Lapperre has been the reference in hearing solutions for more than 65 years. They are part of Sonova Retail Belgium, which belongs to the Swiss Sonova Group, the world’s largest provider of hearing solutions. Lapperre has more than 80 of its own hearing centers in BeLux and over 170 points of sale across the country. “In places where the potential is more limited, we work together with partners, such as opticians. This allows us to offer more flexible opening hours and it is cost-saving.” In 2016, the Sonova Group also acquired their competitor Audionova. In total, this brings the group to around 260 points of sale in Belgium and Luxembourg.
“In the past, choosing a new location was done based on gut feeling. Now, we decide on new locations in a structured way. We discovered that about seven parameters are decisive for us when opening new locations. And thanks to the high accuracy of the models, decisions are made in a well-founded way and emotional discussions are a thing of the past.”
“In the past, choosing a new location was done based on gut feeling. Now we decide on new locations in a structured way.”
“A hearing aid is not an impulse purchase, so we don’t need to be in a AAA location. On top of that, our customers want to be able to enter a store discreetly, because there is still a stigma attached to wearing a hearing aid. It is important that our locations are easy to reach, either by car or by public transport. Ideally, the premises are also in a quiet location. But we also take into account the locations of doctors, ENT specialists and care homes. Those are our perfect neighbours.”
The collaboration with RetailSonar goes very far. Over the years, a hotspot analysis was carried out in which optimization models calculate the optimal network of the future. This allows Lapperre to detect the most ideal locations in Belgium down to address level.
“The journey to finding the ideal location is even more important than finding the ideal location itself. I really enjoy the phase where we set up the model. Defining the parameters, determining causality and applying sensitivity. After that, we always perform a hotspot analysis, which should answer the question: ‘Where can we still open a new location that can generate sufficient turnover?’ This way we can work quickly, proactively and strategically.”
“Every year, we evaluate new parameters and check whether this further improves accuracy.”
“But even then we’re not resting on our laurels. We continuously interpret the results and compare them with the real figures in order to optimize the model. At the moment, we have an accuracy of 84% for the entire national market. Every year we evaluate new parameters and look at whether accuracy improves. Over the past years we have tested many things and noticed that some factors have no impact.”
“It is very important for us to be able to do that thinking exercise together with RetailSonar. We are both learning organizations, and RetailSonar is absolutely the right partner for us in this process. In the last three years, we opened eight new hearing centers. All eight performed well, but six of the stores outperformed. Our data has become so much better in recent years. We keep comparing the results to the model every time, so that all our decisions are evidence based.”
This process is repeated every year: “Where are the best hotspots now? What is the theoretical performance of each point of sale?”
But it doesn’t stop there. Dirk Schaele also uses the RetailSonar platform to benchmark different stores. “The extremes in the sales figures have been leveling off in recent years. Four weeks after the start of the new financial year, we already get the first indications of which hearing centers will struggle to achieve their targets. Many factors play a role here. Sometimes it is a structural problem, sometimes a sales issue, or sometimes we need to look at occupancy levels instead.”
To structurally determine the cause, Lapperre uses an eight-step plan: “We always start with a check of the RetailSonar geo-parameters by the local teams: are there roadworks nearby, or new competitors? Have any doctors moved or retired? Then follow parameters such as sales performance and staff planning. We also check whether there is perhaps a capacity issue. That is why we simulate our capacity in a mathematical model, because we want to be sure we can serve our customers. If there is a sales problem, we send staff to an additional sales training. Only when all these influencing factors are under control do we move on to a local marketing campaign.”
What do you do when two competitors suddenly become part of the same group? In many countries the two groups complement each other, but in Belgium, for example, there are already two strong brands. That is the situation for Lapperre and Audionova, both references in the field of hearing solutions. It was decided to let both brands continue side by side. This makes the search for the ideal location for a hearing center even more difficult, because now more than ever you have to take into account cannibalization within your own network.
“Our colleagues are impressed by the strategic and systematic way in which we approach our location search.”
“We started by repeating the entire process from scratch for Audionova. We mapped out locations, catchment areas, turnover and influencing parameters. Then we analyzed where the big differences and similarities between both brands lie. Where are the hotspots for each brand? Where are we in each other’s way? Where can both still grow?” In this way, they defined ten new locations with as little cannibalization as possible.
“The collaboration with RetailSonar is very beneficial for Lapperre. Our colleagues are impressed by the strategic and systematic way we approach the entire process. It is very good for our internal image. (laughs) Our new ‘concu-colleagues’ were therefore quickly convinced to start using the RetailSonar platform as well.”
Why did he choose to work with a start-up in 2012? “I was already working with RetailSonar (Geo Intelligence, editor’s note) when I was still at Mobistar (now Orange). For me, it was obvious to bring them in at Lapperre as well. Big data wasn’t that ‘big’ in 2012 yet. At RetailSonar, data is handled correctly and they are not just riding the wave of a hype, as so many data companies do now. They did pioneering work, and for us it was interesting to be part of that.”
“At RetailSonar, data is handled correctly and they are not just surfing a hype, as so many data companies do nowadays.”
“The advantage of a young, dynamic team is that you can grow together during the start-up phase. That’s why I see our collaboration more as a partnership. On top of that, thanks to their close cooperation with the university, they always have ‘fresh’ academic knowledge and well-trained data scientists.”
The close collaboration with RetailSonar is extremely important to me. In retail, generally speaking, far too little is still being done with the available data. Data is not always collected correctly and the quality and analysis still often leave much to be desired. To survive in the long term as a retailer, it is important to start a discovery trajectory as soon as possible and to assign someone dedicated to data collection and analysis. This is an interactive change process, so you are better off starting today rather than tomorrow.