Customer story: Branch Network Optimization in Retail
Drugstore Chain of 700+ Stores
TETA was awarded the title of “Retailer of the Year“ five times (by GE Money) as well as the retailer with the highest footfall (by Incoma Gfk). The company distributes drugstore products to 5500+ stores and produces more than 300 products.
Unoptimized Branch Network
Location Context for Business Decisions
The main business questions that TETA needed to answer were focused on the optimization of their branch network and location planning for new openings both to optimize the performance and expand the business. The following questions were not strongly supported by data and could not be easily answered:
- What is the potential of a planned location?
- What will be the impact on the current network if we open a new store at a certain location?
- In which of the current stores should we invest and which calls for termination?
- What is the pressure of internal and external competition in the given location (current and planned)?
- Are there any white spots left on the map?
- From where are our customers coming and who are they?
- Are we distributing our flyers in an efficient way?
- Does the redesign of stores increase footfall, customer loyalty, and the value customers bring?
Drugstore chain TETA has a mature and highly adopted loyalty program with more than 2,000,000 members. Using transaction data from this program and combining it with the external demographic data, CleverAnalytics enabled TETA with the needed insight enriched with location context. The location analysis brought the following:
- Catchment areas for stores and the entire network
- Penetration and share of members of loyalty program
- Market potential and market share of each store
- Overlaps of own stores within the network
- Market share of the network in various areas
- Market potential of proposed location(s)
- Increased return on investment on flyer distribution
Continuous Network and Direct Marketing Optimization
Retail network is like a living organism that reacts to even the smallest change in its surroundings. Thanks to CleverAnalytics, TETA's decisions are now driven by the most accurate data that is instantly updated and accessible online in an easy-to-understand map.