Site Selection with Enterprise Sales Data: Using customer data to select new sites

Introduction

Two years ago, Janice Brown and Steven Bent opened the first Living in the Green Lane store in the Minneapolis-St. Paul area. Their concept, a home center for environmentally concerned consumers, has been very successful. Their core customers have been "green" consumers who are motivated either by environmental concerns or the economic savings available from green technologies (Schaefer 2007). These consumers tend to have higher levels of income, education, and home value than the general population of the United States (Kannan 2007).

In the past two years, the store has surpassed projected sales, established a solid base of customers (especially with its Living Green loyalty club, with almost 600 members), and achieved a reputation in the Minneapolis-St. Paul area as an innovative advocate of green building products and techniques.

To build on this success, Living in the Green Lane's owners plan to grow their business in two ways: by (1) increasing sales to current customers with the green lifestyle concept and (2) opening new stores to increase sales from new customers in the market area.

This SpatiaLAB focuses on the second of these growth strategies. Your challenge is to use enterprise sales data from Living Green loyalty club members to analyze sales patterns for the firm's first store, evaluate potential sites for two new stores, and recommend the best locations for those stores.

Location

Minneapolis-St. Paul core-based statistical area

Time to complete the lab

Four to six hours

Prerequisites

An understanding of the importance of using customer profile data in the site selection process for an existing retail enterprise

Access to Esri Business Analyst Desktop Premium 10

Data used in this lab

Demographic and consumer spending data at various levels of geography

Market Potential Index values from GfK Mediamark Research & Intelligence, LLC (GfK MRI), a leading market research group

Business listings for home center and shopping center data

About this Lab

Title: Site Selection with Enterprise Sales Data: Using customer data to select new sites

Author: Fred L. Miller

Level: 2, development

Requirements: Business Desktop Premium 10

Keywords: marketing; business GIS; business; trade area analysis; market area analysis; site selection; Huff model; principal components analysis; demographic; Tapestry segmentation

File: Bus_02g_SiteSelectEntSalesData.doc

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