Beacon Analytics in Retail – 4 Essential Metrics for Retailers
May 19, 2015
It is no secret that retailers all over have doubled down on their proximity marketing efforts by incorporating beacons at various points of their customers’ buying journey. With beacons predicted to directly influence over $4 billion worth of US retail sales this year and retail brands are all set to move out of the pilot phase into mainstream beacon deployments effecting payments, and loyalty programs.
In this blog, we will discuss in detail about 4 in-store metrics that brick and mortar store retailers need to measure to offer a better experience to shoppers.
1. Footfall metrics
According to A.T. Kearney’s Omnichannel Shopping Preferences study, 90% of retail sales still occur at physical stores. So, retailers these days are looking to leverage various techniques to increase store footfalls. While traditional footfall counters just monitor consumers who walk past them, using beacons allows retailers to gain deep insights into consumer behaviour.
For example, you can use beacons to measure how many hours a particular customer spent at the women’s section in your store. Further, when it comes to malls, these metrics can even help monitor the number of people who were sitting on the seats right outside the McDonald’s outlet within the mall and for how long.
One of the factors that plays a critical role in enhancing your store layout is having a sound understanding of customer flow. This is where heat maps, another beacon-enabled feature comes into the picture. These storewide heat maps can help retailers identify customer movements within the store, take note of the hotspots and bottlenecks in store and use that data to make informed product placement decisions.
For example, once retailers analyze the heat map data to identify the parts of the store that are most trafficked, they can drive sales by placing undersold items at these parts. You can also rearrange the shelves to pull desirable items into less busy zones and thus help revive low-performing areas within the store. You can also use this data to promote cross-selling among suitable products.
For example, say Michael Kors skirts at a store are quite popular among customers while Louis Vuitton bags are sold in comparatively lesser numbers. Retailers can place the bags next to the skirts in their efforts to cross sell the products.
Comparing the heat maps from different locations also enables store owners to understand how they can improve each store’s performance. This can be done by testing new strategies or layouts in one store location and deciding on whether it makes sense to roll the same change across the entire chain.
All of this can be achieved by tracking the following metrics:
(1) 1st zone visited
(2) Popular paths
(3) Zone dwell times
(4) Repeat visits
(5) Zone interdependence and zone-to-zone conversions
3. Loyalty metrics
According to “12th Annual Store Systems Study 2015 findings” that were discussed by executives at the NRF 104th Annual Convention & Expo, a whopping 50% of retailers surveyed said that they are not able to effectively use their existing shopper loyalty profiles in-store.
This creates a great disconnect between retailers and their customers. Particularly because today, consumer’s decision to buy and interact with a brand is often based on the ability of the brand to reward them for the time and money spent. Moreover, customer loyalty programs work best when they are intertwined with everyday preferences and needs of your customers. This is where beacons come into the picture.
According to the earlier mentioned survey, 22% of retailers are looking to adopt beacons to take their loyalty programs to the next level. This can be done through a number of ways – right from delivering time-sensitive geo-targeted offers with greater precision to sending customized notifications on offers to patrons when they are closeby.
The primary metrics that matter w.r.t customer loyalty are:
(1) Recurring visitors / Repeat visitors
(2) Visit frequency
(4) Cross-shopping / Cross store visits
4. Engagement metrics
According to a 2014 Shopper Engagement Study done by POPAI, an international trade association for retail marketing, 82% of shoppers’ purchase decisions are made in-store. This further goes on to prove that integrating technology such as beacons into your displays can be huge when it comes to customer engagement.
For example, SapientNitro recently introduced passive beacons, which were launched at at NRF Big Show 2015, to demonstrate a novel in-store approach which allows retailers to offer a beacon experience to consumers even when they are not looking at their smartphones. These beacons tap into the smartphone in a consumer’s pocket and leverage location information along with his/her loyalty profile. Once these beacons tap into a consumer’s past behaviours, including his or her preferences and needs, they accordingly personalize content on a nearby in-store screen.
Here are a few metrics that can help retailers gain better insights on customer engagement in-store and accordingly decide on what needs to be done to enhance it.
(1) Number of engaged customers
(2) Dwell times per store and zone
(3) Mean / Average visit duration
Focusing on the various metrics mentioned in this article will help retailers dig deeper into the data and combine different metrics to get a full view of the store performance and marketing ROI. Are there other metrics that you think are critical to retail success? Let us know in the comments below.
If you are planning a beacon pilot, take a look at Beaconstac, that includes everything you need to get started. Using Beaconstac you can set up your own campaign, without a developer’s help!