Page 85 - Spring Into Markets

Average transaction values (ATVs) and average number of Items
What is your current ATV? Why are ATVs and the average number of items bought important to monitor? It is important to know how much your typical customer spends at your stall. Being aware of your ATV and also the average number of items that a shopper buys from you will help you to consider how you can increase these two figures. By increasing them you will be achieving two principle business goals:
There are two ways you can increase ATV.
One way is to trade customers up, i.e. sell them a product at a higher price point. Whilst this is part of the answer it does not necessarily mean you are providing the best customer service and maximising profit.
The other is to sell more to your existing customers, i.e. customers buy two items instead of one therefore the transaction value increases. However, you will only be able to achieve this if you really know your customer and what their retail needs are.
Understanding your customer — it’s where to start...
As with everything you do in your retail business it starts (or should do) with the customer. Really understanding the customer, who they are and what they need is realistically the only way you will successfully generate important extra sales. A good ‘retailer’ whether that’s a trader or a High Street outlet understands what customers want and finds ways to offer this. The really good ‘retailers’ pre‐empt this need and know what customers want even before they do! You need to become a really good ‘retailer’!
Supermarkets are a good example. As shoppers have become short on time, convenience has become what they need — we have seen a growing range of convenience solutions, pre‐packed meals, hot food to go and more recently internet shopping. Someone else does it and brings it to your door, it doesn’t come more convenient than that!
In a reaction to the ‘credit crunch’, food stores and supermarkets have tapped into a customer’s need to save money but to still treat themselves. As a result,
‘Dine in for £10, £20’ and other meal deal offers have become commonplace.
1. Improving customer service 2. Increasing profits
Guide 12 Creating Extra Sales 85