It’s the Data and Calendar, Not Your Gut This Holiday
By Shelley E. Kohan, email@example.com
In reviewing month-to-month sales results, the saw tooth performance of 2012 has left many retailers wondering the fate of holiday this year. Early predictions for holiday comp sales results have hinted to low single digits.
But let’s face it. We hear the same predictions each year; they are a safe bet for analysts during a challenging global retail climate. And, planning based on month-to-month performance can be dizzying. So, on the eve of the 2012 Holiday season, let’s get our minds focused on near-term performance, and rely on more than instincts and isolated data points from 2011 to plan the next two months out.
Nearly 95% of sales in 2011 occurred in stores, according to the U.S. Department of Commerce. Many retailers face the challenge of staffing to demand during holiday season to minimizing staffing costs during an unpredictable environment. Additionally, some retailers use transactional or sales data, which are lagging factors, to plan staffing.
Critically important in today’s retail environment is understanding the missed opportunities of the 2011 holiday season, so we can focus on wins for this season. By looking at RetailNext’s 2011 Holiday Performance Report and taking into close account the shift of key shopping dates on this year’s calendar, we can see how “Big Data” findings translate into actionable insights to help drive sales and profits in the next two months.
This holiday, the calendar and smart staffing are the keys to seizing sales. These insights should help you plan:
- Start hiring and training now: Across the board, retailers are missing early season traffic by not having enough staff the first two weekends in November. Many extend their existing staff first before hiring new associates or don’t have new hires trained in time to hit the selling floor before mid November. Some degree of newly hired, trained sales associates need to be on the floor by the first Saturday of November. Hire in shifts or increments, to accommodate the high weekend traffic in early November. Look at the by-hour and by-day traffic to conversion comparison from the past few months or last year, if you can. You’ll have chances to shift staffing to where you need it most.
- The two-day gift: This year, there are 32 versus 30 days shopping days between Thanksgiving and Christmas. Looking at the calendar, the extra days fall on a weekend. The Saturday before Christmas in 2011 was Christmas Eve, which from a sales perspective was not impressive (15% sales drop versus previous year). This year, the weekend before Christmas has tremendous potential and will mean high traffic demand. This is the TOP opportunity for 2012 so go all out and staff the weekend optimally.
- Hanukkah comes early: The dates for Hanukkah are Dec. 8 – Dec. 16 this year, versus Dec. 20 – Dec. 28 last year. Understand the markets where this will have an impact on the business and plan ahead.
- Watchful Wednesday: The day after Christmas should be treated like Black Friday. Most retailers experience similar high traffic on the 26th. Last year, Dec. 26 was on a Monday and a work holiday for most customers. This translated into a major sales uptick from 2010 (traffic was up 27% and sales up 24% for RetailNext clients). It needs to be protected from a potentially disappointing sales drop so have a detailed plan ready for deployment.
- “After” traffic is good traffic: The post-Christmas sale is an opportunity for most retailers. Traffic continues to hit stores only to find the Holiday help, beyond the Service Desk, gone! Sure, there is a conversion drop resulting from returns, however, the customer mindset is still in “shopping mode.” So, ensure you have the staff to help drive that buying indecision forward. After all, wallets will be full of very trendy gift cards that need be converted into a sale.
- The “eves” could be huge: Last year, Dec. 24 fell on a Saturday with traffic and sales dropping 15% for stores within the RetailNext network. This year, Christmas Eve falls on a Monday, signaling a great opportunity to maximize conversion and sales. Additionally, Dec. 31 falls on a Monday this year, so many people will have the day off or leave early. Shoppers are still out in the stores and want to shop – and women’s’ wear could see particularly high conversion. Give them incentive to buy!
Having access to big data insights and an understanding of how to interpret data – from traffic patterns to shopper behavior to POS reports – will prepare you to staff to demand during the holiday season. Add a closer look at the calendar with proper planning this holiday leads to optimized staffing and maximization of sales.
Remember, start early and nail that first opportunity which is Nov. 3 and Nov. 4. Let’s throw off those analysts touting a “low single-digit increase” and drive a double-digit increase.
Shelley E. Kohan is VP of retail consulting at RetailNext and has more than 20 years of experience in the retail industry, focused on luxury brands within the department and specialty store sector. She is an expert in applied big data and retail store operations to drive sales, increase profits and improve “store choreography.” She is also an instructor at the Fashion Institute of Technology of the State University of New York, in the Fashion Merchandising Management Program. She can be reached at firstname.lastname@example.org.