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Retail Dictionary Terms
Our data and expert insights are regularly featured in the retail and business press. We also publish blogs, case studies and whitepapers that explore the latest industry trends and best practice.
There are a lot of terms in retail analytics. You are likely to come across them when reading articles and posts, but do you know what they mean? This dictionary focuses on Retail Analytics terminology and aims to uncover the meaning of such words, their variant terms and acronyms that are sometimes used.
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Term: DEAD STOCK
Stock that is unsold or has been in stock for some time. Often applies to seasonal products but may simply be those that are not in demand.
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Term: BACK OF HOUSE RETAIL
Term used to distinguish the area of retail the customer do not see, where activities such as stock retrieval, cashing up etc are performed.
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Term: ELECTRONIC POINT OF SALE
In store computer systems that perform numerous functions, including payment processing, sales, stock inventory and gathering customer data.
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Term: Click and Collect
Where customers buy products online via a website and then come into a store to collect the item ordered. These customers provide upside opportunity for further sales in-store.
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Term: Comp Store Sales
The measurement of productivity in revenue, comparing sales of retail stores that have been open for a year or more, a pre-eminent measure in retail but be careful without the context of traffic and conversion rate metrics this can be misleading even given its status as a KPI
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Term: CONVERSION RATE
The percentage of customers that purchase from a location over a defined time period, calculated as:
Conversion Rate = the number of till or cash register transactions / Traffic.
(A transaction may have multiple products, but is only counted as one transaction.) -
Term: BRICKs AND CLICKs
A phrase used to link up a physical store with an online ecommerce proposition.
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Term: BRICKS AND MORTAR
Refers to physical stores.
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Term: ARRIVALS
Customers who physically arrive and check Into an appointment booking/queue system such as Gnats or Oudlnl solution as examples. Often used in service-based environments such as technology stores but could also play Into areas such as Kitchen planning, personal shopper sessions.
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Term: DWELL TIME
The amount of time spent in a location. Increasing customer dwell time increases their propensity to spend in a location. Malls have worked on this in recent years by increasing the number of food and beverage locations, the same principles apply down to individual zones in retail stores.
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Term: AVERAGE TRANSACTION VALUE
The average value of each purchase transaction over a defined time period, calculated as: ATV = total sales value / number of transactions.
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Term: AUGMENTED REALITY
Combining technology and real-world environment to provide an immersive enhanced customer experience and drive buying decisions e.g. Ikea uses AR to show customers what furniture would look Iike In their homes.
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Term: CUSTOMER BEHAVIOUR
Understanding of the way customers use stores – understanding the customer experience in order to improve the stores performance.
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Term: e-COMMERCE
Where customers buy products online via a website for delivery to a location be that home or to a store for collection.
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Term: INVENTORY TURNOVER
The cost of items sold divided by the average inventory. It is an analysis of the frequency of stock sold within a set time frame e.g. a month, year etc.
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Term: FRONT OF HOUSE
Term used for customer facing area, where roles such as sales assisting, till operations, changing room attendance are carried out. Typically moving more resource from the back of house to the front of house is a good thing to achieve creating more customer facing time, which should result in more sales.
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Term: OCCASIONAL TRAFFIC
The measure of active Wi-Fi devices detected by Wireless Access Points that return on a predetermined, periodic cycle.
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Term: OCCUPANCY
The number of people within a defined area/venue at any point in time. Typically used to manage capacity to a defined maximum point. This allows the maximum opportunity into the retail space whilst not exceeding any local restrictions imposed by perhaps mall operators or building regulations.
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Term: MERCHANDISE PRESENTATION MANUAL
A design strategy to help staff show how products will be displayed within a store, ensuring a consistent presentation of products across all stores of a retail chain.
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Term: Key Performance Indicator
A term used way beyond retail, basically one of the key figures that the business will be measured by.
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Term: NEW TRAFFIC
Is the measure of active Wi-Fi devices detected by Wireless Access Points for the first time, note each time an individual gets a new device it will be seen as a New Traffic. Typical cycle of a Cell/mobile phone is every 18 Months. Further for the initial period of setting up an environment to capture this data all traffic will be by its nature be defined ‘New’.
