Actionable Insights From APT's Retail Practice

APT Chairman Co-Authors Harvard Business Review Article

December 12th, 2014 | Posted by JDouglass in General Insights - (Comments Off)

APT Co-Founder and Chairman, Jim Manzi, recently co-authored an article in Harvard Business Review with HBS Professor Stefan Thomke about how experimentation can help retailers de-risk new ideas and drive innovation. The article details a “checklist” for running business experiments and identifies how Big Data can dramatically improve the experimentation process.

Click here to download a full copy of the article.

How can manufacturers maximize the ROI of online ads?

November 24th, 2014 | Posted by Haley Jackson in Manufacturing - (Comments Off)

Over the years, manufacturers have refined their strategies for investing in POS displays, in-store signage, endcaps, and free-standing inserts to attract customers to their products in stores. More recently, manufacturers have increasingly allocated spend to paid search and online advertisements to assert a digital presence for their products. While it is relatively straightforward to measure the online sales impact of these digital advertising investments, it is much more difficult to confidently determine the effect that online investments have on in-store sales. Without an understanding of the complete sales impact across channels, manufacturers cannot be sure of the true ROI of online advertising.

Manufacturers can leverage in-market testing to measure the offline sales impact attributable to online advertising and glean insights to improve the effectiveness of future investments. Results from such tests can answer key questions to help maximize manufacturers’ return on digital marketing investments, such as: (more…)

APT Index Reports October Retail Sales Up 1.3%, or $3.9 Billion

November 11th, 2014 | Posted by MHarper in APT Index - (Comments Off)

Retail same-store sales increased 1.3% in October 2014 compared to October 2013, according to data from the APT Index. Click here to view the top and bottom performing cities.

Which Initiatives Should Executives Test?

November 10th, 2014 | Posted by Katheryn McKee in General Insights | Retail - (Comments Off)

In his recently published article in Information Age, APT VP Rupert Naylor explains the importance of leveraging customer and transaction-level data to run in-market tests to inform important business decisions, ranging from new production introductions to marketing and remodels.

“Organisations that are able to use testing in physical locations to drive growth and profitability will hold a distinct competitive advantage. We have seen industry leaders minimise the risk of innovation and maximise incremental margin by making testing each new initiative faster and cheaper prior to broad rollout. These in-market tests allow executives to predict which programmes will work, where they will work best, and how they can be tailored for maximum impact,” Naylor says.

Click here to read the full article.

In a recent InformationWeek article, APT SVP Jonathan Marek recommends that CIOs create “innovation funnels,” a process for continually collecting ideas, testing them, and implementing the ones that are found to be effective, within their organizations.

Marek writes, “The key to a successful innovation funnel? Don’t limit the testing process to just a few big-bang ideas, or those from executives, or those that sound like winners. Ideas for testing should come from across the business and be developed from a broad range of sources, including talking to customers and store managers in the field, monitoring what competitors are doing, and looking at other industries that target your customers.”

Click here to read the full article.

APT Index Reports September Retail Sales Up 0.4%, or $1.1 Billion

October 14th, 2014 | Posted by MHarper in APT Index - (Comments Off)

Retail same-store sales increased 0.4% in September 2014 compared to September 2013, according to data from the APT Index. Areas that performed better included those where median income was less than $50K and those where median age was less than 35. Click here to view the top and bottom performing cities.

With the announcement last month of its Corner Store experiment in Washington D.C., Uber joins a list of prominent companies, including Google and Amazon, that are experimenting with grocery delivery services.

Beyond whether these services are profitable for the delivery companies (i.e. Uber, Google, and Amazon), the proliferation of grocery delivery services raises a number of questions for grocery retailers, including:

  1. Should grocers that don’t currently offer delivery service begin to introduce it? How does delivery’s effectiveness compare to other similar services, such as “Click and Collect”?  Should they do both?
  2. Will impulse purchases and cross-sell decrease as a result of these programs (e.g. merchandise at checkout counters, end caps, etc.)? If so, will transaction frequency increase enough (from both new and existing customers) to offset a potential decrease in basket size? How does this vary by location?
  3. Should grocers build their own delivery service or partner with services like Uber that already have the necessary infrastructure in place? Or both?

These questions are not necessarily new ones—this blog has discussed similar topics before, such as “click and collect” (read more here). However, considering the fact that Google, Amazon, and Uber have all introduced similar programs, these services may gain more traction in the coming years.

As with all new product or service introductions, anticipating the profit impact of delivery for grocers is challenging without first trying it.  Testing the service in a few markets will allow executives to gauge whether these initiatives are profitable, and help inform the optimal rollout strategy.

Retail same-store sales increased 0.3% in August 2014 compared to August 2013, or $1 billion, according to data from the APT Index. The APT Index also showed the states with highest sales performance during Tax Free Weekends. These states included Massachusetts (+63%), Tennessee (+43%), and New Mexico (+34%). Click here to view the top and bottom performing cities in August.

Is It Time To Take Your Space Planning Beyond Average?

September 2nd, 2014 | Posted by CCorman in Space Planning - (Comments Off)

When Isaac Newton famously created his third law – “for every action, there is an equal and opposite reaction” – he may not have known he was also talking about allocating space within a store. Space planning involves a series of trade-offs whereby when one category receives additional space, another category loses space. Newton was only partially right, though. Yes, when one foot is given to Category A, Category B must lose one foot of space. However, the sales impact is not usually equal and opposite. Every category generates different sales per unit of space. Even more importantly, every category generates different marginal sales, that is, the amount of sales it generates for each additional foot of space it receives. (more…)

How Manufacturers Are Making Faster, More Automated Decisions

August 25th, 2014 | Posted by MHarper in Uncategorized - (Comments Off)

APT SVP Aaron Fidler discusses APT’s software suite for manufacturers.