Today’s consumers have more choices and are more informed than ever before. They use mobile devices to compare prices while in-store and use coupons or flash sale websites to find the best deal. As a brick and mortar retailer in this hyper-competitive marketplace, you face increased pressure to improve sales and reduce costs to grow profits – and that means you must focus on generating more revenue from existing customers while continuing to add new customers.
To accomplish this, you must first understand what attracts and motivates customers’ purchasing decisions. Ecommerce and mobile channels have a clear advantage in this pursuit. They’re able to test and optimize every aspect of the online shopping experience using robust data points to tailor the shopping experience, capture maximum value from every visit, and entice repeat customers with personalized recommendations.
Brick and mortar retailers spend billions of dollars annually attempting to do the same through business intelligence, secret shopping, customer loyalty, consumer tracking and other in-store data gathering initiatives to make their stores more effective, efficient, and profitable. But, these traditional solutions are expensive, difficult to implement across the entire company, and often generate insights that are simply anecdotal with limited data behind them. How do you gain the kind of visibility you need into daily retail operations so you can quickly and intelligently adjust strategies related to consumer and employee behavior that drive profitability?
Gaining Visibility Into Daily Retail Operations
Several retailers have begun to deploy video-based business intelligence technology, which provides a real-time, factual basis for decision making. At its core, video-driven business intelligence combines video with business data to give users greater insight into their business to make better decisions and drive profit improvement.
Typically, retailers initially use video-driven business intelligence technology to combine point of sale (POS) data with video to visually understand what’s happening behind specific transaction types and sales – for example, viewing actual video to understand customer or employee actions associated with transactions with a promotional item or transactions with a void. However, video-driven business intelligence is not limited to POS data. Video can be combined with any important business data to improve overall store effectiveness.
5 Ways to Improve Store Effectiveness
Combining video with critical business data gives retailers infinite possibilities for studying, testing, and improving retail operations and the factors that drive top line revenue growth. Following are five ways to improve your store’s effectiveness using video with business data:
Improve selling practices, adjust marketing promotions and refine merchandising plans. By integrating video with POS data, you can determine which promotions are most effective at driving store traffic or increasing the total purchase amount, and then easily review actual video associated with those promotions. You can also gain greater visibility to customer demographics and psychographics – for example, you can see actual video to determine whether customers are alone or with others who influenced specific purchase decisions.
Understand what makes customers loyal. You can leverage video-driven business intelligence tools to understand store factors that contribute to customer loyalty: Do loyal customers have a different experience that can be leveraged to develop existing or new customers into loyal customers? For stores with an above average number of loyal customers, are there differences in the store layout, merchandising, or service? Do loyal customers spend more or less time in the store than the average shopper? By accessing video associated with transactions for your loyal customers, you can observe their in-store experience to determine common factors that contribute to their experience.
Understand sales conversions. Video-driven business intelligence systems can track customer traffic into the store and then – combined with POS information – establish the sales conversion rate of the store. Once the store’s conversion rate is determined, you can test new sales techniques and identify which store associates have the highest percentage of cross sells and upsells, as well as identify the best salespeople and watch video footage of their sales to determine the most effective selling techniques.
Identify employees who need additional training. Conversely to #3, by combining video and POS information, you can identify store associates with the lowest percentage of cross sells and upsells and watch associated video to determine what training might help them to perform more effectively.
Virtually audit other aspects of the customer experience inside the store. How friendly and helpful are employees at the customer service desk? Is the store clean? Are shelves adequately stocked and are employees in uniform? Video-driven business intelligence systems can help you review these aspects of the customer experience. One of the greatest aspects of today’s sophisticated video-driven business intelligence technology is it allows you to access recorded video (or even live video, if desired) from anywhere via the Internet – from computers and mobile devices -- so you can easily audit the customer experience without needing to visit individual stores to watch footage.
Today’s retailers have a tremendous opportunity to leverage physical retail locations to improve their store operations. By marrying video and critical business data via a video-driven business intelligence platform, you can gain a complete, factual understanding of daily store operations and the overall customer experience – identifying trends, making informed decisions, and responding quickly and effectively to changing consumer behavior.
Matt is responsible for both the strategic direction and the day-to-day operation of Envysion. Prior to Envysion, Matt was SVP of Corporate Strategy at ICG Communications and held a variety of executive roles at Level 3 Communications, including VP of Consumer Voice, VP of Strategy and VP of Finance. Matt’s early career included stints at management consultancy Bain & Company and IT consultancy Cambridge Technology Partners. Matt received a Bachelors in Civil Engineering and Operations Research from Princeton University and an MBA from the MIT-Sloan School of Management.