Today customer traffic counters allow getting extended information on store traffic, but not all retailers know how to use it to maximum effect. Most often it's to do with the fact that a company’s management wants to install a people counting system but doesn’t set the goals to be reached after the system is installed. So the new equipment is set up and is counting visitors but, in fact, one doesn’t benefit greatly from it.
ROI (Return on Investment) is one of the most significant indicators in retail. It is a financial coefficient reflecting business return level resulting from investments into that business. ROI is the amount of return (loss) on an investment relative to the investment cost and is measured as a percentage. ROI is a very important performance measure demonstrating efficiency of the investments, whether it is a new advertising campaign or staff training courses.
Ability to measure ROI using a customer counting system guarantees successful and well-targeted investments for retailers. Integration of traffic data with other business metrics, like fiscal data, will allow to get the analysis of a company’s efficiency:
- Conversion rate
- Customer traffic peak hours/days/months (least and most activity periods)
- Marketing campaign efficiency
Sales figures show the amount of goods sold and the time when the transactions were made. Many companies consider such data to be exhaustive, however, it's impossible to accurately track conversion rates if you don’t know the exact number of potential buyers – visitors that haven’t made a purchase. Using the customer traffic analysis system that tracks the number of visitors at any specific time and combining the obtained information with sales figures, retailers can determine how high or low their conversion rate is.
Conversion rate plays a major role in company efficiency assessment. It makes it possible for retailers to discover any changes in demand and in customer activity, as well as to get details on seasonal sales variations and influence of promotional campaigns on visitor footfall. Bsically, conversion rates provide the means to estimate the performance of every store and region in a retail chain.
Customer Traffic Peak Hours/Days/Months
In addition to conversion rates, extended reports from a people counting system can provide data on the busiest periods for a store, mall or retail chain. That data is crucial for establishing and optimizing employee work schedule, Finding balance in terms of the number of employees on duty is one of the main tasks in retail business. Customers don’t like wasting time in lines, but so-called chair warmers can come too expensive. The dynamic report with 10-minute and 1-hour intervals will help find a way to recruit the right number of staff for high quality service. And it doesn't just include consultants, it can also be applied to cleaning staff.
Moreover, you can use peak time data to prepare for busiest months and make sure you have enough items in stock.
Marketing Campaign Efficiency
Retailers spend significant amounts of money on promotional campaigns, and such investments grow as the new ways of customer attraction emerge — this means that it's important to choose the most effective strategy. How can companies track the efficiency of marketing campaigns besides examining sales rates? Counting visitors before, after and during the campaign will provide data on its productivity and effect. However, one shouldn’t forget about sales in this period, so the customer attraction indicators and conversion rate are to be estimated as a whole.
Besides, structured data representation offers one more advantage: a retail chain can compare the results of promotional campaigns in each of its stores and figure out the factors influencing success and footfall traffic the most (geography, target audience, staff, etc.).
These are only some of the ways to maximize ROI of a customer traffic counting system. Each company can find a strategy that suits it best.