Accuracy is King

If you thought the days of bricks and mortar were over, think again. Worldwide sales in retail have grown by nearly 10%, indicating lots of momentum. An analysis by Insider Intelligence predicts that retail sales are anticipated to grow between 4% and 5% each year through to 2025.  

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According to a survey from Sponsorpulse, Gen Z and Gen X are the only generations that shop in-store more than they do online. Boomers, surprisingly, and millennials had a higher portion of online versus in-store purchases, largely due to shopping behaviour adopted during the pandemic. New research from McKinsey shows shopping patterns are moving back toward the pre-pandemic status quo. In fact 20% of consumers say that they are now doing all their shopping in-store, and only 5% shop exclusively online.

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What does that mean for retailers? It might be time to up your game when it comes to data collection. Online retailing offers real-time, accurate data – who bought what, when, and so on. Because we assume there’s no real way to track this kind of information in store, many retailers work based on pure revenue numbers and a gut feel. That affects all areas of their business, including resource management and staffing. We all have views on how well the day, week or month went, and we typically make assumptions around why. In reality, things might be very different, and you may be missing opportunities to increase revenue.

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Maybe foot traffic was actually much larger than assumed, and you have trends of increased foot traffic over certain periods of the day and week. With the right data over time, incorporating external elements like weather, economy, holidays and pay cycles, you can resource your business to maximise conversion rates. Without it, you’ll miss your shot. Knowing your conversion rate is accurate is the difference between making those sales and leaving large amounts of profitability on the shop floor.

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But it’s not just footfall that data collection can help with. We all know your people are the key to any successful retail business, so it’s worth knowing how you can maximise their contribution. If they are placed in the right place at the right time on the right day, it’s easier to deliver the right level of service for the customers, and for your business. Well-managed staffing also gives your people the time to understand and educate the customer, make recommendations and up-sell to close the sale. If you have a lower value, higher volume business, you also need to make sure you have the correct resourcing in place to process sales at the peaks or you also lose the ability to maximise sales.  

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Real-time data collection can give you the information you need to get the most out of your people, and therefore get the most out of your business. It gives you the knowledge – in real time – that you need to make rostering and positioning decisions. It allows you to avoid pitfalls with drivers like commission schemes that are evaluated retrospectively, because you’re receiving timely information. So, with real-time data monitoring and collection, you’ll have timely outcomes too, and you’ll stop giving dollars away with drivers that don’t drive outcomes.

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Another common downfall of the retailer is inaccurate core data. You might be thinking ‘yes, I count my foot traffic, yes I have the right resource at the right time, yes I have good KPIs, yes I have a strong commission scheme, yes I have the right people at the right time’. But is your core data actually accurate? You might have invested in one of the many “people counters” now available in this industry. But the quality can vary, as can the accuracy, with the options available now delivering from 10 to 90% error rates. This puts all the planning, rostering and sales frameworks in jeopardy due to inaccurate data from an inferior platform.  

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That’s not to say that people counting technology is a bad idea. In fact, a smart counting solution can add massive value to your business. The key is to do your research and pick a platform that’s as accurate as possible. If you’re gathering accurate data, you can maximise profitability with the knowledge you gain.  This technology enables you to optimise rostering to fit demand, ensure the resource is there to meet the sales potential and ensure every marketing dollar you spend is working for you. People counting or monitoring will have a positive effect on the profitability and medium to long term financial health of your business, so long as you invest in accuracy. Put simply, accuracy is king.

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Based on eMarketer, Insider Intelligence report (2022)  https://on.emarketer.com/rs/867-SLG-901/images/eMarketer%20Global%20Ecommerce%20Forecast%20Report.pdf

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Statista in cooperation with Sponsorpulse April  share of customers in-store and online (2021)https://www.statista.com/statistics/1230474/share-of-us-consumers-that-shopped-online-and-offline-by-generation/

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McKinsey & Company How US consumers are feeling, shopping and spending (2022) https://www.mckinsey.com/business-functions/growth-marketing-and-sales/our-insights/how-us-consumers-are-feeling-shopping-and-spending-and-what-it-means-for-companies

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