Tips for benchmarking in your business
As the retail landscape in both the digital and physical worlds change, the goal of business owners is to increasingly improve services for their customers. Data and analytics have become more and more important. Sometimes the numbers can be overwhelming, but we continue to ask for more. The key to improving any business is to benchmark and then continuously improve.
This means that you need to set goals, do things that relate directly to your goals and then work hard to improve the numbers. A good way to think about achieving your goal, whether in a bricks and mortar store or online is - pick a number and move it in a positive direction.
Benchmarking is important because it sets a baseline and then continuous points at which you can see improvements or the lack thereof. One can have internal or external benchmarks. Depending on your goal you will use different measures and techniques. Ideally you will use external data around your competition and partners to help guide your analysis. Benchmarking is not a once off process and should be used regularly for best results. Here is a short guide on how to think about your benchmarking process:
Data can be gathered in many ways from multiple sources. The key is to make sure you have a goal and that whatever you are aiming to achieve, it can be measured. Many times business will set goals which are very broad and might not be very conducive to learning. For example, a goal of Increasing In-Store Revenue is very broad and although easy to measure, the fact that it isn’t focused means that the data you gather and review will be broad as well.
Using the same example, think about what things your team or business does on a daily basis to generate revenue. Do you run specific types of digital campaigns to draw traffic to shops? Are you utilising the walkway in front of your store and the store window to the best of your ability? Do you run events at your store location or at other locations? Do you communicate with your best customers regularly? These are all things that can be measured and reviewed and they should lead to an increase in revenue if you work on improving them.
The next step is to gather the data that will be relevant to your goals. Remember that the data you gather may be internal or external data and sometimes a combination. Depending on the nature of your competitive landscape, you should make sure you are gathering data that allows you to compare the information in a useful way. For example, if some of your competitors are much larger than you or have many more stores than you, looking at certain data (ie margin numbers) may not be useful. Make sure you are monitoring numbers that in most cases relate directly to the challenge or goal.
The data gathering and competition review process may lead you to new conclusions and may even give you some great ideas of what you can change. Remember to think strategically when gathering data. Looking at your competitors may give you insights into how they are doing thing. Looking at retailers that have a different niche or service may give you new ideas about processes or best practices that you should adopt. Review what the market leaders are doing as they are the best in their field at the moment. If you can understand and learn from the best, it may give you a better chance at being one of the best.
If you are interested in understanding your in-store operations and increasing revenue Kepler might be able to help you. Our sensors allow you to understand your daily foot traffic and the effects of your in-store marketing. We can also help you benchmark between and across all of your stores.
You can follow us on twitter at @KeplerAnalytics, call us: 1800 300 892 or email us at: email@example.com. At Kepler we believe that privacy is most important. Secondly, understanding your foot traffic and visual merchandising is the start to bridging the gap between the physical and digital. Customer behaviour can help you see what types of communications are working. Linking your foot traffic to digital and traditional marketing campaigns will allow you to see how your marketing efforts actually affect sales. Our goal is to grow your Revenue! As always, do your research and use a solution that helps you achieve the goals of each new project.