KPI of the Day – Retail: # Time spent in the store
Measures the length of time spent, on average, in-store by prospective customers (for the purpose of shopping).
To indicate the opportunities for the customer to increase the shopping volume and value.
The time a customer spends in the store may be an important indication of the opportunity for increasing the shopping value and volume. However, in some cases, this KPI might provide an indication of situations when a customer does not find quickly the product he is looking for.
The longer customers browse through a store, the higher the chances are that they will acquire greater amounts of products, thereby increasing the value of purchase. Research shows that for each 1% increase in the time spent in the store there is a 1.3% increase in sales. For this reason, # Time spent in the store, also called # Customer dwell time, is a KPI that should be monitored closely in order to capitalize to the fullest on the store’s potential.
Furthermore, increased periods of time spent in a store by shoppers are indicative of greater customer satisfaction, since this usually implies customers are having pleasant purchasing experiences. Creating the necessary conditions for customers to positively perceive the store and increase the time spent thus leads to mutual benefits.
In this regard, it is paramount for companies to identify the reasons for their customers’ prolonged # Dwell time: the possibility exists that customers spend increased periods of time in the store because they are unable to find the desired products.
Should that be the case, the consequences are negative for both the retailer (the customers are focused on their target product and will not purchase additional ones until they reach their purpose) and for the customers (not being able to locate the desired product is a source of frustration and dissatisfaction).
In order to obtain good results for this KPI, industry best practices include the following:
- Inducing a positive customer service experience through trained and motivated staff members;
- Designing the store layout in a pleasant manner by avoiding clutter and excessive advertisements and placing fresh products towards the store’s entrance (flowers, baked goods, fruits, and vegetables);
- Creating an enjoyable retail environment atmosphere by utilizing lights, scents, and suitable background music.