The holiday shopping season has come and gone. Ideally, every company should be looking back on that time of year and see more sales, more customers, and higher profits. While it is the most fruitful time of the year for sales and customer engagement, calculating sales and analyzing the results after a busy season is sometimes very challenging.
How to Review and Evaluate Sales from this Holiday Shopping Season
In today’s business world, the retail landscape and the tools to analyze and evaluate sales have changed. Historically, sales were evaluated by sales per square foot and store income statements. However, as online shopping increases its share of total sales, evaluation methodologies need to evolve too.
Reviewing and evaluating holiday season sales can be particularly beneficial for companies seeking to establish better strategies and practices for subsequent years. Nevertheless, the retail industry is changing so quickly that there is still no comprehensive list of key performance indicators (KPIs) to evaluate retail sales.
Retail businesses should use the following metrics as a start for evaluating success in the evolving retail industry, especially in the wake of the holiday sales season:
Define and measure a catchment area. Online stores sell a high proportion of products to customers in a small-to-medium radius around the physical store. These sales are often not included as store revenue, even though they are driven by the store. Different classes of products and stores will have different catchment areas, but they should not go unrepresented in sales calculations. Implementing a strong omnichannel strategy should help provide better insights into these areas.
- Stores should calculate products that are bought online and picked up or returned to the physical store. If stores do not make this calculation, they are missing key profits and losses that cannot otherwise be tracked.
The conversion rate calculates the amount of physical or online store visitors that make a purchase. A high conversion rate points to good customer service and competitive prices, while a low conversion rate shows that the business can improve in certain areas.- Analysts within your organization might be interested in data on sales per square foot or sales per employee to evaluate if some aspects of the store experience can be improved.
- Sales by product category show retail businesses what categories are the most popular and what categories aren’t working as well for the business.
- Online vs. brick and mortar sales reports indicate what percentage of sales are made on online platforms compared to in the physical store.
These metrics will help retail businesses evaluate sales more accurately. Preparing for the holiday shopping season is important for maximizing profits and gaining an edge against competitors.
With a sales evaluation plan and access to DMM’s valuable databases and statistics, you can discover vital insights to guide your sales strategy for the next holiday shopping season.
