A steady decline in foot traffic over a given period will result in decreased sales in about 13 months. It’s important to know how many people are coming into your store and why they are choosing to shop there as opposed to another similar business. People counting software and its related performance indicators can help shine a light on how many people are walking through the doors, what they are looking for and why they chose your store or location over another.
Here are four key performance indicators you should incorporate into your business/people counting metrics:
The effectiveness of promotions at generating store traffic
Promotions, customer loyalty programs and coupons can all go a long way to maintaining your customer base, but it’s important to be able to gauge what’s resonating with your target audience and what’s missing the mark. One published report said that a promotion that resulted in a 7 percent increase in total sales can be considered successful. If the promotion reports a boost in foot traffic alone, it’s time to reevaluate that effort because it’s not yielding additional sales. By using people counting software to calculate how much foot traffic and sales increase during a promotional period, business owners can optimize their advertising and marketing budgets to focus on the initiatives that have a proven track record of success.
Conversion rate
As we said in the previous example, getting people in the door is great, but it doesn’t pay the bills. Many people who come through the doors are “just looking,” and leave without making a purchase. The traffic counts from your people counting software, combined with the sales data, can be used as a conversion rate. A conversion rate is a comparison of how many people came into the store and made a purchase against how many left empty-handed.
This is an important indicator of your business’ performance day-to-day, week-to-week and year-to-year. If sales are down, the conversion rate can tell you if it’s a result of a decline in foot traffic. If foot traffic hasn’t changed, the conversion rate will show that traffic is no longer leading to sales. These numbers can also be compared for a multi-store chain or to measure the effectiveness of a promotional campaign.
Observe customer traffic flow and entrance use
It would take a fleet of employees to monitor all of the entrances of a larger store from open to close. Week after week, it would get quite expensive to employ people just to monitor the entrances and the variables that affect which doors people use. For example, on a rainy day, more people may use the door closest to the parking lot, while a sale in another department may draw more shoppers through the door closest to that area. People counting software is the same thing as employing teams of doormen, but it’s more cost effective, never calls in sick and is always accurate
Monitor customer visits to optimize labor planning
Stores and restaurants that are short-staffed during the busiest times have harried, frazzled staff that are prone to making mistakes. These mistakes could cost the business time, money and employee morale, so smart scheduling to ensure proper coverage is ideal. But you also want to avoid having so many people scheduled during a shift that there’s not enough work to go around. Staff is one of the biggest expenses a business has, so use it smartly. People counting software can help calculate a shopper to staff ratio to make sure no single employee is overburdened with tasks.
These four performance indicators can help owners gain a better understanding of their businesses. In order to benefit from a people counting system, you must be looking for the right things. Paying attention to the ebb and flow of traffic can help owners learn how and why certain promotions work while others don’t.
