Monday, December 15, 2014

Basket Analysis II: Would you like a drink with that?

This is the second post in a series on Basket Analysis. To read the first post go to Basket Analysis I.

A common question a customer receives when ordering food is "Would you like a drink with that?" This is an example of on-selling, where the customer has come in with an order, and the salesperson, cashier, etc. looks for an opportunity to increase the size (and profit contribution) of the transaction, and potential satisfaction of the customer, by inviting the customer to add another item to the transaction.  The activity can be much more subtle, such as "We have some hot-from-the-oven blueberry muffins today - would you like one with your coffee?" The intention is the same, and the activity usually involves some staff training and encouragement. Naturally, some training sessions are better than others and some supervisors, motivations, etc are better than others at encouraging staff to invite these on-sell opportunities. Basket Analysis is a great tool to help monitor and analyse the effectiveness of staff, training, and promotional activities. For example, a program could be developed to encourage staff to offer oven-hot blueberry muffins. Without Basket Analysis tools, a sales report might display the ratio of blueberry muffins per 1000 transactions to compare various staff, training programs etc. However, this report will be inappropriately affected by a customer purchasing a dozen blueberry muffins in one transaction. Basket Analysis will provide metrics such as % of hot drink transactions that contain blueberry muffins.

The charts below report on the effectiveness of the training campaign.  The top graph shows that all 6 cashiers are handing similar numbers of transactions with hot drinks.  The training campaign was conducted during week 29. Notice how most cashiers increased their attach rate of muffins by about 30%.  Elizabeth did not change her attach rate (maybe she missed the training) and Barry's attach rate increased, but not as much as the other cashiers.

For the next Basket Analysis post see Basket Analysis III.

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