Retail Analytics Solutions
4 Reasons Why Retail Analytics Solutions Are Essential
Some technologies collect data from retail stores and extract important analytics from them. These analytics are the statistical representations of what goes on in the store. And they vary from the simple—like the number of visitors received per hour—to the more complex, like the store’s cart abandonment rate. Analytics provide retailers with information about their stores and the customers that patronize them.
It also gives them insight into how customers interact with the store and how the interactions affect store traffic, sales, and overall business performance. In the past, some of these analytics were obtained manually. However, the process is far from accurate, and only a few metrics can be measured. Furthermore, supermarkets, shopping malls, and retail chains are typically large and receive sizable traffic. Therefore, they cannot collect and analyze data manually.
Retail analytics solutions digitize and simplify the data collection and analysis process. In the end, they provide retailers with analytics that can be used to improve operations and boost profits. Here are four other reasons why these solutions are essential to retailers:
1. Footfall analytics can be used to track store traffic
Retail footfall analytics offers insight into visitor’s activities in a store. It can be used to track how many people visited, the demographics of the visitors, and what percentage of visitors made purchases (conversion rate). Footfall analytics can also be used to benchmark performance among stores in a chain and measure how traffic changes with time.
For a retailer, these insights are very valuable. If you can figure out the prevalent demographic of your visitors, you can optimize product procurement/listing. Say you manage a drugstore, and footfall analytics show that a majority of your visitors are women 55 years and older. Filling your shelves with the products and brands that appeal to this group is sure to increase engagement and sales.
Additionally, with footfall analytics, you can see how well your store is attracting visitors. You can also measure your conversion rate. If you run a chain of stores, you may compare the performance of individual stores and repeat strategies that work across all the stores.
Without analytics solutions, retailers cannot access these insights. Neither can they improve operations to maximize visitor traffic.
2. Analytics software can be used to generate digital footprints
Online stores are well placed to generate the digital footprints of their customers. They can easily monitor shoppers’ actions and see what section of the site they visited, which products they clicked on, and on which pages they spent the most time. By following these breadcrumbs, they can identify customer preferences and leverage them.
With retail analytics software, physical stores can generate digital footprints, giving them a fighting chance against the onslaught of e-commerce stores. Heatmap analytics shows you which sections of your store receive the most traffic, the products your customers engage with the most, and in which areas they spend the most time. Consequently, you, too, can leverage the information and optimize accordingly.
3. Retail behavior analytics provides insight into customer behavior
Retail behavior analytics offers insight into customers’ actions, and sometimes, it explains why they behave the way they do. For example, you can track how many of your customers abandoned their shopping and why. You can also identify which times/days your customers are likeliest to visit your store. If you have active marketing campaigns, behavior analytics allows you pinpoint which of them your customers respond to.
Understanding why customers abandoned their shopping can help retailers reduce lost sales opportunities. Identifying their busiest hours/days can help them optimize staffing and make the most of the increased traffic. And figuring out which marketing campaigns work helps them save money and reach a bigger audience.
4. Store analytics can be used to measure business performance
Every business owner/manager knows how important it is to measure performance. It is the only way to measure progress, benchmark against past performance, and figure out areas that need improvement. Retail store analytics focuses on some indicators, offering an effective way to keep track of business performance.
For a retail store, the most critical performance indicators are foot traffic, completed sales, conversion rate, customer retention rate, cart abandonment rate, customer-to-staff ratio, and capture rate. With retail store analytics, you can measure your store’s performance based on each indicator. You can also see how the performances change over time.
Optimizing just one of these indicators will have a direct impact on store revenue and profits. And access to analytics means that you can implement plans to improve any or all of them. After some time, you can check the analytics to confirm that the programs are working and evaluate their effectiveness.
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