windowdressing

Windowdressing is the practice of presenting goods or information in a way that emphasizes positives and minimizes negatives. The term is used in two main contexts: retail display and corporate finance.

In retail, windowdressing, or visual merchandising, refers to the design and arrangement of storefront windows and in-store displays to attract attention, convey brand identity, and influence shopper behavior. Displays employ lighting, color schemes, props, signage, mannequins, and cross-merchandising to create focal points and encourage impulse purchases. Seasonal themes, coordinated color palettes, and strategic product placement are common techniques. The goal is to draw foot traffic, communicate style or value propositions, and support promotional campaigns. The practice developed with the rise of department stores and shopping districts, where eye-catching windows were used to lure pedestrians.

In finance, windowdressing describes end-of-period actions intended to improve the apparent quality of a portfolio or a company’s financial statements. Techniques may include rebalancing toward higher-performing assets, selling underperformers, and acquiring assets that inflate short-term metrics. While such actions can be legal, they may mislead investors by presenting a rosier picture of performance, risk, or liquidity than is warranted. Regulators and auditors scrutinize window dressing as part of broader concerns about earnings management and truthful reporting.

Criticism of windowdressing centers on its potential to mislead or manipulate perception, whether about consumer value in retail or financial health in business reporting. See also: visual merchandising, earnings management, earnings quality.