Years ago as a young Chamber of Commerce director, I met with prospective business owners almost every week. Very often I heard “My aunt/mother/brother/uncle/cousin/friend said I should open a thrift store/restaurant/antiques store/boutique.” That was the extent of the research. They needed a location and a ribbon cutting and they were ready to go.
Even with my very limited amount of experience I knew we all needed more and better information.
Fast forward a few (okay, fifteen) years and the internet has brought us a world of information. Now the question is narrowing down that information and making it relative to our needs. The State of Mississippi in a quest to lure big businesses and support small ones has created a new website Y’all Business.
We spent some time perusing the information available this week and brainstorming about how this data could help your business as you create marketing and advertising plans, open new businesses or add products and services. If you’ll hang in there until the end, you can find out how many MILLIONS of dollars one county is losing in online and catalog sales every month and what that could mean for your business.
First, the bad news, it appears not all the features work exactly the way I’d want them to work. My understanding is that they are continuing to add information and turn on features. So maybe in the next few months, Mississippi businesses will be able to see where in the state the most people over the age of 45 live. Until then, we’ll work with the vast amount of information available.
Now on to the good news, even fifteen years ago Mississippi provided data about sales tax categories that many other states did not. With Y’all Business, the state offers even more information. If we take advantage of it, we’ll have a leg up on businesses in other states.
Rather than recap exactly what the Y’all Business site can do, we encourage you to watch the video on the front page of the site. It’s just two and a half minutes and will show you so many features of the site. After you finish the video, start by choosing the county where you want to find out about the residents. If you serve multiple counties, draw one out of a hat and start with it.
We’re using Lee County because that’s where Momentum Consulting is located, although we do and have served businesses from many counties throughout the state. My tendency is to just search for exactly what I’m looking to find. However, the search bar doesn’t appear to be working just yet. So, scroll to the bottom and start with the Community, Contacts, and Reports.
The Community tab gives you the basic demographics of the county. Useful, but not much more in depth than a general census report. It’s useful, however, to have this high-level overview available alongside the more in-depth knowledge so you don’t have to go anywhere else to find it.
At first glance, the Contact page offers just basic information, but keep scrolling and you’ll realize you have information for resources throughout the county including contact names, email addresses, and mailing addresses–ALL IN ONE PLACE. No more searching multiple sites. No more piecing together your own database. If you’re looking for contact information in several counties, this website has just saved you hours of time.
How does all this relate to marketing? Well, it doesn’t, exactly, yet. To get to the good stuff, you’ll have to register as a user on the site and click on the Reports tab.
Now, let’s dig into the data! If you aren’t geeking out with me over all the information you are about to encounter, it’s okay. I’m going to help you make it relate. The key is to think about your customer. What do they buy from you? What do you want to sell to them? Is there a market for it? Can you sell more? Should you add a product line? Let’s find out.
Depending on which report you choose to view, you’ll see differing information. The reports are divided into market potential, expenditures, and profiles. Not every category has every report. Because the retail sector has all three reports we have chosen to use those reports for our screenshots. You should choose the report that best represents your company.
Let’s look first at the Retail Market Potential.
You’ll download a pdf form like this:
We’ve drawn attention to the categories on the top. The Product/Consumer Behavior column is pretty self-explanatory. The Expected Number of Adults or Households is the number of people or households they expect made this purchase. The Percent of Adults/HHS is the percent of the total number of adults or households in the county who made this purchase.
The MPI is the least known or understood rating for most business people. It stands for Market Potential Index. This number measures likely demand for a product in an area in comparison to the rest of the country. A rating of 100 means people in the selected area (in this case Lee County) are as likely as anyone else in the United States to purchase this product. A rating of 80 means people in the area are 20% LESS likely to purchase the product. A rating of 120 would mean people are 20% MORE likely to purchase the product.
The Market Potential Report gives you some idea of the number of people who purchased a specific item and how likely they are to make a purchase of this item in relation to the rest of the country.
Are you still with me? Nod your head.
Let’s look specifically at one category: clothing.
Pretty close to half of the population has bought some type of men’s clothing and some type of women’s clothing in the last 12 months. At 99 and 100, people in Lee County are just as likely as anyone else in the country to buy men’s and women’s clothing. That’s good news if you’re a clothing retailer. If you look at the final line item, you’ll see that just under 11% of people in Lee County bought a watch in the last 12 months and they are 8% less likely to buy a watch than people in other parts of the country. If you are a retailer who also sells watches, you can look at this in a couple of ways: either advertise your watches more because almost 90% of people have watches that are at least a year old or advertise your watches less and promote fine jewelry more because consumers in this county are slightly more likely to buy fine jewelry. Whichever method you choose, make to measure your results.
Next, let’s look at the Retail Goods and Services Expenditures report:
The report itself looks slightly different from the Market Potential Report:
Although the first column has no title, it’s pretty easy to see it’s the category of expense. The Spending Potential Index is slightly different from the Market Potential Index discussed above. The SPI rates how much people in the area are likely to spend on a product compared to other people across the United States. Again, 100 is considered average. If people in the area have an SPI of 80 they typically spend 20% LESS than the average consumer across the country. An SPI of 120 means they spend 20% MORE on this product than average.
The third column gives us the average spending per household in this category and finally the total amount spent by people in the area in this category.
Let’s look again at apparel and services.
While people in Lee County were just as likely as others across the country to buy men’s and women’s apparel, they will not pay as much for it. Not surprisingly, the average spent on women’s clothing is almost double that of men’s clothing, although women in the county still aren’t paying as much as others around the country.
We did a quick comparison with Desoto County.
Look at the difference in spending. If you are interested in opening a clothing store, this information gives you insight into your pricing strategy and advertising price compared to your competitors in other counties.
Finally, let’s look at the Retail Marketplace Profile:
Here’s the snapshot of this report:
The industry groups are put together slightly differently so it’s not entirely an apples to apples comparison to the other two reports. The NAICS is just the business code for businesses in that classification. The demand tells us how many dollars could potentially be spent by consumers in this area on this product. Supply tells us how much was actually spent. The retail gap tells us how much more or less has been spent than was in demand. The red numbers mean there’s more being spent than we had actual demand for. The surplus/leakage report puts those numbers into percentages. And finally, you have a count of the total number of businesses in that category.
We’ll pull again from the apparel listing:
Lee County has sold over 35% more clothing than it had demand for within the county. These sales likely came from outside the county which is something economic developers in the area have touted for many years. Although residents of Lee County certainly go outside the county to shop, the county makes up enough in sales to people outside the county to make up the difference plus some. What does this information mean for your retail boutique? You cannot advertise and market only to people within Lee county and think you’ve got it covered. With 35% of sales in this category coming in from outside the county, you need to create a plan to capture these consumers when they come in to shop.
What about categories where there’s leakage? The biggest category in retail that’s leaking outside the county is in online and catalog sales.
Lee County residents spend just over $68 million dollars with online stores and mail order houses. One-hundred percent of these dollars went to businesses outside the county. These businesses are companies with no brick and mortar store but sell only through a catalog or an online site. This category does not include apparel only. Across the board residents of this county are buying online. YOUR customers are buying online. This presents an amazing opportunity for you to expand your business.
Thank you for sticking with me through this walk-through. As you can see, our Secretary of State has given us an invaluable tool. Do some digging into the report that pertains to your business. We have no excuse to fly blind here. Find out where your business can expand services or products. Use this information to choose wisely what you advertise and where you advertise.
Do you need some help setting up online retailing, marketing your online store or reaching your customers who are searching online for your products? We can help.