(Apologies to readers of this feed who also read Inside Retailing Blog for cross posting.)
The accompanying graphic is based on a blend of scientific, anecdotal and personal experience, but is not meant to be definitively accurate. (Rather, I am trying to illustrate the principle.)
- The traditional view (and I have long since lost the original source) is that the front 33% of the store generates 55% of sales.
- Based on the research conducted by Envirosell, Paco Underhill is a strong proponent of the ‘landing strip’ – which is the space immediately on the inside of entrance where the customer ‘lands’ and changes from being passerby, to browser.
- In practice, you simply have to walk through any shopping precinct, say your local mall, and you will see how many retailers crowd their lease line and ‘trade out’. When you speak to them, you find there is no science behind that practices, but rather simply an innate sense that they ‘sell more when they put it out front’.
It is obvious that there would be instances where this would not apply; e.g. say in a fashion boutique that relies on a minimalist presentation style and is a high-end exclusive brand. And it goes without saying that the smaller the store, the less applicable these insights may become.
The yellow and orange zones in this diagram would represent a disproportionate amount of sales, and let’s say for argument’s sake it constitutes 50%.
The practical applications of these insights are:
- You should locate your highest-margin (primary) stock in the zone
- You should rotate your stock in that zone regularly to maintain a fresh proposition
- You should balance your customer’s need to ‘land’ with the desire to stack more stock
- Trading out simply pushes the zone forward – it does not change the shape or the size of the zone.
- Do not locate non-trading facilities in these areas (e.g. cash desks which are not sales generating areas).
- There are (probably) natural focal points in the zone and these should be optimised to tell the right stories.
Would you like to add any insights?