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Term: MISSED OPPORTUNITY
Missed opportunity is the calculation of the No Shows (to an appointment booking) x ATV.
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Term: MOBILE PAYMENTS
Payments made by a customer using a mobile device as a contactless payment method, as opposed to cash or a card.
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Term: Omni-Channel
A phrase used to link up a physical store with an online ecommerce proposition.
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Term: LOSS LEADER
A product sold below its cost price in order to generate footfall and attract new customers who might shop more widely from across the store which will drive profit.
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Term: NO SHOWS
Customers who make an appointment, but then do not physically check-in to an appointment booking/queue system such as Qmatic or Qudini solution as examples.
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Term: MULTI-CHANNEL RETAIL
A sales strategy that involves multiple channels to drive sales, such as bricks and mortar store, online retail and catalogues.
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Term: M-COMMERCE
Where customers buy products via a mobile device, whether via a website or using the device to pay in a bricks and mortar store.
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Term: REGULAR TRAFFIC
Is the measure of active Wi-Fi devices detected at Wireless Access Points that return on a predetermined, consistent cycle.
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Term: SALES PER SQUARE FOOT
The average revenue generated for every square foot of sales space, calculated as:
Sales Per Square Foot = Total revenue / Total square footage of sales S=space.
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Term: SELL-THROUGH RATE
A percentage representation of the stock received from a manufacturer vs. the volume of stock sold. A comparison.
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Term: RETAIL PERFORMANCE GRID
A two by two grid with individual stores plotted in relation to one another against two axis’s of CR and Traffic. A further dimension can be added to denote ATV by the size of the store bubble. this can be used to determine high level approaches to be applied to the stores, more marketing perhaps or greater operational execution.
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Term: Retail Traffic Index
A tracker of Footfall data. Comparing one’s own data, versus the equivalent aggregated data of the industry/industry sector/industry region.
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Term: Single Channel Retail
A phrase used to link up a physical store with an online ecommerce proposition.
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Term: TILL TENSILLITY
Number of shoppers/number of tills open in a defined time bucket.
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Term: SHOPPER INDIVIDUAL
Counting of every person who enters a store as a potential customer, which will affect the calculation of the CR%.
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Term: SHOPPER GROUP
Not every person who enters a store is a potential customer. For example, in a lingerie shop a husband and wife will enter, in most cases just one purchase or transaction will be made even though two individuals were counted. Using in built logic of the more sophisticated counting devices, this can be deemed to be a shopper group of one and thus will affect the CR % achieved.
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Term: PLANOGRAM
Visual representation of where products in a store should be situated.
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Term: POP UP SHOP
Setting up a temporary shop or retail space that can be used to test new concepts, brands ranges and to increase brand awareness in a new market.
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Term: POWER HOURS
These are the Peak sales hours and can be viewed by opportunity, traffic or by best Conversion period or best sales period, there is often a variance. By understanding these areas using statistical distribution the periods can be factually understood and acted upon to maximise returns.
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Term: TRAFFIC
The count of individual customers, either shopper Individuals or Shopper groups, entering a location over a defined time period. Typically derived from automated electronic counting devices at entrance thresholds.
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Term: STAFF STRETCH
Is the measure of customers to staff over a defined time period, calculated as: Staff Stretch = the number of customers / the number of staff.
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Term: STOCK KEEPING UNIT
A distinct type of item for sale (as defined in the retailer inventory management system). The SKU is intended as the most granular level when dealing with inventory.
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Term: QUARTERLY SETS
Traffic data viewed over a 13 week period.
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Term: SUGGESTIVE SELLING
A way of encouraging customers to buy additional items to their original intended purchase, an example would be when buying a suit it is common practice to suggest complimentary shirts and ties to increase the basket value.
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Term: S-COMMERCE
Using social media to drive the sales of goods, whether on or offline.
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Term: UNITS PER TRANSACTION
Is the measure of the number of individual items in a single sales transaction.
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Term: ZONAL
The traffic and dwell in defined areas, such as departments or aisles
Would you like to find out more about any of the Retail Analytics terms? Just get in touch with us!