Like many retailer planners and operators, the August heat doesn’t make me think about cool drinks on sandy beaches. Instead, it brings to mind thoughts of snow, chestnuts roasting on an open fire and yes, retail centers filled with shoppers (who are carrying filled bags of merchandise)! It is around this time of year that retailers are finalizing their plans for the holiday season. As you prepare, keep in mind the following points for making your season a strong one.
Start With The End
A retail best practice is to keep notes on what happened at the end of a season — what worked, what didn’t and why, so you can apply those insights to the next year. Take your post mortem on issues like promotions, staffing, scheduling and traffic and compare how inputs such as promotions influenced customer traffic. Then, observe how your staffing and scheduling decisions resulted in sales performance. The two primary questions you want to answer are:
- Did my promotional activity drive customer traffic?
- Once they arrived at my stores, did my customers receive the intended experience, resulting in a purchase?
Store traffic behavior during the period between Thanksgiving Week and New Year’s is highly predictable. Black Friday is always the biggest shopper traffic day of the year, and each Saturday in December is progressively larger as you approach Christmas Day. ShopperTrak posts the Top 10 shopping days each year, and what has been observed is that these 10 dates account for 38%-40% of all shopper traffic for the holiday season.
What that means is that if you don’t schedule your associates and stock your stores accordingly, you are risking your entire season. If you count traffic, take a look at your own historic Top 10 dates to see how you should instruct your stores. Why the focus on traffic instead of sales? Sales are a result, while traffic is your opportunity to engage a customer and end up with a better result.
Get Shifty With The Calendar
Every year, there are prognostications on how the number of days between Black Friday and Christmas Day, or the intensity of Cyber Monday or the expanded November promotional offerings will impact shopper behavior. It’s actually simpler than that. The question is, how many Saturdays are there before Christmas Day, and that is based upon the shift of Thanksgiving Day and the standard calendar movement for the exact day of the week where Christmas Day falls. The past two years, there have been four Saturdays leading into the holiday. And just as it did last year, there will be a fifth Saturday before the new year arrives. These shifts of the calendar will increase the importance of Saturday and this includes Dec. 29, 2018, which should also be one of the biggest traffic days of the season.
Continue Hiring (You Should Have Already Started)
With an unemployment rate hovering below four percent, it’s getting harder to attract potential employees. That’s one of the reasons that some retailers began their seasonal hiring program in July. This will make it even more important to hire (and keep) employees as soon as possible, so that they can be onboarded, trained and productive long before the first snowflake falls.
For some retailers, hiring began with the back-to-school season. For those organizations, it would yield even better performance to keep those temporary associates on through the end of the year. We looked at the cost of obtaining a seasonal employee compared to the potential cost of keeping them on. What we found was that the difference between keeping a trained associate vs. letting them go and trying to rehire them (or hiring someone else) was favorable to keeping them on. Additionally, since they were still on the team, they had the ability to drive further revenues; a win for everyone.
Forecasting For Service
One last note on preparation. Typically, someone within the retailer’s organization projects anticipated sales for each store and for the brand as a whole. That number becomes the one that any other projection is based upon, such as traffic expectations and labor hours. Too often retailers inaccurately forecast traffic by backing into traffic assumptions based upon transaction counts. The result? Gaps in service when scheduling associates.
A more accurate way of determining staffing needs is to start with a forecast of traffic and to integrate the upcoming calendar shift patterns addressed above into traffic assumptions. Getting your staffing right and scheduling associates for the right days at the right times will go a long way towards providing your customers with your intended experience, and keep them coming back well beyond the holidays.
Brian Field is the Senior Director of Retail Consulting Practice for ShopperTrak, where he oversees the application of ShopperTrak’s proprietary solutions to retailer-specific issues across different functional areas in order to drive top and bottom line store performance. Prior to joining ShopperTrak, Field served in roles of increasing responsibility at Chico’s FAS Inc., including as the director of corporate store operations and finance. He has spent nearly four decades in the industry, and his experience includes: store sales and management, training, merchandising, strategic planning and analysis for brands as diverse as David’s Bridal, Circuit City and Macy’s.