Actionable Insights From APT's Retail Practice

A recent Wall Street Journal article, “How Store Know What You Want When You Shop,” discusses how leading apparel retailers are using Test & Learn to analyze their data to inform key decisions about discounts, product placement and styles, and much more.

As author Christina Binkley writes, “APT is a specialist in cause-and-effect analytics, which is at the forefront of the revolution that so-called big data is bringing to industries like retail, which have been run more by gut feel than science…It may evaluate where products are displayed, a discount amount, or the colors popular in Atlanta versus Chicago. This is helping the apparel industry fine-tune its pitches to consumers.”

Read the full article here. (WSJ login required.)

With grocers now facing an onslaught of new competitors, growing share-of-wallet can be challenging. So how are leading grocers remaining competitive in this evolving landscape?

In a recent Progressive Grocer article, APT VP Jeff Campbell discusses the following five strategies that grocers are experimenting with to encourage customers to frequent their stores to spend their grocery budget:

  1. Targeted promotions
  2. Expanding gourmet and specialty assortments
  3. Adding pharmacies and gas stations to stores
  4. Offering bounce-back promotions
  5. Enhancing the in-store shopping experience

Campbell writes, “With so many opportunities to bolster customer loyalty and drive store traffic, it can be difficult to decide which of these strategies is right for your business. Some will work well, and some will be added expenses with no added benefit. To accurately evaluate each new strategy, grocers should rapidly and rigorously test them in market. This approach—known as Test & Learn—not only helps companies make better decisions today, but also affords them the ability to try bolder ideas that can lead to additional market share and profits in the future.”

Read the full article here.

An article titled “Beyond The Cone of Uncertainty: How to Develop a More Profitable Promotional Strategy,” by APT SVP Jonathan Marek, is featured in Digital Marketing Magazine. He writes, “while promotions have long been a central part of marketing strategy, the increasing availability of customer data and the proliferation of digital-enabled contact channels are revolutionizing marketers’ ability to efficiently send personalized offers and deliver them in innovative ways.” Click here to read the full article.

APT Index: March Same-Store Retail Sales Increase [+1.8%]

April 13th, 2015 | Posted by MHarper in Apparel | APT Index | Retail - (Comments Off)

APT today announced that the APT Index of in-store retail sales for March 2015 increased [+1.8%] compared with March of last year, as Americans’ view of the economy reached an 8-year high. APT Index general merchandise sales increased [+1.8%], and APT Index apparel sales increased [+0.4%]. Click here to read the full report.

What Role Should Testing Play in Change Management?

April 2nd, 2015 | Posted by Katheryn McKee in Retail - (Comments Off)

In a recently published article in Retail TouchPoints, APT SVP Jonathan Marek explains the importance of testing ideas on a smaller scale and focusing on their incremental impact to more accurately determine which innovative ideas work well, which need to be refined, and which should be abandoned.

Marek comments, “Retailers should be measuring change in sales, profit, customer satisfaction, inventory levels, and more, in the short-term, as well as changes in long-term metrics that gauge the customer relationship benefits that manifest as a result of the program. For each of these metrics, retailers must be laser-focused on uncovering the incremental impact, or what would have happened in lieu of launching the initiative, while accounting for external factors, such as socioeconomic conditions and competitor actions, that can skew program assessments.”

Read the full article here.

APT today announced that the APT Index of in-store retail sales for February 2015 decreased [-0.9%] compared with February of last year. The decrease was driven by a decrease in the number of transactions [-1.8%], as poor weather deterred shoppers. The APT Index of General Merchandise sales decreased [-2.1%] and the APT Index of Apparel sales was down [-0.6%]. Click here to read the full report.

8 Tips for Improving Your Testing Process

February 13th, 2015 | Posted by Haley Jackson in Apparel | Grocery/Convenience | Retail - (Comments Off)

Most retailers use in-market tests to help inform decisions. But just running tests isn’t enough. Based on our work with dozens of retail brands, here are eight tips for improving your testing process.

  1. Grow your innovation funnel. You should never be left with just one idea to try – if it doesn’t work, what’s left? Ideas for testing should span marketing, merchandising, operations, pricing, and capital investments. Many retailers generate these ideas from a broad range of sources, including talking to customers and managers in the field, competitor actions, and importantly, analyzing their own transaction and customer data more deeply. Often ideas are filtered through taste panels, focus groups, surveys, and the like, which can help weed out a fraction of the ideas that may not work. Ultimately, however, all of the resulting ideas are unproven until they are tested in the real world. For example, new promotions could give away money to customers who would have paid full price for the promoted item, targeting Millennials could alienate other customer segments, etc. It’s easy to make any idea sound good and support it with customer feedback, management anecdotes, executive intuition, or survey data, but the reality is that many innovative ideas don’t work. Organizations need to have enough ideas in the funnel so that they can throw away the ones that don’t work and refine and target the ones that do.


CPGs leverage digital channels to connect with customers

February 11th, 2015 | Posted by Haley Jackson in Manufacturing - (Comments Off)

While the majority of consumer packaged goods sales are still derived from brick and mortar retail, the evolution of new distribution channels has increased the feasibility of manufacturers distributing and marketing products directly. As previously discussed, CPGs are leveraging these to explore new strategies (e.g., loyalty initiatives, direct shipping services) to more closely interact with consumers. Bolstering online and mobile capabilities can increase access to customer data and enable manufacturers to keep up with consumer trends, such as the growing shift towards shopping in digital channels. Traditionally, digital platforms have primarily served to educate consumers about products, but by enabling online or mobile purchases, manufacturers can collect shopping behavior data directly to learn more about their customers’ preferences. Other potential upsides to leveraging a digital DTC channel include strengthened brand loyalty and engagement and more control over product assortment and pricing. (more…)

APT Space Planning Optimizer

February 6th, 2015 | Posted by Katheryn McKee in Space Planning - (Comments Off)

Determining the optimal space allocation for departments and categories across stores is a central responsibility for space planners seeking to achieve space performance goals. This video shows how innovative retailers are moving beyond the traditional approaches of large spreadsheets, complex queries, and “gut instinct” to solve this challenge with APT’s Space Planning Optimizer, which generates localized space recommendations.

The Data Culture Balancing Act

February 5th, 2015 | Posted by Joel Read in General Insights - (Comments Off)

McKinsey & Company recently posted an excellent article, “Getting big impact from big data,” and addressed a proverbial elephant in the room: while most executives believe big data analytics is a critical tool for success, fewer companies have been able to successfully use analytics to drive major business decisions.

So what is preventing organizations from unlocking the value of their data? According to McKinsey a major barrier has been internal organizational cultures that are not familiar with analytical practices and therefore unwilling to take ownership of a new system with unproven results. This keeps organizations from being able to operate data driven initiatives at scale. So while software solutions can help, there is also a significant cultural challenge that needs to be overcome for organizations to realize the full value of big data. (more…)