To gather insights about store layout, product placement, and customer engagement strategies, retailers and brands have long relied on in-store testing. This real-world approach has been considered the gold standard, allowing retail teams to observe actual shopper behavior to adjust planograms, product displays and shelf arrangement directly in the physical space. But a new tool has emerged that challenges this method: virtual store testing.
Virtual store testing enables retailers to test and refine store configurations in a virtual environment—no costly rearrangements or disruptions in a physical space required. Through digital twin simulations that mirror the real-world store, retailers can now explore endless configurations, refine shelf layouts, and test new product placements quickly and cost-effectively. In fact, virtual testing is redefining long-standing practices in category management and customer engagement, potentially challenging even the most trusted in-store assumptions.
In this post, we’ll explore eight surprising ways virtual store testing can reveal new pathways to grocery profitability, shining light on customer preferences, consumer behavior, and overlooked opportunities for growth. Let’s take a closer look at how virtual environments are reshaping our understanding of what works—and what doesn’t—in grocery retail.
Virtual Testing vs. Real-World Testing—Why Data Doesn’t Lie
To understand the value of virtual store testing, it’s essential to recognize why it can offer a more effective approach than traditional, in-store data. Unlike traditional store tests, virtual testing occurs in a controlled setting where retailers can isolate variables, giving a clearer view of how layouts, product placement, and signage affect shopper decisions.
In a physical store, countless factors can interfere with test outcomes: weather, unexpected store traffic, product shortages. These real-world interferences can introduce biases and make it challenging to draw definitive conclusions. Virtual testing, on the other hand, eliminates these unpredictable factors, providing data that is both scalable and repeatable. And because virtual testing allows for testing of new product configurations, shelf layouts, and point-of-sale setups without the high costs and logistics of physically moving inventory, retailers can run many more tests than they could in a real-world store.
This ability to control variables, adjust configurations instantly, and repeat tests as needed gives grocers a quantitative edge. From examining purchase decisions to tracking how product packaging impacts sales, virtual testing provides insights that go beyond traditional assumptions. This data-driven approach makes decision-making faster and more accurate, offering grocers a cost-effective way to optimize for profitability while cutting out the guesswork.
Testing Outside the Box Can May Lead to Surprising Results
Virtual store testing makes it easier to challenge long-held beliefs and to test strategies you might not have considered before. Testing against traditional assumptions in a virtual environment allows you to see what resonates with customers in real time without risk. The resulting data-driven insights will enable you to move beyond gut feeling and base decisions on what’s proven to engage and convert shoppers. The result: a store experience optimized for success.
#1 Is Traditional Product Placement Dying?
For decades, grocery retailers have operated under strict rules, with little variation, about product placement: eye-level shelves for high-margin items, endcaps for promotions, and staple products positioned strategically to increase aisle traffic. These practices, rooted in real-world shopper observations, have long been seen as essential to driving sales. But virtual store tests are turning some of these assumptions on their head, revealing that consumers may be more open to change than previously thought. In fact, some argue that consumers expect and want constant change and that retailers need to continually adapt to keep up.
Virtual testing offers the freedom to explore unconventional product placements that retailers might never try in a physical store. For example, testing lower-shelf placements for best-sellers that are typically placed at eye level might reveal new opportunities for visibility, freeing up prime spaces for newer or seasonal products that might otherwise go unnoticed. And because the test is done in a virtual environment, questioning the long-held “rules” of product placement carries no sales risk.
#2 How Loyal Are Customers, Really?
We often assume that shoppers are steadfastly loyal to their favorite brands, especially in the grocery aisle. And while customer loyalty is important, it doesn’t mean it’s immutable. Virtual testing opens the door to exploring whether, when presented with appealing alternatives, consumers are more open to brand-switching than previously believed.
By creating virtual stores where product placements, shelf layouts, and brand configurations can be adjusted freely, grocery retailers can explore whether repositioning familiar products alongside fresh or niche brands might entice consumers to explore. For grocery managers, this insight could provide an opportunity to showcase new products in ways that encourage variety, leading to higher sales from challenger brands and contributing to a more dynamic customer experience.
#3 Discount Fatigue: Price May Not Be Everything
In a virtual environment where retailers can test the impact of price cuts against variables such as product placement and shelf layout, strategic visibility may have a greater influence on sales than constant promotions. Testing this idea virtually could indicate that discounts and deals lose effectiveness when overused—creating what some call “discount fatigue,” where shoppers take price cuts for granted. Not only does this make discounting a less-effective tool but it also leads to narrower profit margins, eating into the bottom line while boosting the top line.
Virtual testing makes it possible to explore how full-price products at eye level or showcased at key points of sale might attract more engagement than those marked down in less visible sections. This approach could challenge the traditional reliance on discounts by showing that category management and strategic layouts can capture shopper attention and boost sales without the need for continuous promotions.
By rethinking the role of discounts in favor of strategic product development and layout adjustments, grocers could achieve stronger, more sustainable results. With insights from virtual testing, grocers might refocus on creating a customer experience that draws shoppers in through thoughtful design and engagement, rather than relying solely on discounts to drive sales.
#4 The Endcap Myth: Exploring Alternatives to Endcap Displays
For years, endcaps have been thought to capture maximum shopper attention, making them prime real estate for high-margin items or promotions. But virtual store testing offers an opportunity to explore the true role of endcaps in driving sales. What if, in your store, certain products proved just as popular—or even more so—outside these high-cost spaces?
