This is part 2 of a 3 part series. In part one, we touched on the cornerstone of retail design: branding. It was important to start there because good retail design always, always starts with a solid understanding of the brand you're designing for. The store designer's job is to interpret that intangible essence into the world of experience to compel your customers to fall in love with you. They can't fall in love with you if they don't have a sense of who you are at your core. In that sense, the designer of the space gets to play the role of cunning match maker. Kind of a dramatic perspective on the whole thing, but apt. And in part three, we get into the value of design integrity in real world rollout, where the rubber meets the road and you don't want to find yourself driving an Audi with an Oldsmobile engine and $99 paint job.
So branding was the logical place to start, at the crux of the matter, but with an interesting frustration point. Measuring the real world ROI of dialing in one's brand (the store's persona) is hard to do, at least quantitatively.
Today we're moving on to the much more literal (and measurable) stage in the process: store planning and design. For the sake of brevity I'll describe this as the part where you choreograph your shoppers' experience, from the route they will take through your space, to how long that route will take them, to what they will face (see, hear, smell, and feel) during their journey.
Most stores see a 7 percent to 10 percent sustained increase in sales the first year of an upgrade. Personally, we have seen remodels result in 40% initial sales increases, settling in for the long haul at 20%. One standout case saw a particular category (produce) sky-rocket with 70% sales increases. How does store planning and design directly link to these increases?
At the basest level, it boils down to the fact that the longer a shopper happily stays in a store, the more likely they are to spend. The more they enjoy their time in your space (the colors and materials they're surrounded by, the ease of following the path the space lays out for them, the satisfaction of finding what they're looking for, the delight of discovering new complementary items to purchase, the emotional quality of the lighting, etc.) the more all these things work together to bring joy to your shopper, the more they're getting what they want out of the experience.
All of this should add up to a few more moments spent in your store, a few more items in their cart, and more frequent return trips. Those are ROI numbers you can measure easily. Customers leaving a store feeling satisfied will also share their positive feedback organically, creating buzz about the experience and leading to more foot traffic from new shoppers who will in turn spend longer, buy more, return more frequently, and spread their own buzz. It's a positive feedback loop of return on your investment. Which is technically even more return on investment.
In addition to pure sales lift, the real ROI, core measurables you probably want to be tracking should answer these questions:
- How many unique shoppers are visiting the store?
- What is the average transaction count?
- What is the average basket size?
- What is the average visit duration?
- What is the average return frequency?
There is no such thing as lean store planning. You get out of it what you put into it, so be smart. Your thoughtful, intentional store plan will determine what you're going to sell, how much you're going to sell, and how you're going to relate the different categories you're selling to each other. Let your offering be market driven (those really looking to create a differential that will get a shopper's attention, keep their attention, and earn their business should look no further than the shoppers themselves). What I'm saying is find a way to research what your customers are looking for, what they're going to respond to in a good way, and what they're going to respond to in a bad way. Let that be your guide.
Every bit of design counts. Your store design starts from the outside and works its way in. That begins with the exterior. Customers' impressions of your store, what they think about it and expect from it, begin before they ever step foot inside. And then once a shopper is inside your space, make sure it's staged to your best advantage. Because even if it's the most fantastic, well-designed, well laid out store in the world, if they're unable to see it the way it should be seen due to shoddy or interruptive lighting, you've got a real problem.
By masterfully crafting a space that works as much for your shopper as it does for you, you are investing in a synergetic relationship with your customer that will increase your sales for years (providing you hold up your end of the bargain by maintaining the valued experience your customer trusts you to provide).
You can't measure retail design, no matter how well thought out, until it's executed. Crummy execution can undo the value of even the best planned layout and store design. Next week, the final post in this series will focus on design integrity in roll-out.
- Andrew's Chicago Restaurant Picks for IRDC
- ROI of Store Design - Branding
- ROI of Store Design - Integrity in Rollout
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