What do Strawberries and Candles Have in Common?

So, admittedly I am not part of most retailers' dream demographic. I am older, no longer a Gen-Anything, and I hate shopping. So does that mean I am on my way out? Do retailers really care anymore what I do with my discretionary dollars?

The answer, of course, is yes.

And if retailers care about earning their fair share of my discretionary spend, they must be innovative. Retailers who want to distinguish their goods and services to meet the personal demands of every customer must recognize that differentiation is not just about what is selling, but much more about who is buying…and why.

What Else is in Your Basket?

Take for instance a Market Basket study that I conducted not so long ago when I was a merchant for a big box retailer. I managed the area where candles, clocks and ready-to-assemble furniture could be found. Believe me, this was not necessarily the easiest place to drive sales. Most of the items in that category were not impulse items; they were "buy when you need them" products.

So in attempt to grow the business, rather than restricting my analysis to sales of any one item, I began looking at complete baskets where my items sold. I was trying to find correlations with other items in the shopping cart. Imagine my surprise when I discovered that the number one item sold with scented candles was…strawberries.

Strawberries? With scented candles? Really? Why would that be true? What could possibly be driving shoppers to regularly buy such very different items at the same time?

Of course my team had fun with these questions. Maybe it was a guy that was in trouble at home, they said. What better way to make up with the wife then to give her strawberries and scented candles. How romantic. Or maybe it could have been a newly single woman enjoying a long bath surrounded by scented candles and feasting on decadent strawberries.

Real Analytics Lead to Real Results

Their theories were endless and sometimes hilarious, but the analytics were real. I realized if I wanted to sell more candles, I was going to have to partner with the strawberry buyer. Together, we theorized that merchandising the two items together on a great little end cap or across the aisle from one another made sense. According to the analytics, sales should increase. I mean, they would no longer have to look all the way across the floor for each item individually, right?

And you know what? Sales did increase. The numbers did not lie, and we won the game (at least this time, anyway).

That victory would not have been possible, however, had the company I worked for not invested in analytics. Retail analytics can create incredible opportunities for retailers at every level and in every category. Market Basket Analysis, a key aspect of Customer Relationship Management (CRM) is not just for brick and mortar stores, either. The best CRM programs use technology and analysis to help merchants understand the customer at the core of their shopping behavior, no matter when, where or how they shop.

I learned first-hand how studying customers in all channels can improve business relationships, increase customer retention and drive sales. Shoppers want retailers to know who they are and what they want, even when they may not necessarily know what they want themselves.

New Possibilities

Imagine the new possibilities empowered by Market Basket Analysis. Imagine a customer has purchased an amazing blouse online and requested that it be delivered to the store for pick up. We know from our analysis that the blouse she bought has been paired with leggings and a floral scarf by the majority of the women who bought the blouse. Using that information, we can do a number of things to increase revenue. We can offer the paired items at checkout online. We can include a package-stuffer including an image of the paired items and a coupon.

Or we could instruct store associates to suggest the pairing when the blouse is picked up at the store. When we consider that 90% of all purchasing decisions are made subconsciously, suggestive selling based on a shoppers' past behavior has a tremendous chance for success.

Editor's Note: Victoria spent 13 years as a merchant with several retailers, and now works for Aptos as a Solution Consultant specializing in Retail Analytics. If you'd like to learn more about how analytics can fuel more effective CRM strategies, send Victoria an email at VMoore@aptos.com.