How to turn loss prevention into sales and service
It’s no secret that it’s a challenging retail environment out there. The threat of an Australian recession, high household debt, and the seismic shift in consumer behaviour in a post-digital world present very real challenges. You don’t have to look very far to see the headlines about retail slumps, most recently with retail landlord Vicinity Centres posting a 72 per cent decline in its full-year profits.
However, smart retailers are finding innovative ways to thrive and survive in a world where customer expectations are high and the proliferation of online and offline choices means no one can afford to rest on their laurels. It’s never been more important to truly know your customer, and one of the ways retailers are enriching this knowledge is by leveraging the data that is already gathered by physical security.
It may not be the first thing that springs to mind, but it is highly possible and extremely valuable to use physical security insights to make informed decisions that can improve operations, enhance customer experience and increase profits.
Capturing valuable information
Most retailers already have a video surveillance platform in place to protect people, property and merchandise from theft, accidents, cash handling and suspicious activity. These video security systems are usually owned by loss-prevention departments, with the data and insights captured remaining within the silo of that team and seldom crossing over into other business functions and areas.
This is a lost opportunity because the data captured can not only protect an existing retail business, but also help it grow. Every day, a security system captures valuable information that has the power to transform a business – retailers just need to add analytics to the mix.
Advanced retail analytics solutions take the information gathered from video surveillance systems and use it to unlock consumer insights, improve staff performance, enhance the customer experience and boost sales conversion rates. Critically, when added as part of a unified security solution, it can be applicable to either a single store in a single country or across multiple locations across the globe.
Visitor counting and sales conversion
This means that regardless of the size of a retail imprint, it’s possible to gain a detailed view of your business: a single pane of glass through which you can view all of your data to make informed decisions.
By tapping into video gathered via a physical security system that’s already in place, retail analytics applications use modules like visitor counting, conversion rates, queue management, heat maps and directional analysis to better understand customer behaviour and make real-time informed decisions that increase both consumer engagement and in-store profitability.
Importantly, this single view into product and customer data is something retailers can manage themselves, potentially freeing themselves from the cost of expensive analysts who might previously have been engaged to make sense of disparate data points.
Real-world insights for real-time action
So how does this work in practice? Let’s start with conversion, where studies have shown that 90 per cent of consumers are more likely to convert from just browsing to a sale when they are helped by a knowledgeable associate. An advanced retail analytics solution can be set up to notify management which departments are crowded so that they can assign enough associates to help with any inquiries. This can both accelerate conversions and reduce the cost of labour through better employee management. Losing sales due to long lines at the checkout counter? Retail analytics solutions can help reduce customer abandonment caused by long queues by notifying management when long lines are detected. These solutions help managers take action at a moment’s notice and turn undesirable situations into more profitable outcomes.
Display and promotion effectiveness – and other longer-term issues – can also be improved with a feature like heat-mapping. By visualising the areas in a store that represent hot areas – where shoppers dwell – compared with cold areas which receive very little foot traffic, managers can measure the effectiveness of certain displays and promotions and make changes accordingly.
Knowing what online knows
Retail analytics software applications can make the most of existing security resources and use the invaluable data they already gather to benefit a variety of departments in a retail establishment – retail marketing, retail operations and merchandising. One of the most important benefits offered by retail analytics solutions that are part of a unified security solution is the additional information they can provide physical stores to compete with online retailers. Online retailers have long had the distinct advantage to easily collect vast amounts of data and analytics from every customer visit. Today, traditional bricks-and-mortar retailers are wising up and are beginning to bridge the data gap, as well.
It’s time to leverage the video data you are already collecting in your retail establishment and employ the use of retail analytics to improve your sales, operations and customer experience.
Author: George Moawad is country manager ANZ for Genetec, a VMS (video management software) vendor. He has over 20 years’ experience in the electronic security industry and holds an MBA from the Australian Institute of Business.
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