Measuring Customer Behaviour to Improve Sales

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Business is slow. But as far as you can tell, nothing has changed. You’re doing everything as you always have done, and yet fewer people are coming to your store. And those that do, are spending less money.

And that’s a problem.

But what’s the cause?

Is it your product? Is it no longer required? Has the quality gone down? Is it not innovative enough? Too expensive? Too cheap?

Could it be your staff? Are they slacking off? Are they not as helpful or friendly as they should be?

Are your marketing messages resonating? Is your window display original enough to make people stop? Are you offering enough promotional items? Are people interested in what you’re promoting?

The problem is you’re not sure, which means you can’t even begin to fix it.

If only there was an easy way to find out from your customers themselves.

But there is! And it’s not expensive to implement, or difficult to use. In-store analytics tools allow you to monitor customer behaviour across a wide range of metrics, providing you with the valuable insight you need to make data-driven decisions.

Here are five of the most important behaviours for a physical retailer to measure:

 

Bounce Rate

Bounce rate is the number of potential customers who enter your shop and then leave without spending any money. It usually happens within a few minutes – they stroll in, do a quick circuit and head quickly for the exit.

Ouch.

Once a potential customer has crossed your store’s threshold, it’s down to you to ensure they find what they’re looking for. To discover if this is an issue, measure your bounce rate on a daily basis to identify a baseline and any weekly trends. Once you know the number of people entering your store, it’s pretty easy to work out the percentage who bounced by looking at the number of transactions that day. It’s simple to calculate, and it gives you a metric that you and your staff can measure against on a day-to-day basis to improve conversion rates.

So, if your bounce rate is high, what is the problem? The first thing to look at is whether the bounce rate goes up when you have less staff on the shop floor. Customers don’t want to be smothered when they walk in the door, but it’s nice to be acknowledged.  Too few staff, no acknowledgement, and no help when it’s required could be a likely reason for a customer to leave without buying a thing.

Being short staffed can also mean the store gets untidy throughout the day, and there’s nothing that will make a customer retreat more quickly than a messy shop floor.

 

When are you busiest?

Do you know the answer? So often we find that the data tells a different story than managers’ report anecdotally, and it brings us back to the previous topic – staffing.

You may think it’s busy when you’re on the shop floor, but is it possible you were just under-staffed? Or when it feels calm and manageable, were you over-staffed? Analytics tools can help you identify exactly what is needed on the shop-floor, and when. It goes far beyond historical sales figures, which only tells you what you managed to achieve under any given set of circumstances. You need to know when there is potential to do better, and a robust staff scheduling tool that draws data from your people counting hardware along with other useful sources can do just that.

The result? You provide a better service when there is an opportunity in the store to sell more, and you save money by not wasting staff hours when they’re not needed.

 

Mapping customer movement

Video or WiFi based people counters can map exactly how customers move through your store once they have entered.

Nifty.

And useful. Understanding which aisles and displays attract customers – and perhaps more importantly, which ones they stay away from – gives you an opportunity to analyse their behaviour. Is the area poorly lit? Is it cramped? Could you widen high-traffic aisles to allow more customers to be there at any one time? And of course, when you know the route that most customers take you can optimise your promotional displays by placing them strategically in their path.

 

Walk on by…

When you initially installed your people counting hardware your aim was likely straightforward – to count how many people enter your store. But is your current system able to measure how many people don’t? Every person who walks past your store is a missed opportunity, but most retailers can do little to nothing about it.

Area managers often tell us they hear a familiar grumble from failing stores, ‘But the location is terrible, there’s not enough passing traffic!’. It’s so hard to disprove this is the case, and much easier to accept the anecdotal evidence and chalk it up to a lesson learnt.

But don’t give up just yet!

More sophisticated WiFi systems can count passing traffic accurately and unobtrusively, and can immediately tell you if the problem is with the location, or with something else. If the traffic is there, but it’s not translating into footfall in the store you need to look at your wider marketing strategy – the high street has never been more competitive, so you need to stand out. How successful you are at getting passers-by into the store reflects how well you’re doing this. Does your new window display improve the data? Do creative visuals have more impact or are people attracted to discounts and promotions? These are all things you can learn quickly with the right kind of data in your hands.

 

Who comes back?

Keeping loyal customers happy is just as important as attracting new ones; but how do you know you are getting the balance right? WiFi-based people counters recognise returning customers, telling you the percentage of your sales that comes from returning shoppers.

Returning customers are an easy win because you don’t have to spend as much to bring them back to the store, and when they do come back, they tend to spend more.

Returning customers are like old friends. They like you. They want your stuff already. They know they’re not taking a chance and are happy to pay for the experience they have in your store. But what if you could take that experience and elevate it to go beyond their expectations? What if your staff were made aware as soon as a returning customer walked in so they could greet them with a familiar ‘Welcome back!’?

As unbelievable as it sounds, there are systems that can do that. But measuring the number of returning customers could just be indicative of the value a loyalty scheme would offer you, or simply a change required to your marketing strategy in general – put simply, are you making enough effort to reward loyalty and is it showing in the data? It’s proven that loyalty rewards result in higher customer spend. Plus, loyal customers are the ones most likely to mention the stellar service they received to their friends and family, resulting in more custom walking through your door. So it’s a behaviour that’s well worth tracking.

 

How can this work for you?

If you’re interested in seeing how Ikea, Clarks, River Island and Monsoon are using smart technology to increase sales by 10% and decrease costs by 12%, then schedule a free 1:1 strategy session with one of our Retail Customer Experience experts. In just 30-minutes we’ll show you exactly what tools they are using, and demonstrate how you can get the same results for your stores.

Book a 1:1 session

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