Top Retail KPIs to Thrive in the OMNI World (& What to Ditch)
Still evaluating your store’s success based on Average Transaction Value and the usual hard KPIs in retail? I’m afraid that’s as anachronistic as focusing all your social media efforts on MySpace during the age of Instagram and TikTok!
If you want your stores to succeed during the phygital revolution—and of course, you do—you need to change your focus.
This includes prioritising the retail KPIs that take this new normal into consideration.
Let me show you why (and how).
Some hard KPIs in retail belong to physical-only stores—which belong to the past
Retail is evolving. Too many companies aren’t.
Up until a few years ago, physical stores were the ONLY place to interact with a brand’s products. So, it only made sense to focus on audits and hard retail KPIs like:
ATV (Average Transaction Value)
UPT (Units Per Transaction)
Conversion rate limited to that location
Payroll-related KPIs
and so on.
Looking after and driving these KPIs in retail used to be one of the core responsibilities of store managers.
Another popular strategy to measure a store’s performance was relying on mystery shoppers periodically—I’m gonna talk about them later down the article because I need to try and contain my rage first.
But how is this relevant when shops are no longer the only place to buy products?
Simple: it’s not.
Retail has evolved: the new normal is phygital…
Your customers’ shopping habits have changed, but the largest portion of the high street is lagging behind. No wonder it’s been struggling for years!
On the contrary, the stores that are not only surviving but thriving right now are those that have been evolving to match these new habits. Those that embraced the ‘new normal’ in retail, in other words.
And what does this new normal look like?
An omni-channel and phygital approach: services that combine the perks of physical and online shopping to create a smooth and superior customer experience (for example, ship from store, click & collect, return to store, and endless aisle)
Providing an in-store experience that makes it worth it for your customers to come back to your physical location—even when they could choose to buy everything online
To ensure all this, these brands also rely on a new type of store manager: one whose focus is on guaranteeing this in-store experience by coaching their team and leading by example.
Not one who hides in a back office and is obsessed with those old retail KPIs.
… and this calls for new KPIs in retail
Now, don’t get me wrong: I’m NOT saying that the previous ones haven’t got a place in your store anymore. However, if they’re your only or main focus, you’re gonna be left behind.
The phygital age calls for a mixture of (new) hard and soft KPIs in retail.
And by ‘soft KPIs’ I mean those that centre around people’s experience, from customers to… yes, even your staff.
4 top retail KPIs to succeed in the OMNI phygital age
So, what should your store managers focus on?
Here are some overlooked or new retail KPI examples that actually match the current OMNI reality
1. OMNI conversion rate
The old conversion KPI focused on the customers who bought a piece of inventory within that retail store.
Nowadays, with new in-store technology and endless aisle options, they can also browse your app or e-commerce website.
So, they might not leave your store with a physical item in their hands, but they’ve actually ordered something online whilst they were there!
That’s why focusing on old conversion targets is anachronistic. Instead, it makes sense to separate your physical and OMNI conversion KPIs (and this will probably mean lowering the former).
2. Click & collect upsell
Does your click & collect service consists of your staff grabbing the items ordered by a customer and wishing them a good rest of their day? Then you’ve been missing out BIG time!
Click & collect should be seen as an opportunity to:
Upsell relevant items
Make your customers want to return to your store
For example, you could train your front-of-house staff to ask them more about this product and how they’re planning on using it. This gives them the perfect opportunity to make a connection with them and recommend other relevant items.
So, your click & collect KPIs in retail involve the percentage of customers who end up buying something else when coming to pick up some items they had already ordered online.
3. Employee Satisfaction
Yes, the retail industry is plagued by a higher-than-average turnover rate… but, instead of just accepting this, you can actively do something to lower it in your stores!
Too many managers take employee satisfaction for granted or—worse—overlook it altogether. Instead, it should be one of your core KPIs in retail!
Satisfied and happy employees:
translate into happier customers
stay much longer, avoiding disruptions and saving you money
So, to measure, improve, and guarantee employee satisfaction in your stores, you need to actually talk to your staff.