Électro Dépôt, specialist in low-cost household appliances and multimedia products, set up in the summer 2014 a study of the catalogue distribution zones using the CoSpirit M3 cartographic tool. Maureen Govart, the brand’s Communications Manager, explains the impact on the shop’s support.
Can you present Électro Dépôt?
Électro Dépôt is a low-cost brand specialised in household appliances and multimedia equipment and is a member of the HTM group. We have applied a low-cost strategy for our customers and consequently are constantly looking for the lowest prices for our products, everyday. We also develop products for our own brand that are very affordable and therefore accessible to large numbers of people. Électro Dépôt has more than 1 600 collaborators who work in 66 shops.
Électro Dépot spends an large part of its communication budget on making and distributing catalogues in mailboxes.
You carried out an important study on redefining distribution zones with CoSpirit…
Our communication budget is not very big in order to limit internal costs and therefore be able to propose low prices. It’s true that 80 % of our communication budget is dedicated to the management of our catalogues. It’s our most important form of media.
Until now shop managers defined their distribution zones by a process of rough estimation, based on their local knowledge and on wherefrom they thought their customers came and where they thought the most efficient zones were. It was quite rough and based on guesswork. They had no tool to evaluate the return on investment.
With CoSpirit we completely reviewed and redefined distribution zones based on a profitability criteria. This work also allowed us to optimize the number of catalogues per shop. The results of the study were presented with a cartographic tool, called M3, which is very clear, visual and easy to use. It allows shops to clearly see the origin of sales revenue and the effect of the distribution zones. In the medium-term we have one objective: to be able to perfectly define our shops’ catchment areas in order to distribute catalogues to the right number of households, which will allow us to be able to spend more on other medias such as radio, displays, digital, social networks…
How does this M3 cartographic tool, created by CoSpirit R&D teams work?
This tool systematically links sales revenue to postal codes: information that we get at the cash desk. This enables us to present, using different colours, the most profitable neighbourhoods with detailed geographical statistical information. We also add to this, via our distributors, the distributed neighbourhoods. These two indicators combined enable us to get a map that focuses on what the distribution of catalogues produces in terms of turnover.
We also have a map of the past 12 months in order to evaluate the impact of the distribution of catalogues. In fact, a catalogue can have a short-term impact on traffic, but can also have a medium or long-term impact on the image of a brand. This enables us to highlight the most reactive neighbourhoods regarding catalogues.
What impact did the study have on the redefinition of catalogue distribution zones?
The first consequence was to see that it was necessary to adjust the number of catalogues by shops. Numbers had been underestimated in some shops, overestimated in others. This has been adjusted, with numbers increasing by up to +35 % in some shops and decreasing by -40 % in others.
How did you carry out all this work on redefining the zones?
A national study of catalogue distribution was launched, but at the end of the day it was still shop managers who made the final decision. So it was very important to present all the positive aspects of this study, for them to understand the advantages. To do so we named 4 regional pilots among the managers – which gave them another role in the company! I also took time during the summer to call the managers and explain the logic of the work on zone recommendations and why they could benefit from it.
Has it worked?
Yes, this work on recommendation together with the cartographic tool constitutes a form of long-term support. It doesn’t make local experience less important, but represents an additional tool.
The advice of Claire Brunet, manager of Électro Dépôt in Cambrai gives her advice
“The recommendation of zones and the cartographic tool M3 allows us to be more reactive!”
Claire Brunet, you are the manager of the Électro Dépôt shop in Cambrai and you have been one of the regional pilots chosen to help the brand set up the consultancy service proposed by CoSpirit. According to you, was it important to redefine the distribution zones of your catalogues?
14 people work in the shop, including three managers. It’s a small team, but we’re in charge of 1 600 square meters of sales area that welcomes on average 500 to 600 customers a day and 1 500 to 2 000 on Saturdays. The distribution of catalogues is very important for us, because it really has an impact on footfall in our shop. We are an old shop, even if we moved here only three years ago. Our clients are loyal and to increase our turnover we had to look for clients in areas further away where we didn’t work well enough.
How does the cartographic tool M3 help you?
This tool allows us to be more reactive. We can clearly see the profitability of each catalogue distribution and quickly identify which neighbourhoods (detailed geographical statistical information) are the most relevant for us. This really helped me improve my distribution. Added to this, CoSpirit’s recommendations really make things easier.
We’ve been using this tool for over a year and we’ve already seen an increase in our profits. In fact, we are one of the shops that has also seen an increase in sales.
What has changed since you’ve been using this consultancy service?
We have the feeling to have more control over distribution, without having to spend more. Every month we select the zones where we want the shop to improve. It’s long-term work, but the results are concrete and measurable.
If you wish to have more information on the study of the redefinition of zones carried out by CoSpirit teams that’ll help you improve your catalogue distribution, don’t hesitate to contact us!