In today’s competitive market, retailers need to understand their customers better than ever. But how do they do that? The answer lies in retail analytics and audience measurement. If you’re unfamiliar with these terms, don’t worry! This guide will break everything down in simple terms.
What Is Retail Analytics?
Retail analytics is the process of collecting and analysing data from multiple sources to help brick-and-mortar stores make better-informed business decisions. Think of it as a way for retailers to track how customers behave in their stores and interact with products, so that they can improve store layouts, product offerings, services, and the overall customer experience.
Imagine a grocery store. If the owner knows which products sell the most, what times customers shop, and how long they stay, they can stock the right items, adjust store hours, and improve the shopping experience. That’s retail analytics in action.
What Is Audience Measurement?
Audience measurement is a tool within retail analytics that tracks how in-store customers interact with screen content. It helps retailers understand the demographics, behaviours, and engagement of their in-store audience, including:
- Number of viewers
- Demographics, such as age and gender
- How long they engage with the content
- Opportunities to view the content
- Emotions at the time of viewing
Just like websites track visitors, physical stores can now measure their in-store audience using sensors, cameras, and other technologies. This helps traditional retailers make smarter decisions to optimise screen content, and marketing strategies, and improve customer engagement.
Why Is Retail Analytics Important?
Retail analytics and audience measurement are important because they help stores:
- Increase Sales – By understanding customer behaviour, retailers can optimise store layouts, product placement, and promotions to attract more buyers and drive sales.
- Enhance Customer Experience – By understanding customer preferences, retailers can provide better service and create a more enjoyable shopping experience.
- Optimise Inventory – Retailers can stock high-demand products and avoid overstocking slow-moving items.
- Improve Marketing – Retailers can target the right audience with personalised promotions.
- Stay Competitive – In today’s retail world, retailers that use data have an advantage over those that don’t.
How Do Stores Measure Customer Behaviour?
Brick-and-mortar retail stores use different tools and technologies to track and analyse customer data. Some common methods include:
1. Foot Traffic Counters
These sensors track the number of people entering and exiting a store, helping retailers understand peak shopping hours, measure customer flow, and optimise staffing and store operations.
2. Heatmaps
Heatmaps use sensors or cameras to track customer movement and identify high-traffic areas within a store. This helps retailers identify which products or displays attract the most attention.
3. Facial Recognition & Demographic Analysis
Advanced cameras can estimate a shopper’s age and gender, allowing retailers to better understand who their customers are and adjust their marketing strategies accordingly.
4. Wi-Fi & Mobile Tracking
Many stores that offer free Wi-Fi can track customer behaviour by monitoring how long they stay and which areas they visit once connected. This data helps retailers improve store layouts and promotions.
5. Point-of-Sale (POS) Data
Every time a customer make a purchase, the store collects data on what was bought, when, and how often. This helps retailers manage inventory and predict future sales trends.
Real-Life Examples
Example 1: A Clothing Store
A clothing store notices that most shoppers spend time near the men’s section but don’t buy much. After analysing the data, they find that the section lacks variety. They add more options, and sales increase.
Example 2: A Supermarket
A supermarket uses heatmaps to identify high-traffic areas, like the dairy section, and notices a promotional display nearby isn’t attracting attention. By moving the display closer to the dairy, sales increase.
The Future of Retail Analytics
Retail analytics is constantly evolving. In the future, retail stores may use AI (artificial intelligence) to predict trends even before customers realise what they want. Personalised shopping experiences, smart shelves, and virtual fitting rooms could become the norm, transforming how retailers engage with customers and enhance the shopping experience.
Final Thoughts
Retail analytics and audience measurement help retailers make informed decisions, enhance the customer experience, and boost sales. By understanding shopper behaviour, retailers can improve their shopping environments and stay ahead of the competition.
So, next time you step into a store, remember – there’s a good chance your shopping habits are helping retailers make smarter decisions and better experiences!