Last year, you had 100,000 customers, and you sold $12,000 of a certain item.
This year, you had 150,000 customers, and you sold $16,000 of a certain item.
Clearly, your merchandising team is doing a great job with this item, right?
- Last Year's Demand per Thousand Customers = ($12,000 / 100,000) * 1,000 = $120.00.
- This Year's Demand per Thousand Customers = ($16,000 / 150,000) * 1,000 = $106.67.
Now, I get it ... if you featured the item in catalogs more/less frequently, or in email campaigns, then the metrics will be impacted. But for most items, this isn't the case. Consequently, you can get a directional view of merchandise productivity by controlling for the number of customers who purchased in the past year.
This metric can be adjusted - for great customers, for average customers, for marginal customers, for new customers ... your choice.
But you owe it to your merchandising team to tell them, in a changing environment, how items are performing, correct?