Retail Store Traffic Analysis For Your Store
Sophisticated customer relationship management tools have become prevalent in the industry, allowing the retailer to track virtually every “touch” of the customer’s experience with your store. But what do you know about customers who have not yet visited your kiosk? Or what about those that have given a salesperson their contact information? Do you know how much retail store traffic you have received, or how many potential customers have visited your retail locations last month? Last week? Two hours ago?
In order to answer these important questions, many businesses are employing electronic systems to count customer traffic and using this information in context of other business metrics. Some of the more comprehensive counting systems can also tie in with a company’s server network and show traffic by hour, location and individual entrances.
Read the full article or jump to a specific section:
- What Traffic Data Can Provide Decision Makers
- The Technology Behind Traffic Counting Systems
- Use People Counting Data To Increase Profits
Ready to get a people counting device and start collecting traffic data? Contact Traf-Sys today and get a free quote to get your system installed!
What Traffic Data Can Provide Decision Makers
Many retailers are now using traffic flow analysis in retail management to look at the distribution of traffic by hour, day of the week, store location, seasonal periods, promotion periods, total chain, etc. Retailers can also look at the conversion ratio of their store which is the total sales transactions divided by total traffic. Different retail segments can have vastly different conversion ratios. For some businesses, 30 percent conversion rate is considered fantastic while for others this figure would be dismal! Retail stores will also be able to measure traffic based on current promotions and advertising. You will be able to determine if your conversions went up, down or remained the same during the promotion.
With traffic counting, retailers will be able to optimize their staffing. Retailers traditionally staff their stores according to historical and forecasted sales. Unfortunately, this does not account for potential opportunities that may have visited the store but did not buy. Traffic information can inform you of these factors.
Tracking traffic flow in retail allows retailers to deploy initiatives that increase the likelihood of conversion and analyze what staffing strategies are best for each store or store group.
While the business applications for in-store traffic data is nearly limitless, here are just a few more ways retailers can do more with the data collected:
- Identify Prime Real Estate: Once installed, some retailers conduct what is known as A/B testing with our people counting systems. A/B testing pits two options against one another and uses data to determine the winning candidate. You can use this process to further identify which displays perform the best and result in the most sales.
- Tweak Your Store Layout: It’s your job to guide customers through your space and to entice them to linger and ultimately to buy. The main function of the flow and design of your store is to maximize sales for each square foot of space. Real-time insight into traffic allows you to tweak and refine the layout until you have the optimal layout.
- Boost Traffic: Ideally once you know your baseline traffic numbers on a daily, weekly, monthly and annual basis, you want to start identifying opportunities for improvement and brainstorming ideas to boost traffic. Time contingent promotions (like door busters) drive customers into your store during off hours. Special events can be strategically scheduled during lulls as well.
- Prevent Theft: Retail traffic counters aid in determining the ideal shopper-to-associate staffing ratio, which is beneficial not only to providing customer service but also to keeping an eye on individuals in your store who may have unsavory intentions. Retail thieves often strike during busy times when staff may be occupied with assisting shoppers.
The Technology Behind Traffic Counting Systems
Common retail traffic counting systems use sensors at the entrance areas to count the number of visitors to the store. Infrared technology is used to register customers coming in or going out of the store by counting each time a beam is broken. Some of the more sophisticated systems can even determine a customer’s actual direction of travel; whether they are coming in or going out. These systems are usually based on thermal imaging, which is body heat detection or video processing technology. Sensors can be mounted horizontally at the entrance, or overhead above the customers’ path.
Counts can be generated using the system and sent to a database. Depending on the system that the company is using, counts can be segmented virtually in real-time or divided into time increments such as five minutes, half-hour, hour, etc. Some software systems will allow reports to be generated by time period, store site, entrances, and segmentation groupings.
Use People Counting Data To Increase Profits
Now that you know how the technology works and what the reports from traffic counting will show you, let’s talk about what counting can do for your profits. Since revenue and repeat customers is what keeps you in business, this step is very important.
Once a company begins counting traffic, they will immediately discover new ways to analyze and optimize their business. For example, the retailer will often start with benchmarking its current conversion rates and track future conversion as the company implements best practices to improve on conversion. Even the smallest percent increase can be a significant difference for a company. By utilizing traffic counting systems, companies can also determine if they are understaffed during peak traffic times or if they are losing sales or paying too much for labor during inopportune times.
Traffic counting systems can also inform a company if certain advertising efforts are warranted or not. Combining traffic information with sales and transaction data, assessments can be made to show how to make different areas of your business such as marketing, staffing levels and support more effective.
With a relatively small investment and a little bit of time, retailers can positively impact their profits by analyzing visitor traffic.
Want to learn more about traffic counting? Contact our team of experts or request a quote.