Experimental Design Details
We propose to have a series of three short contests to coincide with and be named after the First Round, Sweet Sixteen, and Final Four. To make them even more like the NCAA championship, where the rounds are held over weekends, we plan limiting these contests to 3 or 4 days, not the whole week.
a. Contests dates
First Round (or First Round-Second Round): Thursday, March 16 to Sunday, March 19.
Sweet Sixteen (or Sweet Sixteen-Elite Eight): Thursday, March 23 to Sunday, March 26.
Final Four: Saturday April 1 to Monday, April 3.
b. Tournament rules
In each of the three contests, stores will compete in one-on-one matches similar to those in the March Madness bracket. However, there will be no eliminations. Stores will be matched to a different store each week.
There will be two “treatments” or types of contests. Half of the stores in the tournament will know the identity of their opponents. The other half will not know who their opponents are. In this way we can gauge the impact that knowing the identity of their opponents has on the effort of the stores.
Different from the NCAA March Madness, the results of one round of contests will have no impact on the following round nor on the prizes to be collected by the winners. Each week the winners of all matches get a monetary prize per sales associate.
c. Performance metric
The performance metric we are suggesting is percentage increase in number of transactions (tickets) with respect to the same period of the prior year. In the case of a tie, we will use the percentage growth in number of pair of shoes sold as a tie breaker. If the tie subsists there will be a coin toss to decide the winner, or a second tiebreaker measure.
The use of a growth metric has the advantage of facilitating comparisons across stores. Thus, a larger store could be competing with a smaller store, but it will still have to increase its effort by a amount similar to the small store to achieve the same performance. This helps to equalize the stores’ abilities across different sizes.
The number of transactions is related to and should be correlated with dollar sales and should focus the associates’ attention on closing the transaction, not so much on the number of items or the value of the items in the transaction. This could help with customer satisfaction if customers feel pressured to buy more or more expensive items. However, it has the disadvantage of being manipulable by the store associates who could, for example, transform a single sale of two items in two sales of one item. We could turn this disadvantage into a benefit because it will allow us to understand under what circumstances the store associates are more likely to manipulate this metric.
For the base period to calculate the percentage growth in number of sales transactions we will use the exact same tournament period in 2022. This means that for the First Round we will use Thursday, March 17 to Sunday, March 20, 2022; for the Sweet Sixteen: Thursday, March 24 to Sunday, March 27, 2022; and for the Final Four: Saturday, April 2 to Monday, April 4, 2022.