Retailer Services - Consumer Research, Location Selection and Expansion Strategy by FSP

7/25/2019 Retailer Services - Consumer Research, Location Selection and Expansion Strategy by FSP

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FSP RETAIL BUSINESS CONSULTANTS

FSP Retail Business ConsultantsHelping retailers make informed decisions


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Retailer Services


Market IntelligenceCompetitor/ CannibalisationImpact AnalysisCustomer DemandForecastingCustomer ProfilingConcept Development

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TurnoverEstimation

Brand &ConsumerResearch

ExpansionStrategy

LocationSelection

In addition FSP provides:

The FSP approach is not simply about analysis. At its heart, FSP Directors are retailers andover 100 years of retailing experience is directed into every project to test, challenge andprovide advice, before it is offered to clients. We share your passion for retailing.

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Retailer Clients


FSP and sister company Pragma advise a variety of retailers including:

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Example Retailer Case Studies


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Business ContextThe client is one of the worlds leading sport sfootw ear brands. The brand has a strongreputation among serious sports enthusiasts,as well as those seeking a bl end of perfor manceand fashionability. Although th e company hasbeen manufacturing i n Cumbria for 30 years,current UK distribution is primarily throughspecialist sports op erators such as Sweatshop

and generalists such as Schuh.

Case Study: Global Sports Footwear RetailerService : Location Strategy & Brand Awareness

FSP was commissi oned to assist with the search for an optimal location f or a new flagship st ore, byproviding insight into suitable London sub-markets .

The ChallengeIn order to strengthen its retail presence and grow brand-awareness in the UK,the client sought to establish a network of company stores, including a flagshipExperience store in London. The aim of this Experience store was to promotethe brands wider range of lifestyle footwear and apparel, as well as celebrateits heritage of producing quality shoes for sport.

What We DidCustomer Insight: FSP segmented and quantified customer demandusing our unique FISH categorisation system. We gave detailed insightinto key performance influencing factors including catchment populationsand customer demographics. Understanding the catchment profiles andconsumer Lifestages was imperative for pinpointing ideal store locations

Location Selection: FSP identified key trading streets includingcompetitor locations, existing channels of distribution and sub markets.FSP provided street summaries identifying important KPIs suitedspecifically for the client

Benchmarking: FSP identified, by location, areas of competition fromsports retailers and footwear retailers and provided turnover and densityestimations to help grade the opportunity for the client. Other data providedincluded: number or stores, FISH and price positioning, Zone A rentallevels, estimated floor space, nearby tube stations, and breakdown ofresidents, workers and tourists

Result FSP submitted a list of recommendations based on th e insights pr ovided.

The client was keen to follow and apply ou r insig ht into t heir roadmapstrategy prior to instruction on a new store in London .5 October 26, 2015


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Case Study: Example Location Trading Report

Source: FSP/CES/GOAD

Neal Street Urban Outfitters Diesel

Total Selling Area (ft) 135,000

Estimated Retail Sales (m) 162

Average Sal es Dens it y (/ft )* 1,200

Average Sel li ng Ar ea (ft )* 971

Assu red Ind ivi dual Retai lers 12

Sports Retailers 6

Footwear Retailers 17

*Excluding Department Stores

KPIs for Seven Dials, Londo n

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Case Study: Example Segmentation Analysis

FSP RETAIL BUSINESS CONSULTANTS7

Seven Dials is located to the north of

Long Acre in London and includesbrands such as Urban Outfitters, Nike,

American Apparel and SuperdryThe area is home to Neal St, aspecialist footwear destination whichincludes Offspring, Josef Siebel, Toms,Superga, Office and Size?The FISH mix is favourable, with highproportions of both Young and Assured retailers, however footfall is relativelylow compared with other centralLondon locations

Source: FSP/CES/Nash Bond/Transport for London/NWEC

0

10

20

30

40

50

60

70

Clothing &Footwear

PersonalGoods

HouseholdGoods

LeisureGoods

DepartmentStores

Food &Beverage

Others

N u m

b e r o

f R e

t a i l e r s

Young34%

Assured45%

Family14%

Classic7%

C&FFISH

UpperMiddle41%Middle

53%

LowerMiddle /

Value2%

C&FPrice

Premium4%

Zone A Rent (/ft) 450

Footfall Index 26

Footwear Market Size (m) 8

% Residents 46

% Tourists 50

% Workers 4

Nearby Tube Stations(Annual Exits, millio ns)

Covent Garden (11)

Leicester Square (20)

Holborn (17)

Key Location Information

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Case Study: Major Swedish Hardware ChainService: UK Expansion Suppor t

FSP was commis sioned to pro vide insight and direction as the client sough t to expand their UK presence.They required an understanding of their UK shoppers and assistance in priorit ising new locations.

