When Retail Customers Count

Why Count Customers?

The most fundamental of retail metrics is largely unused or misused ? if you’re not looking at traffic information, how are you managing your store?

Early in my retail career, I spent a lot of time learning. Learning about how retail business?successful retail business?is conducted. I learned about inventory management and about recruiting and training staff; I learned about retail selling, customer service, merchandising, and of course, retail marketing. During these years, I watched retail change. I watched the downfall of the traditional department store, the rise of specialty retailing and the advent of the ‘big box’ category killers. I was there when the Internet was going to change the face of retailing forever (it did, but not in the ways pundits were predicting). So here we are.

Retail is undoubtedly a far more complicated and sophisticated business than ever before. Successful retailers need to stay on their toes. History is littered with retail giants once thought to be everlasting fixtures in the retailing landscape, but now gone. However, as much as things have changed, certain fundamentals have remained unchanged?such as prospects needing to visit the store in order to make a purchase. This idea of prospect ‘traffic’ is one of the few constants in an otherwise constantly changing retail landscape. Furthermore, it is a notion that applies to virtually every retailer.  So why doesn’t everybody track traffic? Good question.

I didn’t start out being a retail traffic ‘guru’. Nope. I was just a retail marketing manager for a single location specialty store who was simply trying to understand if his advertising was working or not. Pretty simple question, isn’t it? It seemed simple enough when the owner of the store I worked for asked me how we would know if the annual marketing plan I prepared would work?how would we know if this was the right plan? As I hunted for information on measuring retail advertising, I discovered there were no simple answers?there was a lot of general information about marketing effectiveness but none that seemed to be specific enough; none that could help me answer my question.

Ultimately, my quest to find the answer to this question led me to traffic counting.

Not only did monitoring traffic help us understand if our advertising was working or not, it became apparent that traffic information was also very useful in scheduling staff,  understanding sales performance, determining store hours, planning in-store events and much, much more. Wow! This traffic information is great stuff. Why couldn’t I find anything about traffic counting in all those retail management books I read? Why is that even today, the vast majority of retailers don’t even bother to monitor store traffic, and even the ones that do only review the data periodically and usually not in any depth? I don’t really have a good answer for this. In fact, to this day, when I talk to retailers (successful major retail chains at that), I often feel like Christopher Columbus trying to convince the magistrates of the 15^th century that the world is indeed round, not flat.

When Retail Customers Count is the book I would have greatly appreciated reading back in my early days. The book covers a wide range of ways traffic analysis can be used to help retailers (and service businesses that receive pedestrian traffic) manage their operations more effectively. The book is as relevant for independent single location retail merchants as it is for executives of mega chains, and it really doesn’t matter if your store sells shoes, shovels, crafts or cars?retailers in virtually every retail segment can benefit from traffic analysis.

Although there is a multitude of uses for traffic analysis, I’ve focused on the areas that would be of most interest to most retailers. Specifically, here’s what is in store (pardon the pun).

• Chapter 1: Measuring the Impact of Advertising? It’s true, you really can measure the impact of your advertising and promotions. This chapter is full of examples of advertising traffic responses, setting objectives and the like.

• Chapter 2: Setting and Refining Store Hours? Traffic analysis can provide all sorts of insights to assist with decision support, and setting store hours is one of those questions that retailers are constantly grappling with. Traffic analysis can help.

• Chapter 3: The Impact of Weather on Traffic? You can’t control the weather, but you can control what you do when weather happens. This chapter will describe the different ways that weather can impact traffic and what you can do to make the most of it.

• Chapter 4: Sales Conversion– Turning Shoppers into Buyers ? This is arguably the most critical chapter in the book, as sales conversion is among the most important performance measures in retail. This chapter is a must read.