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Study helps retailers calculate customers' potential spend

April 18, 2012

Acxiom Corporation, a provider of marketing services and technology, has announced its latest Consumer Dynamics study, "What Your Customer Is Buying When Not Buying From You," which highlights consumer spending potential for major retail categories.

In the study, Acxiom analyzed consumer purchase data from multiple retailers across the country for a variety of retail categories. The final product, a series of retail spend indicators, enables retailers to see beyond their own purchase data to estimate their customers' total category spend. These indicators enable retailers to more accurately determine share of wallet and to prioritize promotional expenditures.

"Retail spend indicators provide insight to more efficiently engage underserved customers. Traditionally, retailers have relied largely on their own sales data. With these indicators, retailers now can have a more accurate view to the true category potential of their customers," said Jim Harold, general manager of Acxiom's Consumer Industries Group.

Several results indicate the revenue potential of retail spend indicators. For example, applying the indicators against a major retailer's shoe department highlighted a 17-34 percent revenue upside:

• Among the retailer's top 15 percent spending customers, additional revenue potential of 17 percent was identified. Said another way, this retailer's best customers were spending tens of millions on shoes with other retailers.
• Among this retailer's lowest spending customers, additional revenue potential of 34 percent was identified. These "low spenders" in reality were high spenders, just not with this retailer.

Read more about consumer behavior.