The ChallengeThe client had developed a mature business in Scandinavia where theirshopper was readily identified and successfully targeted. The challenge wastranslating this shopper into other markets, including the UK, and then ensuringthat chosen locations were suitable. Expected turnovers were also reviewed, tocheck they fell in line with board expectations.

What We DidFSP delivered a suite of reports and supporting evidence to the clients UK teamthat could then be incorporated into their recommendations to the main board inSweden.

Shopper Profile: Using demographic profiling, FSP closely classified the preidentified client shopper and used this to create a demand surface. Thisallowed FSP to classify locations with high numbers of key shoppers

Turnover Estimation: With detailed knowledge on catchment dynamics andmarket penetration, FSP was able to estimate site turnovers for the identifiedlocations

Benchmarking: FSP ranked identified locations against existing portfoliostores and competitors in terms of turnovers, catchment sizes and keycustomer profiles

Result FSPs analysis highlighted how trading performance relates to factors suchas competitor pr ovisio n, catchment size and lifestyle preference for thebrand of fer. The top 250 sites, in terms o f estimated turn over, were deliveredto form their expansio n strategy targets. The data was also used by

marketing teams to assist activity and to bui ld interest in their stores.

The client, a Swedish hardw are store chainand mail-order firm th at specialises in hardware,home, leisure, electrical and multimedia prod ucts.It is one of the big gest of its type in Scandi navia,with a total of approxi mately 180 stores. In 2008,the company opened its firs t UK retail store inCroydon , South Lo ndon. It later opened 13 furth erstores across the country.

Business Context

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Case Study: Report ing Outputs FSP supplied the client with a deck of supporting evidence for the UK expansion team to incorporate into

recommendations for their Corporate Board.

FSP identified specific location retail catchment potentialFSP ranked benchmark towns by expenditure

We constructed a scorecard methodology to help rank identified target locations. Client specificindicators were used to identify the optimum mix of attributes for any location.

050

100150200250300350400450

M o

d e

l l e d C u s

t o m e r

P o

t e n

t i a

l ( k )

Location Total Key ClientShoppers% Key Client

Shoppers

No ofComplimentary

Retailers

% ofComplimentary

Stores

% MultipleClothing &Footwear

Representations

TotalWeighted

Client Score

Client Ranking(based up on

weights)

Client Ranking vsShopper Pop

Ranking

Location A 3 6 28 8 1 201 1 12

Location B 23 2 10 9 23 283 2 34

Location C 7 7 16 20 48 334 3 16

Location D 24 32 18 7 1 379 4 219 October 26, 2015


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Case Study: A Leading Linen and Homeware Retai lerService : Concept Testing

FSP was commis sioned to help the client gain valuable insight into cu stomer feedback on their new store concepts,packaging and product ranges.

The ChallengeThe clients primary channels of distribution for the UK were department storeand concession led. The challenge was to create a flagship stand alone storethat would represent the brand to its full capacity whilst testing new conceptsand products for future store roll out. Using qualitative research, FSP advisedon the key requirements of consumers that would give the store the bestchance of success. It was essential that the concept was in tune with thebehaviour, merchandise expectation and locational requirements of keycustomer groups.

What We DidFSP worked closely with the client to identify the areas where qualitativeresearch could support with detailed feedback. This was used in conjunctionwith desk- based analysis to provide a fully informed set of results.

Qualitative research: FSP ran a series of focus group split by geographicallocation and family composition. Participants were hand picked, utilising acareful screening process to represent the brands true customers in keytrading locations. Questions were closely in line with the required aspirationsfrom the clients internal teams

Customer profilin g: FSP analysed existing customer postcode data bydemographic profile, allowing an estimate of penetration by shopper type tobe made. The ideal shopper could then be evaluated and was used to identifyideal benchmark locations for future store expansion, in light of currentconcession footprint and complementary retailers

ResultThe feedback was evaluated and p resented with recommendation s to th eclients board, wh ere it was used to sh ape the location, look and feel of

the brand throughout all it s consumer touchpoints.

