yes, planograms are not just for big retail chains. Small businesses can benefit by creating simplified versions that maximize limited space and highlight their bestsellers. This makes shelves look more organized and attractive to customers.
