Nowadays, it can sometimes feel like brick-and-mortar retailers are at a distinct disadvantage compared to their ecommerce peers. Reports of ecommerce’s global growth can make it seem like brick-and-mortar retailers are gradually going extinct.
This isn’t the case. In fact, the National Retail Federation reports that retailers announced over 8,100 store openings in 2021 — more than double the 3,950 announced store closings. While shopper preferences clearly play a factor in the survival and success of brick-and-mortar retailers, so does a store’s ability to use the same kinds of data insights used by ecommerce businesses.
By focusing on the right kinds of data, brick-and-mortar retailers can gain valuable insights into their customers, effectively helping them achieve even greater growth.
1. Traffic patterns
When it comes to tracking store traffic, ecommerce websites have it easy. Website analytics allow them to see how many people visit their website at any given time — and, of course, visitors can access their store 24/7.
For brick-and-mortar retailers that can’t stay open around the clock, tracking foot traffic can be a bit more challenging yet even more important. Understanding how many customers enter your store at a particular time can help you understand when your store needs the most staff available and even determine key metrics like in-store conversion rates. This can help retailers understand when to run promotions or how to optimize shift scheduling — activities that directly influence sales numbers and customer satisfaction.
One example of new tech that enables brick-and-mortar retailers to better track their foot traffic is Dor, a people-counting device that uses a thermal sensor to anonymously track how many people enter or exit a store — simply by being mounted over the entryway.
By collecting traffic data, businesses have the baseline information they need to begin tracking conversion rates and improving their store operations, something that ecommerce retailers have long been able to take for granted.
2. Tracking shopper behavior
Ecommerce websites aren’t just able to track how many people visit the website. They can also track what pages they visit, what product promotions yield the most attention and more. Fortunately, brick-and-mortar retailers are increasingly gaining access to tools and devices that also allow them to see how shoppers behave in-store.
One example of this comes from Shopic, which offers a clip-on smart cart device. In an interview with Cheddar News, Raz Golan, CEO of Shopic explained, “We have created a device that connects to standard shopping carts, turning them into smart carts only when shoppers are using it. So we’re basically allowing grocers to bring all the benefits of online shopping to their physical supermarkets. [In ecommerce], they can measure things online and know exactly what is happening — who clicked on what, how much time they spent, what page. We’re basically unveiling this data that was not available for them in the physical space.”
The system is able to anonymously report on which items customers purchase, as well as create a heat map that shows which parts of the store they spent the most time in. Such information is helping grocers understand which products sell best at which times, as well as identify ways to optimize their store layout to maximize consumer purchases.
3. Inventory management dashboards
Brick-and-mortar businesses depend on having an adequate inventory of in-demand products. Optimizing in-store inventory allows retailers to restock items on a predictive basis, using analytics trends to identify when and how much to stock each item. This way, they won’t have low-selling items taking up space on store shelves or find that they didn’t order enough of an in-demand item.
Business intelligence dashboards that provide predictive analytics based on current and past customer behavior can help brick-and-mortar retailers avoid the type of issues Target has experienced recently.
As The New York Timesreports, “[Target] had $15.3 billion in inventory, a 36% increase from a year earlier. As shoppers have curtailed their spending on items deemed discretionary, squeezed by higher-than-usual prices in essential categories like grocery and gas, Target was left with electronics and apparel that people were not buying. Target said it was solving the problem by using discounts and canceling orders for the fall with vendors, which would result in lower profit.”
A business intelligence dashboard that links with suppliers and helps businesses adapt inventory restocks as needed can help reduce the risk of such occurrences. Reliable inventory tracking, when paired with predictive analytics, will improve profitability.
While implementing sound data collection practices for a brick-and-mortar retailer may be somewhat more challenging than they would be for an ecommerce store, there is no denying that data can still become a powerful resource for your physical store.
By taking advantage of the tech integrations that provide ecommerce style data, brick-and-mortar retailers will be better positioned to understand shopper behaviors and market to them appropriately — while also boosting supply chain efficiency to lower operating costs.