In an age when consumers research their purchases thoroughly online, talk to their friends for recommendations, and test out their potential purchases in store, exactly what role do store staff have to play beyond facilitating the experience? Recent research by GfK shows that the suitable mix of in-store recommendations and demonstrations, achieved by store staff training, can be highly effective at increasing sales.
A new GfK research programme has provided some unique insights into the ROI of store initiatives by combining mystery shopping results with individual store-level sales data. The programme reveals how the in-store experience translates into sales and shows the average uplift in sales resulting from different types of in-store activity. This is highly useful for brands that want to understand how to prioritise in-store marketing budgets, benchmark against competitors, negotiate better rates for display space, and calculate the ROI on in-store marketing spend.
So what are some of the key findings of this programme that are useful for marketers?
Recommendation drives market share, but not all recommendations are equal
As expected, there is a significant correlation between in-store recommendation and share. However, this is not consistent for all brands; brands with a relatively high price point are more resistant to recommendation turning into sales and brands with a very high appeal will achieve a high share with low recommendation.
The programme reveals that it is not enough simply to be recommended; what is said is just as important. Consumers are more likely to buy in store if they are given a number of reasons to buy. On average, advisors gave 14 reasons for recommending a handset, with the most frequent reason being that the phone had good Internet access. However, when advisors recommended the brand itself, the greatest uplift in sales was achieved.
Additionally, knowledgeable and enthusiastic advisors sell more. The Holy Grail for a brand is to turn advisors into brand advocates, and to get them to actually use and love their handsets. For customers it is very powerful to hear an advisor say “this is a great phone, I have one of these”. Such findings are crucial to helping brands calculate the impact of getting their devices into the hands and hearts of store advisors. As well as giving out phones, brands can work with stores to customise phones for advisors, and include free apps that will convince them to actually use the handsets.
Don’t bother to demonstrate the camera
Even the most enthusiastic brand advocates can sell more if they are trained to demonstrate the features that customers most want to see and use. Demonstrations can increase sales by 6.8 per cent on average, although showing only the camera gains a feeble 3.9 per cent increase., consumers typically now know how a camera works. Where advisors demonstrated how to use social networking sites, this led to a sales uplift of 8.3 per cent. Stores can use these sorts of findings to develop advisor training programmes to focus on the features of most interest to customers, thereby driving up sales.
Pay and display
The area where most of the in-store marketing budget goes is in visual presence. Any sort of visual presence at point of sales results in an uplift in sales. The biggest uplift of 10.9 per cent comes from having a dedicated in-store display area. However, it is interesting to note that an uplift of 8.2 per cent can be gained from having a freestanding display unit which may well be cheaper to implement than a dedicated area.
Pile ‘em high?
The research splits stores by high, medium and low sales volume outlets . Whilst there are fewer high sales stores (they are likely to be flagship stores) the research perhaps surprisingly finds that advisors in these stores are not always the most knowledgeable or enthusiastic. This may be because they host a wider product range resulting in diluted advisor knowledge. Nevertheless, these stores do sell more, partly because they are in high footfall areas, but also because they create an exciting environment for brands.
Conclusion
This programme clearly shows that recommendation is important and that there are opportunities to maximise return on investment in store, turning advocacy into market share. This data is hugely useful to support brands in making informed choices about how to spend in-store budgets that would not otherwise be possible. The study is currently conducted in the UK but we believe it has direct relevance for other markets. Future research programmes will be exploring other geographies.
Sources
GfK study tracker piloted in 2011 and involved conducting mystery shopping at 150 stores, for the top five handsets and comparing with sales data from the same 150 stores.
