Company News • 29.09.2014
How to measure the impact of your visual merchandising
Many customers make judgements about a brand based on its window displays
The store window is the first opportunity the retailer has to connect with the shopper, encouraging them into the store and hopefully guiding them towards a purchase. On an increasingly competitive high street, getting visual merchandising right is crucial to differentiation, as well as being key to making a first impression with marketing campaigns or seasonal promotions.
Not only can strong visual merchandising encourage brand loyalty, but it can also define the identity of a brand. Many of us make judgements about a brand based on the quality and imagination demonstrated through its window displays – and disappointing the customer at the point of entry could have a very damaging effect on sales.
Here are three key ways to measure the impact of your visual merchandising campaigns:
1. Make visual merchandising measurable
Retailers must be able to measure the effectiveness of their visual merchandising. The effect on the bottom line needs to be an analysis of whether a store’s investment in creativity is actually paying off.
Retail analytics technologies make visual merchandising more measurable, enabling brands to assess the effectiveness of their campaigns both in their windows and in store. For example, retailers can gain insight into customer journeys in-store and track how they affect subsequent conversion rates.
Using location based analytics, retailers can also measure the impact on store performance every time they change their window or promotional displays - analysing their impact on customer draw rates, conversion rates and average transaction rates. Campaigns can be tweaked or changed entirely if they are proven to be ineffective.
2. Constantly monitor performance
In order to derive the maximum benefit, retailers should measure performance against previous months, weeks or seasons for comparative and future planning purposes. Brands can also utilise retail analytics to examine which displays work best across different territories and cultures, instead of adopting a ‘one size fits all’ approach.
One major shoe retailer for example was able to identify and resolve a significant issue by using location based analytics. While its traffic flow and hence opportunity remained consistent, analysis showed that the store’s draw rate was in continual decline. It transpired that the window display had not changed for three weeks. There was a direct correlation between refreshed window displays and an increase in the draw rate. Only through gaining accurate insight into the draw rate was the retailer able to pinpoint the problem.
3. Tie everything into your three profit pillars
Retailers must measure everything in relation to its impact on the three key profit pillars:
- Draw them in – retailers can view the number of passers-by who stop to look at the window display, then dig deeper to see the percentage that ignored it versus those who walked in.
- Get them to buy – brands can analyse their abandonment rate. How many people are walking into the store and then immediately leaving? What is the average time to purchase? This can be measured by the time it takes for customers to move from the entrance to the checkout. Once patterns are determined in-store, retailers can ensure that there are enough staff on duty to keep queuing times to a minimum.
- Persuade them to buy more – The longer a customer spends in a store the more likely they are to make a purchase. Retail analytics deliver insight into average dwell times, answering questions such as do any increases correlate with the visual merchandising campaigns? Analytics also goes further to extrapolate a retailer’s Gross Shopping Hours, which takes into account specific shopper behaviour patterns such as visitor numbers and dwell times, combining them into a metric that can be produced daily or weekly. The Gross Shopping Hours metric has been verified as having a higher than 90 percent correlation to retail sales.
Visual merchandising is a key component in a retailer’s sales strategy yet it has historically been hard to measure. Technology exists today that can make merchandising accountable – demonstrating just how much the creativity of the visual merchandising team contributes to overall sales.
channels: data management, data analysis, customer counting
