May 6, 2004, 12:00 AM

Tracking sales to their source: Manual works, but technology works better

It’s critical to use some kind of matchback method, Restoration Hardware finds. Correctly sourcing more sales to the right channel helps drive better spending decisions on the back end.

 

Many multi-channel retailers are using a percentage of sales formula to allocate sales to a channel when there’s no source code attached to the sale – but new technology is out there to do the job more accurately, Restoration Hardware director of direct marketing Linda Spellman told a panel audience at the Annual Catalog Conference in Chicago Wednesday.

“The important thing is to use some kind of matchback – it can make a big difference in terms of profitability,” Spellman says.

Spellman described two technology-based matchback methods, both of which Restoration Hardware has used, that allocate unsourced sales. Experian’s Channel Match product allocates unsourced tri-channel transactions by matching the name and address of customers to the retailer’s mail files; Abacus’s ChannelView offers similar service. Both products beat the percentage of sales allocation method in the dollar volume of unsourced sales they were able to match back, Spellman said. In one case, for example, the percentage of sales allocation method matched back $579,484 in unsourced sales to specific channels, while Channel View matched back $2,749,225 and Channel Match, $3,272,322, for a selected set of SKUs purchased in different channels.

“My goal is to limit the number of unknown sales as much as possible,” Spellman says. “By allocating as much as possible to a source code, it helps me make better decisions.”

 

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