How assortment density affects sales: optimising your catalogue for profit growth

“In retail, it’s not enough just to offer a product — it’s important to create an environment where it sells as effectively as possible.”

— Philip Kotler, marketing expert

Proper inventory management is a key success factor for online stores and suppliers. Optimal assortment density affects sales levels, brand perception, and customer loyalty. However, too high a density can lead to catalog overload and reduced conversion, while too low density can limit choices and cause customer loss. So, where’s the golden mean? Let’s delve into the details.

Contents

1. The impact of assortment width on sales

A wide assortment offers customers a choice, but too many options may trigger the choice paralysis effect.

A study from Columbia University showed that people are less likely to make a purchase if presented with too many choices (Source: Iyengar & Lepper, 2000).

This phenomenon can be explained by cognitive overload: customers fear making the wrong choice and postpone purchasing.

In online stores, this manifests as several issues:

Increased decision-making time. Users spend more time researching products, but it doesn’t always lead to purchases. The more options available, the harder it becomes to decide, resulting in analysis paralysis. Shoppers compare products, read through specifications repeatedly, and ultimately may leave without buying because the choice becomes overly complex.
Lower conversion rates. A customer may leave the website without selecting a product if the decision-making process becomes too complicated. This is particularly relevant in niches with many similar models, such as electronics. If customers aren’t provided with user-friendly filters, recommendations, or popular options, they might simply close the page and go to a competitor.
Sales dispersion. Rather than concentrating demand on top products, businesses spread it across dozens of options, reducing the efficiency of advertising campaigns. Consequently, customer acquisition costs may rise, as advertising budgets get distributed across too wide an assortment, lowering the return on investment.

Excessive variety can also negatively impact offline retail. For example, a study published in the Journal of Consumer Research found that reducing product assortment by 20% increased sales by 10%, as customers found it easier to navigate the shelves.

✅ Solution: Catalog optimization. Instead of offering 10 similar product variants, it’s preferable to present 3–5 optimally differentiated models. This increases the likelihood of a purchase and simplifies the selection process.

How to choose the optimal number of items?

Demand analysis. Which products generate 80% of revenue? Which items are rarely purchased?
Assortment segmentation. If a customer is choosing a smartphone, they’re not looking for 10 models from one brand, but different segments: budget, mid-range, and premium.
A/B testing. Conduct experiments by temporarily removing certain products from the catalog and comparing conversion rates.

Thus, assortment balance is key to increasing sales: too few products result in customer loss, and too many lead to choice paralysis.

2. How Product Display Density Affects Average Order Value

For physical stores, the principle “the more products on the shelf, the higher the sales” doesn’t always hold true. An overloaded display creates a sense of chaos for customers and reduces perceived quality.

According to Nielsen, 65% of shoppers perceive neatly organized displays as a sign of premium quality (Source: Nielsen Shopper Trends).

Online stores face a similar effect due to overloaded interfaces:

Too many products per page → the shopper loses focus. When dozens or even hundreds of items are displayed on one page without clear structure, customers struggle to concentrate on their choice. As a result, they either postpone the purchase or leave the site entirely.
Lack of filters and categories → harder to find the right product. Without convenient filters for brand, price, characteristics, or popularity, users must manually browse through numerous items. This increases search time and lowers satisfaction.
Excessive offers for one product model → price stops being a decisive factor, prompting the customer to postpone purchasing. If customers see too many slightly differing versions of the same product, they may experience uncertainty and start looking for alternative sources of information, including competitors.

In offline retail, overloaded displays can also negatively impact sales.

A study published in the Journal of Consumer Psychology revealed that optimizing shelf layouts can increase sales by 15–20%.

Clean, structured displays convey a premium feel, while chaotic arrangements lower trust in the brand.

