How to Increase Retail Sales as a New or Emerging Brand

New and emerging brands have a lot to contend with when stepping onto the retail scene. Increasing retail sales quickly becomes a top priority for brands, and you’ve got to have the right retail strategies in place to succeed. 

DEFINING RETAIL PERFORMANCE

Retail sales performance refers to how well your business’ product and sales team perform within a given time. Your retail sales performance is based on key performance indicators (KPIs) or metrics. 

RETAIL SALES PERFORMANCE KPIS TO REMEMBER

It’s best to use multiple metrics when evaluating your brand’s sales performance so you can better understand your business’s strengths and weaknesses. You can create a better sales performance plan by looking at multiple metrics.

Some of the most common KPIs retail business owners keep in mind when tracking their sales performance include:

Gross margins return on investment (GMROI): This metric measures how efficiently you use inventory investments. You measure it as the total gross profit divided by the average inventory cost.
Conversion rates: These metrics can help you evaluate how often and how well you turn store visitors into buyers. Measure the number of people visiting the store or website and divide it by the actual number of transactions.
Average transaction value: This is a helpful metric that determines the average amount of money people spend each time they shop at your business or website. It’s measured as the total sales from transactions divided by the total number of transactions.
Sales per square foot: This is a great way to measure how well you utilize your store area and productivity. It’s measured as the total net sales divided by total square footage.
Inventory turnover ratio: With this metric, you can track how quickly you move through your inventory by measuring the total cost of inventory sold divided by your average inventory cost.

WHAT FACTORS AFFECT RETAIL PERFORMANCE?

Several internal and external factors can affect your brand’s retail performance. We’ve outlined three important internal and external factors and what they can mean for your brand.

INTERNAL FACTORS

Here are a few internal factors to help improve retail sales performance at your business:

Online shopping: Product accessibility can make or break sales performance. Online shopping is convenient for customers, especially if they cannot physically shop at your business and can help your business expand its reach and attract new customers. In a world increasingly reliant on technology and the internet, potential customers may view brands that don’t offer online shopping as unfavorable when deciding between your business and a competitor’s.
Marketing strategy: An effective marketing strategy can help you reach new customers and draw more attention to your brand. This is especially important when establishing your brand and distinguishing yourself from competitors. If your marketing efforts aren’t reaching the right audience, your sales aren’t going to see any improvement. 
Costs and pricing: The costs of manufacturing, distributing and selling your product influence the retail price you assign to it. While higher selling prices will help you make that money back, it may not be appealing or affordable to customers, especially if a typically inexpensive product is pricey. There is a delicate balance between production costs and product price points, and it’s vital to determine what prices work best for your business and customers.

EXTERNAL FACTORS

Some external factors to improve retail performance include:

Industry competition: One of the trickiest parts of starting a new brand is going up against existing businesses. Customers are more loyal to brands they’re familiar with and have shopped with for longer, so pulling customers away from established competitors can be challenging when you’re newer to the retail scene. Competing businesses and brands in your industry can make or break your brand’s retail success. 
Social and economic trends: Social trends can direct customer attention to certain products. For example, in the clothing industry, trending styles perform better and drive brand sales. As the owner of a new or emerging brand, it’s important to monitor trends to adjust your sales efforts accordingly and achieve better sales results. 
Customer attitude: Customers have different motivations for purchasing goods and services. You can predict those motivations based on demographics and characteristics like age, occupation, socioeconomic status and similar. By understanding your target audience’s needs, wants and reasons for purchasing, you can better position your business to suit those needs and drive sales.

HOW TO BETTER YOUR RETAIL STRATEGY AND INCREASE SALES PERFORMANCE

These tried and true practices will help you build a retail strategy that will improve your retail sales performance:

SET ATTAINABLE GOALS

Increasing your sales performance is a hefty task, but you can accomplish it by setting smaller, more attainable goals for your brand. You can not improve sales performance in one fell swoop– although that would be nice, wouldn’t it? Setting smaller goals for your brand makes the entire task seem less daunting and lets you measure progress as you go.

FOLLOW THE METRICS

The data doesn’t lie! Use your KPIs to your advantage and start building a retail sales strategy based on the strengths and weaknesses you identify within your sales performance metrics. Continually noting your brand’s strengths ensures you don’t spend time, money and resources toward improving something already performing well. By identifying weaknesses, you can better formulate small goals to work towards.

Your metrics will help you judge what tactics and strategies work for your company and which aren’t producing results. This way, you can better allocate resources to improve your retail sales representation and growth strategies.

CELEBRATE WINS AND BUILD OFF OF THEM

You’ve worked hard to improve your brand’s metrics and increase sales performance, and it’s paying off. Take a moment to celebrate that! Any improvement is a big deal, so remind yourself and your team how hard work pays off by looking at those positive results.

Once you’ve taken a moment to celebrate, analyze those results. How did these numbers come about? Could this success continue when applied to another area? How can you maximize these results?

By asking yourself and your team these questions, you can determine exactly what works about your new sales strategy and continue to make improvements to ensure lasting success. Plus, you might find you can apply some of those tactics to other areas of the business you’re looking to improve.

EMBRACE CHANGE

In today’s market, customer demands and attitudes constantly change. Your retail sales strategy needs to have the end goal of meeting the customers’ needs, so it’s imperative that you’re receptive to customers’ changing demands. It’s a good idea to regularly evaluate your sales strategy and compare it to the current market. Consider if you can make adjustments and embrace the change.

HOW CAN PRESENCE HELP YOU BE SUCCESSFUL IN RETAIL?

At PRESENCE, we believe in going above and beyond for all our clients. We’re all about building relationships with our clients that foster ideas and creativity. Your business goals automatically become our goals, and our passionate and driven team is ready to help your emerging brand experience success. Contact us today to see what PRESENCE can do for your brand!