How to turn a sales setback into market success. How can we successfully replicate an unexpected positive sales outcome?
When planning a sales initiative, such as the launch of a new product or service, or the opening or refurbishment of a retail outlet, a company cannot simply consider its own resources or the competitive landscape. Above all, it must focus on the specific circumstances in which the customer may find themselves.
The challenge
A major player in the large-scale retail sector experienced a significant sales slump at two of its recently opened outlets in the same region.
Certain common factors had been observed at both outlets:
- great success in the first two weeks after opening, with high footfall and average receipt values;
- a sharp drop in visitor numbers and the value of receipts issued.
- opening hours and store size were essentially consistent;
- both had ample car park facilities;
- the socio-demographic profile of the catchment area was also fairly similar.
There were also factors specific to each outlet:
- Retail outlet A was situated at the entrance to a medium-sized town at the junction of a busy provincial road, but it was in an environment with intense competitive pressure as five other retail outlets (three supermarket chains and two discount stores) were located just a few hundred metres away.
- Point of Sale B was situated in an urbanised area on a busy thoroughfare, which favoured it for traffic heading towards the town centre, but not for traffic leaving the town.
The client also reported a high level of customer satisfaction at both retail outlets, as measured among customers enrolled in the loyalty scheme.
The solution
Eumetra’s study centred on the streets and main roads within an 8–10-minute drive of the two retail outlets, focusing on collecting and categorising the reasons for ‘non-use’ and profiling the catchment area population.
This approach aimed to identify three levels of information.
1. Segmentation of the population (size and profile) within the catchment area into
- regular users (“I visit the point of sale fairly regularly”)
- irregular users (“I visit the PDV occasionally”)
- abandoners (“I used to go there but I don’t go there any more”)
- rejectors (“I don’t go there”)
- unaware users (“I’m not familiar with the PDV”).
2. Classification of reasons for non-use or under-use
- DIRECT factors – relating more specifically to the retailer’s own actions, on which the retailer can and must act directly (e.g. staff, cleanliness and appearance of the outlet, misunderstood communication, brand positioning, etc.).
- INDIRECT factors – these relate to the competitive environment, to which the brand can only react, such as the presence of competitors’ outlets in the vicinity and competitive marketing pressure.
- SITUATIONAL factors – these relate to the local area and the consumer, and no action can be taken over them (except through below-the-line techniques). Examples include the birth of children, a change of job, or job loss.
3. Levers for win-back
The best possible conclusion of this type of study is that we, as a company, are responsible for the lost sales, and that any issues within our control can be resolved by us. However, the most problematic conclusion is that underperformance is due to factors beyond our control, such as the social structure of our customer base, their inertia, or their objective circumstances.
The impact for the client
The study revealed that the two retail outlets had different histories.
Point of Sale A was operating in a highly competitive environment and was not actually suffering due to the presence of neighbouring retailers. Rather, it was suffering due to a lack of staff presence, particularly at the service counters. In a context where local shops are heavily utilised, the advisory service, assistance with purchases and social interaction typical of small shops (such as butchers, bakeries, fishmongers and greengrocers) required a level of service for fresh produce that was more in line with the standard expected.
The reasons for the underuse of Point of Sale B were linked to the local context. Its location was not well served by vehicle traffic (local residents did not use the main road on which the point of sale was situated). The chain was thus able to reorient its out-of-home advertising (billboards and leaflets) towards a wider catchment area, but one inhabited by people who were obliged to use the main road for travel reasons and who, until then, had not given the supermarket a second thought, viewing it as just one of many. Messages emphasising freshness and product range enabled the store to attract more loyal customers from further afield who could take advantage of their commutes.
Correctly analysing the underlying motivations and profile of ‘non-customers’ enabled the retailer to boost sales and avoid the feared closure of the two outlets, as well as a consequent loss of investment.
Ad hoc solution: Why Stop Why Go
This case study illustrates that market performance depends not only on the quality of the offering or competitive pressure, but also on less visible factors that influence people’s decisions, such as habits, context, local dynamics, and expectations and motivations that can encourage or hinder a purchase.
‘Why Stop Why Go’, part of the Eumetra Ad hoc Solution suite, is a research framework that helps businesses understand the reasons behind unexpected underperformance or success that exceeds expectations. It transforms both situations into opportunities for improvement and growth.
Through an integrated approach, the study reconstructs the customer’s decision-making process by analysing the competitive environment, behaviours, relationships, and influencers that affect purchasing choices. The aim is to identify and measure the impact of the various factors hindering or driving the market, creating a map of levers on which the company can act through fine-tuning, win-back initiatives, or product/service development.
Understanding why customers stop coming is the first step towards bringing them back. Understanding why they choose us allows us to replicate that success systematically.
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