Last week we looked at the very strong profit performance McDonald’s has recorded as a result of the significant investment in store refurbishments – a pleasantly linear story of cause and effect where investment creates a great shopper experience, delivering a tangible profit improvement for shareholders.
I focussed on two of the four leading indicators we use to measure improvements in shopper experience: “increased frequency of visit” and “average spend”. Those are always the two key – and most easily measurable – indicators of improved shopper experience. Today we’ll look at the third and fourth: “linger time” and “post purchase experience”.
These two are far more difficult to measure, so we’ll try to break them down via example and anecdote, as they both require a commitment to do it right, and specialist resource to bring it alive.
“Linger time” grows only when shoppers feel very comfortable and happy in a retail environment. They relax, become more open-minded and much more likely to experiment, trial new things and spend money on things they never planned to buy.
To illustrate this, let’s play back your experiences of lingering in a great shopping environment.
We’ll use an example that’s stood the test of time. It’s been around since the idea of buying stuff in one place at a low price and selling it in another place at a higher price was first realised: the market, bazaar, souk or marché.
Each of us can remember wandering around a market, from The Grand Bazaar in Istanbul, Mutrah Souk in Muscat, the floating markets in Bangkok, Prahan markets in Melbourne or Salamanca Markets in Hobart.
You were relaxed and open-minded, in a happy place without any time pressures. Did you linger and purchase things you didn’t need at prices you normally wouldn’t pay? Probably. But how can you measure this?
To my knowledge there’s only one company that has a developed competency and heritage in this area.
Envirosell out of New York has been capturing shoppers in stores on video in every type of retail store for a couple of decades now. They have countless reels of video footage of shoppers walking into stores, slowing down in the “decompression zone”, relaxing and then spending a long time browsing and shopping. Conversely they have footage in other retail environments of shoppers entering a store, slowing down in the decompression zone, turning, frowning and searching, stopping, speeding up, looking confusedly and then exiting in just seconds.
In the US Envirosell has been able to effectively capture and measure the cause and effect of increased linger time to increased basket size. This measured linger time in store translates directly into sales increases.
Measuring shopper experience post purchase, is not new, but does require a structure, discipline and technology to do it well. “Well” is defined by immediacy of action at the micro level; what you do with individual shoppers’ feedback in the hours after they have left the store and told you about their experience. Sounds a bit warm and fuzzy, but let me give you a real example of a global benchmark in measuring, managing and then improving the shopper experience.
The example is a client of CROSSMARK’s, and what they are doing, how they are doing it and the seriousness with which they take the data puts them at a significant competitive advantage in their space, so I will not mention them by name. I estimate that more than 50% of readers will be in a relationship with the company, so it’s very real and mainstream.
So what are they doing? Via links with their point of sale/back office systems, they are tracking shopper transactions in stores in real time. As soon as the transaction is complete, and often within minutes of leaving the store, the shopper is phoned and asked a small number of very targetted questions about their experience, and asked for any other feedback on their views on how their experience could’ve been made better.
This in itself is world-class. It’s immediate feedback that can be used quickly to improve the shopper experience in that store for future shoppers on a macro scale. But taking it to the next level, and with the involvement of the CEO, at a micro level the company now has the mandate to correct that individual’s shopper experience if it hasn’t been optimal.
If the shopper didn’t get what they came in to buy, missed a promotional buy due to it being out of stock, or had a poor experience with a store staff member, these things can be corrected and a poor shopping experience turned into a great one. And guess what? They’ll come back to that store, linger longer, spend more and tell their friends about it.
What blew me away about this was not just the excellent thought and the great technology, but the fact that at CEO level the question was asked “and what did we do for that individual shopper to make things right?”
Sadly, throughout my career across 40 countries I have seen shopper research consolidated into graphs and median experiences and clusters of feedback types. It is very rare that the CEO takes the time to understand what happened to one of their shoppers and empowers the wider company to improve things.
In his role as CEO of CROSSMARK, Kevin Moore looks at the world of retailing from grocery to pharmacy, bottle shops to car dealers, corner store to department stores. In this insightful blog, Kevin covers retail news, ideas, companies and emerging opportunities in Australia, NZ, the US and Europe. His international career in sales and marketing has seen him responsible for business in over 40 countries, which has earned him grey hair and a wealth of expertise in international retailers and brands. CROSSMARK Asia Pacific is Australasia’s largest provider of retail marketing services, consulting to and servicing some of Australasia’s biggest retailers and manufacturers.
Smart Company is the leading online publication in Australia for free news, information and resources catering to Australia’s entrepreneurs, small and medium business owners and business managers.
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