How to Get the Most Out of Retail Analytics and Data
Sir Francis Bacon said it first — knowledge is power. But knowledge alone isn’t always enough, as is the case with retail analytics.
It’s a scenario we hear about a lot. A retailer or manufacturer goes to the trouble of collecting retail analytics and data. The numbers come in with all the information. What next? The data sits there on a shelf (or a hard drive) collecting dust because no one has the time to delve into the numbers.
Obviously, this isn’t ideal and can be a waste of time and money. But what’s the solution — no more retail analytics? We say not. Rather, the answer is in how you take the data and use it as a tool to build sales.
Relying on data can take the guesswork out of your brand, enabling you to make smarter decisions, improve the customer experience and customer retention, and make higher profits. Understanding how your brand is doing in-store will help you make more informed choices and stand out from the competition. The way we see it, it’s win-win. But if you’re not digging into your analytics or are unsure how to use the data you derive, here are some tips that may help.
- Use sales reports to predict what products or suppliers are driving revenue.
If the analytics show that a particular product or category is doing well, or a particular product line or item is driving sales, it may make sense to focus on what’s working. Either stock similar or complementary products, offer more of your supplies to the stores where it’s doing well, or increase stock.
Conversely, you can also look at what isn’t working. If the analytics show a particular product isn’t doing well, you may want to audit the physical inventory levels at store. Many times, the auto-replenishment systems are set to a minimum number of items in-store. If your inventory is incorrect in the system this will stop the auto-replenishment process. This is a key issue in the store as “phantom inventory” becomes a larger problem.
- Use foot traffic data to see what parts of the store customers are visiting.
A store’s foot traffic flow can help you understand how your brand is placed. Seeing what parts of the store customers are visiting can tell you if your brand presentation and placement is working for you. Is there a certain area of the store that is drawing more traffic and generating more sales? Or is there a part of the store that might as well be retail Siberia? Or maybe customers consistently stop at a display, yet don’t buy anything. This is all information that can only be gleaned by watching, but it could make a big difference to your bottom line.
- Combine e-commerce and in-store data to predict customer purchases.
Studies show that many consumers look at products online before deciding to purchase. If your brand is on an e-commerce site and at an in-store location, you can use that data to know what a customer is going to purchase before they even come into the store. You can also see what similar products consumers are looking at online. If certain products are consistently being reviewed together, it may make sense to place them close together in-store.
E-commerce analytics can even go a step further to predict future consumer behaviour. For instance, if a new mother is shopping for baby formula and diapers, it stands to reason that in a few months she’ll be shopping for toddler clothes, toys, and books. You could use this in your online advertising to drive even more sales.
- Use market analysis to see how your prices compare to the competition.
Some of the most valuable data a retail audit can collect is what your competitors are doing. What about your store placement, promotions, and pricing compares to your competitor? For those manufacturers that rely on product endorsement from store personnel, who are the stores endorsing and why? A Mystery Shop to understand endorsement in the store can provide information on your brand position.
Collecting retail analytics is one of the best ways to stay ahead of the competition, improve customer retention, and create higher profits. But it’s only worthwhile if you actually use it.
Storesupport Canada can help you collect retail analytics and put it to the best use possible. We offer audits for manufacturers to t look at their competitors’ pricing, promotional activity, product placement, online processes, and endorsement. Contact us today to find out how: call 1-877-421-5081 or visit www.storesupport.ca.« Back to Blog