Every month followers of retail performance await the monthly comparable store sales reports. If you aren’t familiar with this metric, it’s simply the year over year sales performance of stores open at least a year. Not a bad metric, but not really all that helpful.
A better metric would be “comparable customer sales.”
Is your company’s sales growth coming mostly from the segment that is the least loyal and only buys when you run a huge promotion? Or are you doing well with the full-price customer who is most willing to recommend your brand to a friend? How are you doing acquiring and engaging that younger customer demographic you always tell the analysts you aspire to grow?
Ultimately the only asset that really matters for most companies is the strength of its customer portfolio. This metric would give a much better indication of just how well your company is growing that asset. Not performing well with a strategic segment? Now you have the call to action to delve into the underlying performance driver.
I realize that even if your company had these customer driven metrics you might not be so willing to share them with Wall Street. But what’s your excuse for not having them for your own internal use?
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