Why are in-store retail analytics important to retail performance?
The importance of data and analytics isn’t a new concept but for high street retail stores, the amount of data available has always been limited compared to online competitors. However, with the growth of in-store retail analytics, businesses can finally monitor retail performance in a range of new ways. Businesses can also make informed decisions around a number of important metrics using the data.
Understanding customer behaviour
There’s no doubt that getting the best from every customer involves understanding their behaviour and offering the best experience on every visit. The major benefit of in-store retail analytics is that businesses can gain a better understanding of customer behaviour and therefore a clearer picture of what they want from their visit.
One example is the ability to see shopper’s reactions when they look at an item or even when they first enter the store. If their first expression when walking into the store is one of confusion, then there’s a good chance that the store layout is confusing and they are unsure where to find what they want.
Retail analytics and the ability to monitor retail performance in new ways allows for increased sales as the store can better understand what their customers want and need and make recommendations based on this.
Great customer experience
For example, analytics can be used to monitor how long a shopper has been in the store and the time of day. Say it is lunch time and they have been shopping for 45 minutes. Retail analytics having collected data from them on a previous visit means the business can send them a text with a voucher for the restaurant. This makes them feel cared for and special and also increase the value of that customer.
Or maybe the software registers a client has spent time examining a product but didn’t make the purchase. A well-timed text voucher offering a slight discount on the product or a multi-buy offer might be the way to tip them back to the item and into making the purchase.
The effects of a poor experience
One of the primary reasons that retail stores need to use in-store analytics is to ensure they are offering the best possible service to their customers. This ranges from areas such as the amount of staff on hand to help with the stock levels on the shelves but also covers areas such as the location of items in the store.
The facts show why this is important: 68% of shoppers will leave a store if they have a bad experience while there and nearly 40% of these shoppers would then consider permanently shopping elsewhere. Over 80% of them would tell others about the bad experience and these days, this means social media.
Using analytics allows businesses to see what works and what doesn’t in real time within the store and make amendments that mean the customer receives a better experience. And therefore, the chances of that poor customer experience are much reduced.
Creating brand loyalty
Brand loyalty has been on the decline in recent years as shoppers get used to going online, finding the cheapest price and taking little notice of who they are buying from. As few as 5% say they are loyal to a particular brand for any particular area of their shopping.
However, the use of analytics can help to reverse this trend. Surveys show that many people still prefer to do their shopping in physical stores for everything from food to big ticket items and a large part of this is the ability to buy from other people. Stores can use retail analytics to better manage their staffing levels to ensure those people are available when needed and help create that brand loyalty.
The same loyalty can also move on a step to become brand ambassadors, the kind of people who share experiences, products and user generated content with the online world because they are so impressed with the store. This is an invaluable resource that has led to the rise of influencers, people with loyal social media followings who recommend products or services that they have been impressed with. And these recommendations are just as liable to be a physical store as an online one.
The aim of all businesses is to maximise their profits and to increase the value of every customer. By using the various tools within a good in-store retail analytics system, it is possible to offer the best experience for every customer. With the use of cleverly placed discounting and loyalty schemes, the potential value of each customer can be increased. And the high standard of service offered means that customers are more likely to tell a positive account of their visit to the store and spread work around their network, encouraging others to try the store themselves.