This is the 2nd blog post in this mini-series.

3 Steps to Increase Sales Now – Purchasing Frequency

In the last post on The Smart Way to Increase Sales, we established that:

1. You don’t necessarily need to implement new sales training or strategies to help your sales people become more effective at selling, and

2. You DO need easy access to analytical dashboards in order to see what the sales data tells you about new customers vs.  current customers, and how you need a good balance of sales between each group to grow revenues.

The next data point you need to become intimately familiar with is purchasing frequency.

Why purchasing frequency?

If you’re able to increase the frequency with which a customer buys from you, you increase sales!

To measure frequency, look at a month. If you want to measure frequency in days, take the number 30, and divide it by the number of times each customer bought from you.

So for example, if a customer bought from you 3 times in one month, the formula is: 30/3 = 10. That customer buys from you every 10 days.

To get a more accurate picture of frequency it’s best to look at the last 3 months.

Use this data to find out how to increase purchasing frequency: special promotions? Better marketing to your customer database? If you’re a retail outlet, in-store events?

One of our local supermarkets has live music by local bands on a regular basis, a great way to increase shopping frequency. Your customers are there in the patio listening to music, they might as well go into the air-conditioned store to see what they can buy, right?

Frequency as a Predictor of Customer Attrition

Following the Key Performance Indicator of buying frequency can also help you predict and take preventive measures to keep customers from leaving you.

For example, if you notice a downward trend in shopping frequency by a particular group of customers, that might mean they’re starting to buy from the competition. What preventive measures can you take to avoid this?

A supermarket chain was able to increase sales by following this indicator.

Most families will make a major shopping trip for their household once a week. However, supermarket management noticed that many families did major shopping trips every two weeks, and some only once a month.

They decided to survey their customers and found some interesting factors that led to decreases in shopping frequency:

• Unfavorable pricing for key food items
• Quality of service issues
• Inconvenient store locations

The supermarket chain decided to undertake measures to correct these issues.

What about in a B2B scenario? That’s easier. You have the customers’ names, phone numbers and email addresses. Sales managers can create call lists for their sales reps to call customers buying from you less frequently to find out what’s going on.

It’s all in the data.

Next, we’ll explore the role of average sale per customer.

Stay tuned…

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