Initial Analysis of Regional Sales Data

The location data are frequently compiled as the number or percentage of customers by geographic region. Often, the location unit is a zip-code or phone-exchange, as such data are often collected simply by asking customers for it at checkout.334 Many major retail establishments have used this approach to collect customer location information.

Such data usually need to be aggregated to show sales by geographic region and distance. Normally, the regional sales data should be collected into a matrix. One column is the distance of the region from the point of sale. The second and succeeding columns consist of sales variables, such as:

• Total sales revenue for that region

• Number of unit sales for each region

334 There are other methods as well. Special "club" cards that connect customer purchases to their location are sometimes used, although customers must normally be given some incentive to provide this information and shoulder the burden of carrying it and presenting it at checkout. Surveys, including "intercept" surveys of actual shoppers, can also be used. However, be cautious when using survey data that is contaminated by self-selection bias or poorly designated questions.

• Percentage of a retailer's sales that can be attributed to each region

• A retailer's penetration rate in each region, if data are known for competing retailers335

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