Retailers may become frustrated with their people counting system when they are not able to access information about their conversion rates or analyze a change in that data. And retailers who have not yet implemented a people counting system may be skeptical of its effectiveness for that same reason. Both groups have failed to recognize the full potential of a people counting system – keep reading to find out why.
If you can relate to either of those statements then it is important to remember: The amount of conversions made and the amount of foot traffic gained are related, but not the same.
Foot traffic and conversion rates are two separate sets of data, both useful in their own way. Allow us to explain. While a people counting system cannot provide information about your brick and mortar store’s conversion rate, it can help you calculate it yourself – and gain a more accurate understanding of your store’s performance.
So what’s the difference between the two?
Your conversion rate is the relationship between the number of visitors and the number of purchases in a store, or in other words: the number of people who actually made purchases divided by the total amount of people who enter your store. Your traffic count is simply the amount of people who entered your store during a given period.
How can I calculate my conversion rate using a people counting system?
Therefore, traffic counts can be used (in conjunction with sales history generated from your point of sale software) to determine your conversion rate. A people counting system is meant to supplement your point of sale system, not replace it.
While point of sale systems can only provide information about the customers who made purchases, people counts are powerful metrics that allow retailers to learn how many customers are exiting their store without making purchases. This helps them analyze their both their inventory and their business strategy and, over time, strengthen the relationship between their visitors and their sales.
How can I use a people counting system to improve my conversion rate?
The foot traffic data generated from your people counting system can be used to calculate conversion rates for number of shoppers, seasonal traffic patterns, impact of events and differences between regions or groups, in order to better understand how your store is performing and how to positively impact sales. Your foot traffic counts obtained from your people counting system can answer the following questions.
During which time periods does your store have the most visitors? Which periods have the least? This will allow you to know when you have the most opportunities to convert shoppers to customers.
Did you experience or decrease an increase in traffic after making changes to your schedule, hours of operation, inventory or prices? Using this data, you can gain an understanding of whether or not are your customers satisfied with your current customer service offerings, item selection or prices. Improving what shoppers are dissatisfied with will most likely inspire more conversions.
Besides… what’s so great about conversion rates anyway?
Your conversion rates are not the be-all end-all of your store data. Just because a person does not make a purchase, does not mean they are not interested in making one in a future visit. In many cases, they are browsing, window shopping, gathering information or even trying clothes on. You never know – perhaps the item they are interested in will have to wait until their next paycheck. You don’t want your customers to make a hasty impulse purchase that they are going to regret.
By improving your service and marketing overall, you can increase the chance of them returning to make a purchase.