Family Dollar's New Store Projections
More Accurate with PopStats Data
Before 2001, Family Dollar faced an ongoing challenge: The accuracy of new
store sales projections varied significantly. While accuracy still has room for
improvement, there has been tremendous progress already. The key reason, says
Brian Strickland, is STI: PopStats™ data.
"Prior to using PopStats, we identified a pattern in our new store projections:
Our stores tended to under perform in high-growth areas," says Brian, Director
of Strategy, Testing, and Market Analytics of the North Carolina-based company.
"After we incorporated PopStats population estimates into our sales performance
analysis, our store projections were much more accurate in these areas.
"Having the right population counts was essential," he adds. "PopStats has the
rare ability to capture real growth as it occurs. This is especially relevant
to us in high-growth areas, where population counts are very dynamic."
Searching for Optimum Site Projections
Brian says that after learning about PopStats from a GIS vendor, Family Dollar
tested the data's household estimates in a few of the company's high-growth
markets. They specifically chose markets where the sales force said that their
population data was not accurately reflecting field real estate knowledge and
local population data.
The chain store tested PopStats against its previous data provider's population
estimates in three to four markets across the country and found "the difference
was consistently significant enough to impact the accuracy of our sales
projections." After its comparison testing, Family Dollar signed up for annual
updates of PopStats.
Brian says that when he first reviewed PopStats he was "impressed and intrigued
that a data company was using such a sophisticated methodology to estimate
population counts today and project them into the future."
Looking Beyond Population Estimates
In addition to household population estimates, Family Dollar's market
researchers also access PopStats data on household incomes and STI: LandScape's™
neighborhood categories. "It is important for us to know not only the amount of
growth in each market, but also the household incomes of the people living
there," notes Brian. "It's great if there is rapid growth, but if it's not on
target with our target customers, then the growth is not meaningful to us.
PopStats is also more accurate in its income data than our previous data."
Family Dollar receives important insight from the LandScape's consumer lifestyle
segmentation data, says Brian. "We have found that STI's consumer segmentation
data brings enormous value to the development of the models we use in our market
potential analysis. LandScape's neighborhood categories help to explain
performance differences among our stores, because our high-performing stores
tend to share similar consumer lifestyle demographics."
Family Dollar couples its demographic market research with competitive analysis
and a unique site quality analysis, which the research department created to
quantify and measure site characteristics such as co-tenants, visibility, and
road class. The researchers adjust store projections up or down based on the
results of its site quality analysis.
Family Dollar celebrated its 50-year anniversary in 2009, at which time it had
6,600 stores in 44 states. The chain is planning to open 200 new stores this
"Our research is all about choosing store locations that will deliver optimum
performance," explains Brian. "We choose the analysis and data that will best
help us achieve that goal like PopStats."
Improve Your Site Performance Projections
To gain more accurate site performance projections like Family Dollar, contact today
Synergos Technologies about the STI: PopStats data suite today.