Smarter merchandising, higher conversions: Turning traffic into transactions

Even minor increases in conversion rates can have a major impact on revenue, and operators use techniques such as daypart targeting, data-driven category optimization, product placement strategies, and AI to drive conversion, said Nicholas Banke, director, marketing and insights, at Vistar, a PFG Company. During his presentation on category management and translating consumer trends into smarter merchandising, he emphasized that improving conversions — the act of turning a consumer interaction into a purchase — can pay dividends. Banke offered a simple example: Increasing transactions from zero to just $30 per customer annually can translate to approximately $1,100 in revenue per 100 customers.

To increase conversions, Banke outlined several techniques:

Daypart targeting. Because most workplace markets serve customers from morning through late afternoon, operators should tailor their offerings to attract the most customers during those peak shopping hours. Banke noted that morning (healthy, energy-based items), midday (meal bundles), and afternoon (indulgent or energy-boosting snacks) offer distinct sales opportunities.

Category optimization. Operators can use basket-level data and POS velocity information to optimize SKU selection, co-merchandising and pricing. Operators should keep in mind the 80/20 rule in terms of product selection, category mapping, and positioning of core vs. incremental product tiers.

Product placement. Shelf-level tactics such as positioning high margin or popular items at eye level can drive conversion. Adding signs and otherwise highlighting new products can increase engagement and trial.

AI-recognized consumer insights. The potential of AI to provide foot traffic analysis and enhanced consumer feedback loops could improve conversions further.

During the second half of his presentation, Banke focused on consumer and category trends. As the pandemic recedes and its influence on consumer behavior fully fades, consumers have resumed away-from-home snacking and eating, which is on trend with pre-pandemic levels. Return-to-work mandates continue to bring back more employees to workspaces for at least part of each week.

The inflationary pressures of the post-pandemic years continue to be felt, renewed by tariff concerns and effects in 2025. The number one consumer demand in micro markets is “affordable options,” Banke noted. Operators should explore options such as promotions and bundles to capture price-conscious consumers.

Most micro market visits and purchases are unplanned, said Banke, often motivated by what “looks good.”

Generational preferences also play a role in micro market sales. Gen Z snacks frequently and is influenced by social media trends, often seeking “buzzworthy” products. Millennials are health-conscious and prefer clean-label items. They are likelier to read ingredient lists, often seeking products that align with lifestyle or dietary goals like low sugar or natural ingredients. Gen X, meanwhile, is value-driven, favors trusted brands, and looks for gut-health and functional snacks.

Two final trends influencing consumer purchasing are flavor innovations and better-for-you products. While spicy flavors have been popular for some time, Banke noted, the demand for spicy and spicier products remains. Operators can keep assortments fresh with limited-time offers. Demand for better-for-you options, particularly in the morning, presents opportunities for operators, Banke noted.