Today retailers look at a minimum of 6-12 months of sales numbers before deciding whether to keep a store in operation or close down. As Instapio, we are working hard to deliver the power of analytics to help retailers understand the changing patterns in different metrics to predict store performance before sales start going down.
Instapio partners work with retail companies across the world to deliver these numbers that can be segmentified to predict performance without needing confirmation from sales figures, saving them money and time. Let’s focus on which metrics are most popular among retailers to predict these trends.
Store Acquisition Rates
Many major retailers have door counters or camera systems that loosely count the number of people going in and out the store. However, the number of people going into the store doesn’t always have the best correlation of what is going on outside. Retailers spend a lot of money for shopping malls and pedestrian streets with high shopper presence. By understanding the crowdedness of store fronts and the behavior of the street traffic, retailers can easily predict how their walk in numbers will reflect on in-store conversion. Understanding the changes presents and opportunity for the retailer to fix the problems before deciding to close a store. If the customer acquisition problem is because of the location of the store, contracts may be renegotiated or the store can be moved to a better location. If not, the problem is internal so the retailer looks at merchandising, store front design, employee behavior and other opportunities.
Customer Acquisition and Retention Rates
Although sales is the ultimate goal of any retailers, understanding how many potential customers they are acquiring and maintaining is more critical in estimating the sales numbers of the particular store. For many retailers, the acquisition of new customers into stores is as important their loyal customers in bringing new streams of revenue.
Cannibalism across the Chain
Visualizing cannibalism data helps retailers understand which stores within their chain are eating customers from other stores in the chain. One of the largest sources of customer visit decreases for retailers is the loss of business to other branches within the chain. Retailers who can measure the move between their stores and take action accordingly by consolidating or optimizing the stores can make huge investments and allocate resources in the right direction.
Measuring customers in and out of the store is powerful yet another tool to understand the changing trends is their interest within the store. Particularly for stores with different sections and categories, it’s vital to understand which areas customers are interest in and carry out merchandising and promotional efforts accordingly.
Retailers need to be aware of the environment inside as well as outside their stores. By leveraging the power of the data that can be easily gathered from their stores, they can make agile decisions and get ahead without losing precious time and financial resources.