With virtual testing, grocers can experiment by placing products in unconventional spots within a virtual environment and measuring shopper engagement in real time. The data might suggest that shoppers seek out specific items regardless of display location, meaning that those products don’t need the spotlight of an endcap to capture attention. Popular items that shoppers habitually look for—such as staple foods or seasonal products—might perform just as well in other areas, freeing up endcaps for newer or experimental products that may benefit from extra visibility.
This approach enables grocery managers to make informed decisions about allocating shelf layouts and planogram configurations, placing products where they’ll perform best without overspending on prime locations. By analyzing data from virtual store tests, grocers could optimize layouts more strategically, reserving high-demand spots for products that truly need them while exploring nontraditional placements for others.
#5 Stocking Pitfalls: Is Quality Better Than Quantity?
Grocers often assume that stocking more options will drive more sales. But could there be a point where an abundance of choices actually overwhelms shoppers instead of enticing them? Virtual store testing allows retailers to examine whether fewer, carefully curated products could yield better results. By simulating different stocking levels, grocers can observe how shopper behavior shifts in response to a streamlined selection. Would high-turnover items stand out more effectively if not surrounded by an excess of similar products? Could this approach lead to a cleaner, more inviting store layout? Testing in a virtual environment provides a low-risk way to consider how category management can be optimized, balancing inventory to maximize space and profit margins without sacrificing customer satisfaction.
In the end, finding the right balance between quantity and quality could help grocers avoid waste and create a more efficient store layout. Virtual testing invites grocers to explore whether fewer, thoughtfully placed products can lead to higher purchase rates, creating a retail environment that resonates with shoppers.
#6 Will Hyper-Local Layouts Outperform One-Size-Fits-All?
Virtual store testing raises an intriguing possibility: Could hyper-localized merchandising drive stronger engagement and loyalty than traditional uniform store designs? Product loyalty and preferences vary widely based on location and customer demographics, yet many retailers rely on standardized layouts across all stores.
Virtual environments allow grocers to test and adjust layouts in real time, matching the product selection and category management to the tastes of each unique market. Would certain regional brands or ethnic foods perform better in some areas than others? Virtual testing can provide insights into whether localized strategies resonate more with customers, driving purchase decisions that might not occur with a one-size-fits-all approach.
This level of customization even extends to product placement. For instance, would a store in an urban area benefit more from ready-to-eat options, while a suburban store might prioritize bulk items for families? Virtual testing lets grocers experiment with these configurations before bringing them into physical locations, reducing the risk of costly trial and error. By tailoring layouts to local demographics, grocers might increase customer satisfaction and loyalty through a more personalized store environment and shopping experience.
#7 Higher-End Products Are Viable in Low-Income Areas
Conventional wisdom suggests that grocery stores in lower-income areas should focus on affordability, reserving prime shelf space for budget-friendly essentials. Virtual store testing offers grocers a chance to challenge this assumption.
With virtual testing, retailers can observe how shoppers in lower-income areas respond to a range of products, including those typically considered “luxury” or “nonessential.” Could premium snacks, gourmet ingredients, or specialty beverages perform well when placed strategically on prominent shelves? Testing in a virtual environment might reveal that the inclusion of a few higher-end products adds variety and offers a moment of indulgence, appealing to shopper aspirations and encouraging impulse purchases.
For grocery managers, these insights open up possibilities for category management and product selection. Could customers in all economic brackets appreciate having a broader range of choices, even if certain items are bought occasionally rather than regularly? By testing the inclusion of high-end selections in store environments, grocers may discover ways to diversify their offerings and cater to different preferences within a single location, ultimately making better use of shelf space. Rather than restricting options by budget constraints, retailers might enhance the customer journey with offerings that feel thoughtfully curated and inclusive.
Rethinking the Future of Grocery Store Testing with InContext
The only way to find what truly works for your store is to test and evaluate the data.
At InContext, we understand that context in retail isn’t just a buzzword; it’s vital for making smart, impactful decisions. That’s why it’s right there in our name. But how do we reliably gather and apply the context needed to succeed in such a competitive environment? But applying data-driven insights that accurately reflect real-world conditions. We leverage advanced virtual reality technologies and systems to simulate, analyze, and apply real-world scenarios, providing the necessary context for you to make informed decisions the first time around.
Need to understand how store layout affects customer purchasing? ShopperMX, our virtual store platform, allows you to simulate and test merchandising strategies in a digital twin of your store. Through store simulations and shelf testing, we help you refine package design and optimize product placement. By connecting shopper insights with actual shopper behaviors in a virtual environment, we provide the data-driven confidence you need to make impactful decisions without making costly physical changes.
When you’re ready to launch and communicate your in-store plan to stakeholders, InContext’s mobile augmented reality app, SMX GO, gives you a seamless platform to align everyone involved. With virtual and augmented reality, live streaming, 3D videos, and other interactive tools, SMX GO facilitates communication and maximizes engagement. It ensures field representatives, buyers, and other team members are fully aligned on the plan, minimizing compliance barriers and enabling you to execute your marketing strategies efficiently.
If you need to predict the performance of your planogram, InContext’s advanced prediction model delivers accurate, real-time optimization insights. Our Arrangement AI harnesses the power of more than 2 million shopping trips to forecast how your planogram will perform, helping you understand potential sales lift and refine your layout to provide the best customer experience. Continuously updated with the latest consumer behavior trends, this model ensures you’re always making data-informed, confident decisions.
Virtual store testing offers grocery managers unprecedented flexibility and insights, challenging long-standing assumptions about store layouts, product placement, and consumer behavior. By embracing these virtual reality tools and advanced testing methods, grocers can make more-informed, data-driven decisions that optimize shelf layouts, enhance customer engagement, and drive profitability in a changing retail landscape.
