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The Importance of Measuring Retail Design

Published

10 years ago

November 4, 2014

VMSD Reader

The Importance of Measuring Retail Design

Having understood the power of retail design, it is now necessary to understand the approaches to measure its success.

If You Don't Measure It, You Can't Manage It.

Improving a stores retail design is not purely just to enhance its own image, it is also with the intent to boost sales and increase customer loyalty. Therefore, measuring the outcome of a retail revamp is an essential way to analyze its success. There are five quantitative measurable recommendations for analyzing the success, they are as follows:

5 Measuring Methods

1.Return on Investment (ROI)

This is the most common way to measure the success of retail design. In its most basic form it can be calculated by:

ROI = Net performance / Net cost invested.

When conducting a retail facelift, it is essential to measure the ROI prior to and after the renovation for a valuable analysis to see how it has helped improve sales. It is advisable to monitor the ROI at least one month after completion of the facelift, as typically in the first two weeks a brand might experience a sudden surge in retail sales, due to the hype from the revamp or press coverage.

2.Footfall

Measuring customer traffic allows you to analyze the number of people that enter and walk by your shop. This provides you with an opportunity to determine key ideas such as purchasing opportunities that have been missed and those that have been achieved, which can be used as a method of analyzing how to encourage a passersby to come into your shop, increasing the overall footfall.

3.Average Transaction Size

Analyzing the average transaction size gives you the opportunity to see how many products customers typically purchase. From this, implementations can be enforced to improve this.

4.Average Visit Duration

Calculating the usual time spent by customers in your shop is a good way to examine whether the brand experience you are offering is an effective method.

5.Average Return Frequency

The frequency of returns is an essential way to look at the customer loyalty. The more often your customers return to your shop, the more loyal they are to your brand.

These figures can be used to provide an indication of the success of a retail facelift by being carried out before and after.

The outcome

Effective retail design can have a tangible and far-reaching impact on a business. Evidently, it is essential to go beyond merely furniture planning and functionality of store space, to a place where brands are able to establish an emotional connection and create a memorable experience for consumers.

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