As every major retailer knows, there are significant performance variations between locations. What few are able to explain, however, is exactly what factors explain the differences between low and high performing stores, and what levers they should be able to pull to increase store performance.
If you want to boost sales and delight customers, start by focusing on the basics. The following fitting room key performance indicators (KPIs) will shed light on those performance levers.
Functional Fitting Rooms = A Healthy Bottom Line
Most retailers count the number of people who walk in through the door every day. That’s useful information to have, but it’s not very telling on its own.
Let’s say you ran a marketing campaign and the store was literally thronged with people. You’d expect that with a ton of people in the store at all hours of the day, there would be a corresponding increase in sales.
Would it surprise you to learn that, based on our customer research, sometimes the highest volume stores have the lowest sales figures?
To identify the difference between apparel stores that perform well and those that don’t, you’ll need more than just door count.
One leading indicator of apparel store health is fitting room usage. The fitting room is a key conversion area between the front door and the cashwrap. It’s also an area where the store operations teams have control. Store operations can’t change the size or color options of the new spring line, but they can provide an excellent fitting room experience.
And based on our clients’ experience, if you improve these fitting room metrics you WILL improve your sales.
Fitting Room KPIs
To boost store performance, the KPIs you need to carefully examine are:
- The total number of visits to the fitting room
- The average time each customer spends in the fitting room
- The number of calls for assistance from the fitting room
- The average response time after a call for help in the fitting room
You’ll note these indicators have nothing to do with sales, discounts, promotions or staffing levels. Here’s why.
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Total Number of Fitting Room Visits
If your associates are greeting shoppers and nudging them in the direction of the fitting room from the time they set foot on the sales floor, the total number of visits to the fitting room will increase.
Average Time in the Fitting Room
Once in the fitting room, if shoppers are engaged by a sales associate who is assisting them and making helpful suggestions for upsells and cross-sells, they’ll spending longer in the fitting room. There’s also an increased chance they’ll make a purchase, and a larger purchase than they originally intended.
Number of Calls for Assistance
When a customer calls for assistance from the fitting room – versus an associate knocking on the door – they are operating on their own timeline. The ability to easily ask for assistance also helps avoid the dreaded re-dress, which is the first stop on the way out the door.
Customers who have to wait too long for help are bound to be unhappy. When you understand how long it’s taking your associates to respond, you gain insight into staffing needs and performance management issues.
The Difference Between Leading and Lagging Indicators
You may have noticed that none of the KPIs above have anything to do with cashwrap. That’s because store sales are actually a lagging indicator of overall store performance, whereas overall store traffic and fitting room traffic are leading indicators.
It’s important to understand the difference between “leading” and “lagging” indicators when evaluating performance.
A leading indicator is a visible trend that comes before a change. In a retail setting, a customer trying something on is a leading indicator of a sale, because they are now nearly seven times more likely to make a purchase. An increase in overall fitting room usage can be an indicator of a pending increase in sales.
Lagging indicators provide insight into trends that have already happened. Again, in the retail context, this could be the corresponding pattern between long waits at the cashwrap and the number of people who leave empty-handed.
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Leading and lagging indicators aren’t always closely correlated, and it’s critical to keep an eye on both to maintain optimal staffing levels and implement new sales strategies.
Summing it Up
Fitting room performance is a crucial indicator for apparel retail store performance. There are four key fitting room metrics. When you focus on improving these metrics, you’ll boost store performance.
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