✅ Solution: Divide the assortment into logical groups, thoughtful navigation, and visually prioritize popular products. For online stores, this means:

Limiting the number of products displayed per page. Show no more than 20–30 items, with easy navigation between pages.
Clear filters and sorting options. Provide filtering options based on popularity, new arrivals, price, and product features.
Highlighting recommended products. For example, display tags such as “Top Choice” or “Popular Item” to speed up decision-making.

Thus, the correct assortment density and convenient navigation can significantly boost average order value and overall conversion rates.

3. Minimal Assortment: Risk of Losing Customers

An excessively low density of products creates the opposite effect: customers don’t find the desired item and move on to competitors. For example, if an online store offers smartphones but limits the assortment to just two models, customers are likely to leave rather than choose between limited options.

According to Statista, 53% of shoppers leave websites if they don’t find a sufficient variety of products (Source: Statista, 2023).

This is especially critical in niches where personalization matters (clothing, electronics, cosmetics).

A low assortment density can lead to several problems:

Lower average order value. If customers can’t find additional accessories or complementary items, they buy only the essential product. For instance, a customer purchases a smartphone but cannot find a protective case or headphones, causing the store to miss potential extra revenue.
Loss of customer loyalty. If customers repeatedly face product shortages, they stop perceiving the store as a reliable shopping source and switch to competitors.
Difficulties retaining traffic. Even if advertising successfully drives potential buyers to the website, insufficient variety reduces conversion chances. Ultimately, the business spends money on customer acquisition but doesn’t receive the expected return.

Offline stores experience a similar problem in the form of “empty shelves.”

A study published in the Harvard Business Review indicated that inadequate product availability in retail outlets reduces sales by 10-15%, as customers perceive the store as less reliable.

✅ Solution: A minimal assortment must cover the key needs of the target audience. Even if the range is narrow, it should remain balanced.

Using demand data. Regular analysis of top-selling items helps identify which products are critically important for customer retention.
Adding complementary products. If the core assortment is limited, complementing it with accessories can help boost the average order value.
Competitor monitoring. If competitors offer a wider product range, identifying gaps can strategically expand the product lineup.

Thus, an insufficient assortment can severely harm sales, but an effective product-selection strategy can mitigate these risks and retain customers.

Maintaining optimal assortment density is just one way to lead in the competitive race. More valuable tips can be found in our article.

4. Optimal Assortment Density: Balancing Variety and Convenience

Finding the optimal balance between assortment breadth and ease of choice is key to increasing sales.

According to research from Harvard Business Review, an optimally dense catalog can increase sales by 20–30% because customers find it easier to locate desired items and make purchase decisions (Source: HBR, 2021).

An overly crowded catalog can trigger choice overload, while an overly limited assortment reduces customer loyalty. Balance is achieved through structuring, segmentation, and analyzing user behavior.

Typical problems resulting from an unbalanced assortment include:

Excessive choices slow down the buying process. When customers encounter dozens or even hundreds of similar items, they often postpone purchasing to “figure it out later.” This reduces conversion rates and increases the number of abandoned orders.
Lack of structure complicates finding the right product. If products are listed chaotically, without clear categorization or intuitive filters, customers quickly become frustrated and leave.
Inventory turnover issues. Some products might linger in the catalog without selling, while the business wastes budget maintaining a large assortment that doesn’t generate profit.

✅ Solution: Assortment optimization based on user preferences and demand analytics:

Grouping products by usage scenarios. For instance, an electronics store could replace a general “Headphones” category with sections like “Gaming,” “Sports,” or “Work,” helping customers find the right product faster.
Using analytics to identify popular products. If 80% of sales come from 20% of the products, these can be made more visible, while less popular models are gradually phased out.
Regular catalog updates. Outdated products should be replaced with current ones, and temporarily irrelevant items hidden to avoid unnecessary visual clutter.

Thus, balancing assortment variety with convenience directly impacts sales. Optimizing the product range according to real customer needs can boost conversions and average order value.

5. Metrics and Methods for Analyzing Assortment Density

To manage assortment density effectively, it must be measured. Companies that neglect analyzing this metric risk either overloading their catalog with excess products or losing customers due to limited selection. Regular analysis helps achieve a balance between variety and convenience for customers.

