Articles

The Myth of Dwell Time

It never ceases to amaze me how many people in retail have convinced themselves that increasing dwell time leads to increasing profits in every area of retail. This comes from the surface analysis of data that links time spent shopping with basket dollars, without the insight into why.

Retail is a sustainable productivity gain model running a continual innovation process to support it. Data is an important input into such a model, but data is only used to gain insight – which in turn should be used to create new initiatives and refinements to be tested for gain.

There is no doubt that historical data indicates that the customers that spend the longest time in the store spend the most money. In ninety-nine percent of cases this about the physical requirements of time to spend money. That is, the customer is forced into spending time in order to select goods by virtue of the retailer’s operational model and physical limitations.

But it is not in either the retailer’s nor the customer’s interest to increase dwell time.

From a retailer’s point of view you want to get more out of your fixed costs and fixed resources. As space and time are fixed, you really want more customers going through the store spending more money. Increasing dwell time physically limits customer throughput.

From a customer’s point of view time is the new gold. Every minute counts and the fastest growing social trend affecting shopping today is the aggravation felt by customers who perceive their time is being wasted. Forcing them to dwell longer than is necessary is counter-productive.

The key to sustainable productivity growth is not increased dwell time.

It is finding ways to help the customer spend less time and more money. That is, being seen by the customer to care enough about their time to save it for them and get them on their way. This is efficiency that meets the agenda of both the shopper and the retailer but it requires careful thought.

Increased basket size is the desired outcome. Analysing every point on the retail C.O.M.P.A.S.$. ® – cultural behaviours; organisational model; merchandise; promotion; access; selling environment; and $dollars and pricing architecture – allows best practice retailers to contrive an outcome that requires less of the customer’s time to spend more money. This in turn frees up physical capacity to put more customers through the store.

Industry paradigms can entrench bad practice. Practice we often don’t stop to challenge but rather allow to become belief. Likewise data is certainly your friend when you know how to gain insight from it. But belief looks for data that supports it rather than challenges it.

Save time and you’ll make money. If you don’t believe me, just try it.