Stitch Labs on Color Names And Revenue
By SBO Editor
April 23, 2014 Small Business Opportunities
Labs, an industry leader in cloud-based inventory control and business management solutions, just announced key findings indicating revenue differentiations as a result of color names alone. Mined from retail sales data of more than one million orders spanning tens of thousands of businesses, Stitch Labs found that not all products boasting creative color names experience increased revenue.
The Stitch Labs data
The Stitch Labs data reveals where businesses can test getting creative with color names. Key findings include:
Classic Color Names Reign Supreme
Red color families generate up to 28 percent higher revenue with standard names versus creative equivalents, such as strawberry, raspberry or cherry. Because this classic color name performs better, businesses can save time and creative resources by sticking with tradition.
Creativity Can Pay Off
From the data, colors in the purple family generated up to 31 percent higher revenue when creatively named. As businesses focus their creative efforts, it could be advantageous to focus creative efforts in purple families.
Brown, pink, and yellow products showed minimal increase in revenue generation. Chocolate was found to bring in almost the same revenue as brown. In this example, a company selling “brown boots” may experiment with calling them “chocolate boots” for brand purposes. However, the point here is that testing is crucial to make sure each individual business is attributing profitable descriptors to their products. A large clothing business may not want to allocate resources and time in these color families based on the return.
“Because these seemingly small decisions, like color naming, have such a large impact on overall sales, it’s important that businesses are implementing technology that tracks and analyzes their individual sales data,” said Stitch Labs’ CEO and founder, Brandon Levey. “You may think that choosing ‘midnight’ over ‘black’ is a fun way to express your brand, but if you knew it would tank sales, would you risk it? We’re not advising businesses on what they should do necessarily, we just want to shed light on the importance of data and how businesses can use it to make more informed decisions.”
Data used for analysis were based on orders synced with Stitch Labs from January 1, 2013 to December 31, 2013. This data set was pulled from more than one million orders, totaling $50 million from tens of thousands of different businesses. Each product in this analysis had one product variant of color that contained the descriptions mentioned in this release. Here, typical represents the median average unit price when comparing data across all businesses with multiple orders for each option.Source: http://www.sbomag.com/2014/04/stitch-labs-on-color-names-and-revenue/