Key metrics for assessing assortment density:

Category share within the overall assortment. This metric reveals catalog balance: if one category significantly dominates others, it indicates a disproportionality that may require adjustment.
Assortment depth. Evaluates how many variations of a single product type are presented in a store (e.g., different smartphone models of one brand). Excessive depth may lead to “choice paralysis,” while insufficient depth could cause customer loss.
Assortment width. The number of different product categories (such as smartphones, laptops, accessories). Optimal assortment width allows the store to cover more customer segments without overwhelming the catalog.
Average number of SKUs per category. Helps identify which categories are overloaded and which are understocked, creating potential gaps in the offer.
Inventory turnover ratio. Indicates how quickly products sell and which ones linger in inventory. High turnover suggests good demand and effective inventory management, while low turnover indicates potential issues with pricing, positioning, or the availability of alternative products.

✅ Solution: To effectively manage product assortment and density, it is necessary to:

Regularly analyze the assortment. Using BI tools and demand analytics helps monitor category performance and identify bottlenecks.
Optimize assortment depth and width. Removing slow-moving items from the catalog and adding high-demand categories increases customer satisfaction and sales.
Conduct catalog A/B testing. Analyzing changes in assortment structure helps determine which product arrangements enhance conversions.

Proper use of assortment density metrics helps achieve a balance between variety and convenience for customers, thus increasing average order value and sales effectiveness.

6. Price Monitoring as a Tool for Assortment Optimization

Price monitoring not only allows tracking competitors but also analyzing how well a supplier’s products are represented in online stores. Companies that do not use automated data analysis risk losing market positions, as competitors adapt more quickly to changes in demand and pricing.

Tasks that price monitoring solves in assortment density management include:

Identifying product shortages in stores. If a product is missing in most retail outlets, this may indicate weak distribution or insufficient partner management. Analysis reveals opportunities to strengthen brand presence.
Analyzing brand representation in different stores. Comparing assortment across different retailers shows where the brand holds a strong position and where its influence is minimal. This supports decisions to expand partnerships or enhance marketing efforts.
Identifying retailers with minimal assortments. If a retailer carries only a small portion of a supplier’s product range, it could suggest limited awareness of the full catalog or collaboration with competitors. Monitoring helps detect such cases early and adjust the sales strategy accordingly.
Analyzing assortment stability. Tracking changes in retailers’ catalogs highlights products with stable sales versus those frequently disappearing from shelves. This informs adjustments in supply and marketing strategies.
Identifying seasonal trends and gaps. Price monitoring reveals which products are in high demand during specific periods and which are undervalued. This allows timely adaptation of the assortment to seasonal fluctuations.
Studying price segments. Competitor data analysis identifies market segments oversaturated with products or highlights niches offering unique positioning opportunities.

✅ Solution: Using automated price and assortment monitoring enables:

Rapid identification of gaps in product representation. This improves retailer cooperation and strengthens brand positioning.
Adapting assortment strategy to current market conditions. Flexible catalog management based on monitoring data helps prevent losses due to imbalanced product offerings.
Controlling the competitive landscape and quickly responding to changes. If competitors expand assortments, introduce new models, or lower prices, monitoring enables timely strategic adjustments.

Price monitoring is not merely a competitor-analysis tool; it’s a powerful assortment management mechanism. Its application helps identify weaknesses in product representation and quickly adapt business strategies to boost sales.

Here’s an example of how one of PriceCop’s clients uses monitoring to track the assortment density of their products on the virtual shelves of online stores.

This example shows assortment density reaching 95–100% with a total of 680 product items, whereas even 70% is considered high.

The density of supplier products in stores is a critical factor influencing sales. Excessive assortment reduces conversion rates, while insufficient variety leads to customer loss. The optimal strategy includes a balanced catalog, convenient navigation, and data analysis.

For more details on how to conduct market monitoring, read this article.

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