Understanding what matters most at retail

SARASOTA, FLA. —There is a delicate balance that exists in retail where store-level operators have to keep customers happy while executing new directives from headquarters, and they must do so within the constraints of a labor budget that never seems to contain enough hours.

With the unyielding pressure on store-level labor budgets, it has become more important than ever for retailers to ensure every dollar spent on wages is being applied to those activities that have the greatest impact on the customer experience, and that new initiatives intended to impact that experience and drive sales are being executed properly.

Executives at National In-Store, a provider of third-party in-store services, have witnessed this scenario firsthand, which explains why they created a new division called Retail-Metrics and hired former RadioShack executive Steve Greenstein to serve as vp.

“What we are trying to do is improve the in-store execution of all those activities that support the retailers’ brand promise, and one of the biggest challenges in retail is consistently delivering on an in-store experience that supports it,” Greenstein said.

Through RetailMetrics, retailers who out-source services such as store resets, for example, are able to gain insight into the quality and consistency of work being performed across the entire chain. Third-party service providers have long offered such audit services but Greenstein contends the RetailMetrics’ approach is different.

“What’s been around a long time is more of a mystery shop where you are just skimming the surface. What we are getting at is the core operating behaviors and activities that retailers have identified as critical to delivering a great customer experience and increasing same-store sale growth,” Greenstein said. “We help identify, in an unbiased fashion, the level of execution, and help retailers identify those operating behaviors and actions that are really making a difference.”

A retailer could rely on its network of store and district managers to provide such information, but the challenge with that approach, especially for a national retailer, is the lack of consistency and objectivity in how activities are measured. And since any strategy is only as good as the degree to which it is executed, having an objective means of measurement in place is crucial to understanding the performance of new initiatives.

“By having a measurement program in place, a retailer can help eliminate false negatives,” Greenstein said. “There is nothing more frustrating for a retailer than to introduce something and have it not succeed…because it wasn’t properly executed.”