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For years, Same Store Sales (SSS) has been the go-to metric for retailers to gauge store performance. And for good reason—it offers an accurate picture of revenue growth while revealing insights into customer satisfaction and in-store experiences. But with today’s retail world brimming with fierce competition, ever-changing customer preferences, and the push toward digitization, focusing on the basics—like improving same-store sales—has never been more crucial. Let’s dive into why this metric still matters and how brands can leverage it to stay ahead.
Same Store Sales or comparable-store sales is simply a sales comparison for a set of stores over a specific period. For instance, it allows brands to compare third-quarter revenue for 2019 with third-quarter revenue for 2017. If the figures for the same stores have increased from the previous year, then it means that the company is moving in the right direction. So it is important for companies to keep an eye on same-store sales figures to gauge how well they are doing.
Comparisons between existing locations and new ones help companies understand and learn business trends and shape critical strategies; for instance, making decisions around focusing on existing stores or going into expansion mode and opening new ones.
An increase in same-store figures is a good indication for investors because it helps them evaluate how well the company is doing in retaining its customers. It also helps to boost the stock prices of a company. Whereas, a decline might indicate that customers are losing interest in their products or services or that new stores are cannibalizing business in existing locations. SSS typically affects stock prices; and industry forecasts around the health and future success of a company.
Same-store sales also reveal missed opportunities; problem areas that can be worked upon and the type of process that can be set in place. These figures also help market analysts to find out the effectiveness of retail management and if they are able to convert existing assets into revenue growth.
In today’s competitive world, it is extremely important to proactively know who your customers are, rather than being reactive and responding to customer feedback. There are various in-store retail analytics solutions that will help you track frequent customers and the ones who spend the most. Loyal customers and repeat visits are critical factors in determining your same-store sales.
Analyzing in-store customer behavior using AI-powered footfall counters and empowering your store staff with clienteling solutions can further help you improve the in-store customer experience through personalized engagement strategies. For example, if a frequent customer has fallen off the radar, your store staff can send them a personalized promotion to bring them back by making them feel important and valued.
To increase in-store sales, you can send personalized offers to a targeted audience to increase footfall during a slump. For example, if your business is slow in the second quarter, it might be a good idea to offer a 20% discount during this period to a select set of customers who have previously shown high purchase intent. This could go a long way in increasing customer loyalty and same-store sales.
Customers like to feel appreciated and valued by their favorite brands. Promotional offers and exclusive promotions targeted at them can go a long way in increasing the Average Basket Value, besides increasing the frequency of visits to your stores. The key to successfully executing such personalized experiences is an AI-powered Customer Data Platform that combines and refines online and in-store data to build a Single View of the Customer.
Responding to customer feedback with immediacy is critical to the health of a company; and in terms of customer loyalty and increasing revenues over a period of time. If there is positive feedback, then it means that the business is moving in the right direction. But, if the feedback is negative, it becomes important to address the concerns of customers positively. For instance, if there is continuous negative feedback about your staff, it becomes imperative to have a staff meeting and coach them about handling customers and also have a training program to address the performance gaps.
It makes perfect business sense to review your products and services periodically, to find out how you can improve, provide additional value to customers, and offer solutions that are innovative and creative. It is important to evaluate your offerings and find out what is working and what is not and why. With advanced people counters, you can understand the demographics of your visitors like gender, and age so that you can tailor your products to appeal to a specific segment. High-quality products and exceptional after-sales services will ensure a loyal and repeat customer, thus increasing same-store sales.
Investing in hiring the right staff who will do the actual selling of your products and services will have a major impact on your in-store experience. They should love their job, be glad to be where they are, and know their products, like the back of their hand. Mike Eden, owner of the Ultra Gear Shop says “The staff should be knowledgeable and passionate about their products and should offer exceptional experiences to customers, the same as they have. They should share their passion with confidence.”
Offer your employees training programs from time-to-time, to upgrade their skills and bring them up-to-speed with the latest in retail trends. The staff should be able to identify customer needs, give them what they want, and show them value in their choices. Brands should also invest in clienteling solutions and instant access to customer data via mobile apps for staff to help them track and engage with customers on an ongoing basis.
It is important to keep an eye on the latest trends and understand what your customer wants, what sells and what does not. For instance, cashless checkouts, VR, and BOPIS are some of the recent trends in retail. If your store does not offer customer experiences that are in sync with current trends, there is a chance of your comparable store sales taking a hit.
And more importantly, it’s important to understand what your customers are expecting from your brick-and-mortar stores. Is it the touch-and-feel aspect? Or personalized interaction? Or immediate delivery? Brands will need to understand the role of their brick-and-mortar stores in the overall omnichannel context and focus on enhancing the strengths of this channel. The more up-to-date you are with the latest trends, the better you will be in meeting customer needs, staying ahead of the competition, adding value, and staying relevant.
Most brands make the mistake of relying solely on promotions and discounts to drive same-store sales. But in today’s competitive retail environment, customer satisfaction and engagement play an equally critical role in boosting revenue and fostering loyalty. To truly improve same-store sales and maximize Customer Lifetime Value, brands need to focus on delivering personalized, engaging customer experiences, investing in the right infrastructure, and optimizing operational efficiency.
Ready to take your in-store sales to the next level? Connect with Capillary Technologies today and let us help you create strategies that drive growth and loyalty!
Same Store Sales compare a brand’s revenue for the same stores over different periods, helping measure growth and gauge business performance.
Same Store Sales comparisons provide insights into business trends, guiding strategies for expansion or focusing on existing stores, while also indicating customer retention, stock performance, and areas for improvement.
Capillary facilitates enterprises in focusing on customer satisfaction, personalized experiences, and operational efficiency, key to nurturing brand affinity and same store sales.
December 6, 2024 | 5 Min Read
Over the years, retailers have used Same Store Sales as a ya