The client specialises at retailing tow els,bathrobes and bedlinen in stores throughout theUK. The company sells o nline and in Europe, theU.S. and Australia. The company h as a long -termrelationship w ith tennis, producing the towelsused by players on c ourt at Wimbledo n since 1987.

Their UK business is predomin antly viadepartment stores and concessi on stores and asmall numb er of outlet centres.

Business Context

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Case Study: Focus Group Output FSP was able to respond to and advise the client on the full range of aspects listed in their initial

requirements .Recommendations not only related to the type of customer or location but went into greater depth toaddress key topics for them relating to product, packaging, customer service and store format.

FSP communicatedthe major mot ivators

that inf luence theshopping behaviourand spendingpatterns of customerswithin cli ent stores.

The analysis helped theclient to enhance notonly the look and feel ofthe stores but to alsoaddress customerservice improvements.

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Business ContextThe client, a Briti sh fashion and l ifestyle brandthat sells cloth ing, footw ear, accessories andhome products inspired by British countrylifestyles.The company has 99 retail stores in t he UK with aturnover o f over 117m. The brand has sinceexpanded overseas with particul arly successfulsales in Germany and USA.

Case Study: A Briti sh, Li festyle Retail erService : Location Selection, Turnover Estimation

FSP was commissi oned to provide insigh t and direction as the client sought to expand across the UK. They requiredassistance to prio ritise a list of target locations. FSP constr ucted a bespoke and robust model to help identifypotential new locations and to predict gros s sales .

The ChallengeThe client had developed a portfolio with a diverse and varied mix of storelocations. The model generated by FSP had to provide strong indicators ofpotential new store performance and comparable analysis for locations asvaried as regional flagships to seaside towns.

What w e did

A robust and tangible model had to be developed by FSP to assist the selectionprocess. Elements of this model are outlined below. Shopper Profile: Using demographic profiling, FSP classified the clientsexisting shoppers, and used this to create a demand surface. This allowedFSP to identify towns with high numbers of key shoppers a key factor inidentifying potential new sites

Key Revenue dri vers: A number of factors were tested against existingstores gross sales. Several factors were identified as important drivers ofgross sales, these included:

Floor space provision relative to market sizeWhether or not the town was an NSLSP Top 200 location

Number of key shoppers in the catchment

Number of residents aged 25-44 in the NSLSP catchment

Result FSP delivered a model that had a high degree of accuracy in predicti nggross sales. We worked closely w ith the clients in ternal teams inproducing a prioritised list of locations to fo cus on .

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Case Study: Recommended locations

FSP supplied the client with an interactive web based portal (DELV Data Enlivenment andVisualisation) to provide key data and further understanding for each of the FSP identifiedlocations.

Shown are current stores (as of 2012), andpotential new sites, identified by FSPWhen new sites are selected, a text box withkey demographic characteristics is shown,allowing the client to view sites at a glanceand prioritise stores based on a range ofspecified characteristics

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Pragma & St. Ives Group Global Expertise

FSP RETAIL BUSINESS CONSULTANTS14

InternationalStrategy

SpaceConfiguration &

Planning

Market Analysis

Brand &Concept

Development

CustomerInsight

Financial Analysis &

Modelling

Market Segmentation Market Projections Competitor Mapping

Space Allocation & Utilisation Space Configuration Concept Generation & Mix

Brand Positioning Concept Development Tenant Mix

Customer Attitudes Customer Segmentation Catchment Analysis

Trading Performance Space Supportable Footfall Forecasts Commercial Performance

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Testimonials


FSP's retail experience has given us knowledge of the tradingpotential of new sites, while their clear advice on local marketstrategy has had a direct impact on our approach. Mark Gregory, Managing Director

I am very pleased to have given the approval to the research as this

really does appear to me to be money well spent. Robert Wood, Fund Manager, Continental European Real Estate

I think this is an extremely good piece of work. The amount of insight

relating to what customers want is amazing. You all did an excellent job. Alexandra Pet it , Group Head o f In sigh t, Hammerson Plc

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FSP RETAIL BUSINESSCONSULTANTS

19 Manor CourtyardHughenden AvenueHigh WycombeUK, HP13 5RE

T +44(0)1494 474740F +44(0)1494 [email protected]

www.fspretail.com

www.snap-shop.co.uk

Simon RosenbergSenior Consultant

T +44(0)1949 474740M +44(0)7495 638285F +44(0)1494 474262

[email protected]

Retailer Services - Consumer Research, Location Selection and Expansion Strategy by FSP

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