By Mark Ryski
Jan. 5, 2012
Same-store sales are looking a little flat and you need to find ways to deliver better results. There’s still a scent of the financial meltdown lingering, but you survived that crisis and it’s time to start getting the sales needle to move in a positive direction.
There are only three ways you can drive sales in your stores: (1) encourage more prospects to visit your store; (2) increase your average ticket, and; (3) increase your conversion rate – that is, sell to more of the prospects already visiting your stores. These are the folks who visit your store but don’t buy.
To a great extent, retail sales has been a two-trick pony: drive more prospect traffic and increase average ticket. Driving more prospects into your stores usually requires an advertising or promotional investment of some kind; and increasing average ticket, well let’s just say that most retailers have been and continue to focus on this one – but what about conversion rate? Driving conversion rate is the third trick every retailer needs to learn – it’s another source of sales opportunity that most retailers today completely overlook.
Before I get into the ways you can drive conversion, I need to confirm that you actually track traffic and calculate conversion rate in your stores. First, you need to actually track prospect traffic. This is not the same as transaction counts. Lots of retailers are confused about this. Transaction counts represent the number of people who made a purchase; traffic counts represent the total number of people who came to the store including buyers and non-buyers. Conversion rate is simply calculated by dividing sales transactions by gross traffic counts. For example, if you logged 500 traffic counts in your store and there were 200 sales transactions for the day, your conversion rate would be 40 percent (i.e. 200/500).
The fact is, if you don't track traffic in your stores, you can’t calculate conversion rate. If you can’t calculate conversion rate, well, you can’t improve it. So for the roughly 35 percent of retailers who actually track traffic and conversion rates, here are five ways you can improve conversion rates in your stores: