In-store Metrics and Why They Matter
Posted: November 04, 2014
Lots of people throw around terms like ‘key indicators’ and ‘metrics,’ but what do they mean to physical stores?
Online retail sites have all kinds of ways to measure consumer traffic, what’s in a shopper’s cart, dwell time spent on a particular product or page, etc. That’s why measuring online success or inadequacies has been so popular and accurate.
Brick-and-mortar sales account for about 90% of all retail sales. While the other 10% belong to online sales, that percentage is growing. Brick-and-mortar can still use passive shopper behavior to gain valuable insights into how to improve their in-store experience and bottom line. The same methods of measuring shopper engagement online can be used in the store.
Stores can also measure things like how long a shopper stays in a department, referring departments and capture rates from street to store. These same metrics can also be used to measure shopper intent, which is the first place a consumer stops in the store. Data points collected from the route a customer takes, dwell and first-stop behaviors can detect showroom activity. By using all this information to identify products, categories and departments that show this activity most often, retailers can take actions to convert shoppers into buyers.
But it goes beyond that: If there is no increase in sales, is that because the in-store experience was unfulfilled, or was it caused by lack of traffic in the store? Hence, the reason for measuring vital patterns and statistic.
While apps can precisely gauge shopper intent, consumer adoption of apps is still very low, in the scheme of things. Measuring with passive data across the store gives retailers a broader view of shopper behavior and allows them to make informed decisions that will have the greatest impact to their business.
The importance of these in-store analytics can’t be overstated. The success of marketing campaigns can be judged based on store traffic and sales conversion it generates. In this way, brand effectiveness, multi-channel loyalty, and shop time can be measured and incorporated back into retail marketing strategy.
Metrics can also be a valuable way to measure merchandising and product placement in understanding where and how the conversion to buy takes place, and how successful specific promotions are. Video tracking can additionally help with display compliance, since manufacturers often complain that non-compliance can be as high as 50% for retailers.
By being able to identify traffic patterns in store, staff allocation can be better managed and balanced to identify ratio of staff to shoppers, and checkout locations can be appropriately tracked to see if additional help is needed.
Video surveillance can be augmented with store metrics to measure behavior and automatically monitor suspicious activity. Stores can isolate these uncharacteristic activities and use the video as documentation.
Mannequins and heat map sensors in ceilings and floors, which track foot traffic; smart displays which can be incorporated into interactive signage measuring length of time a shopper looked at a product, as well as age and gender; and spy cams which can be placed in a variety of spots, can all provide important information retailers need for strategy and merchandising.
If these measures are deal-breakers because of cost, there are other low-tech ways to get results. Store staff can perform manual head counts in key spots and can conduct random sampling in different departments. Security cameras can be set to systematically capture timed photos to track foot traffic.
Retailers can use apps like Four Square and Side Kick to track consumer response to specific promotions and whether shoppers checked in at specific store locations.
Whatever measurement strategy is used, Main Street can apply those hard-learned lessons from ecommerce to fast-track their retail operations to the fullest.TAGS: retail, retail trends, retailers,