Location intelligence can help businesses gain valuable insights into their customer preferences and interests, competitors, and potential market. They can use these insights to make strategic business decisions. This article covers how location intelligence can help retailers improve business results and deliver an excellent customer experience.
For a few years now, many companies have been using location data and location intelligence on a local, regional, and global scale to make business decisions, improve ROI, and enhance the customer experience. The importance of location intelligence continues to grow in 2020. According to ForbesOpens a new window , 53% of enterprises say that location intelligence is either very important or critically important to achieving their goals this year.
Learn more: Location Intelligence: Every Marketer’s Genie for Data-Driven Insights
Further, in times of crisis such as COVID-19 and the post-pandemic era, location intelligence has become all the more necessary. It gives companies, especially retailers, an understanding of customers’ purchasing patterns and preferences so that they can deliver hassle-free   shopping experiences. Simultaneously, it also helps them make critical business decisions – whether to move into (or out of) a new market, what hours a store should operate, how to improve their supply chain efficiency, and more.
Here are five ways location intelligence can help retail businesses improve their results both in good and bad times.
#1 Delivering Relevant Communications
With an increasing demand for personalization by customers, location data can be smartly paired with the first-party data to deliver targeted and personalized messaging. By tracking customer movements and buying patterns in and around a store, businesses can understand their customer interests and preferences. These insights can help brands deliver messages that are relevant to their customers.
For example, retailers can set up geofencing in certain parts of the stores. When a customer enters or exits that particular area, they can send appropriate messages, offers, or discounts related to the product or similar products to the shopper. Retailers can also identify customer buying patterns and send them appropriate deals and offers. Similarly, they can use location intelligence to help customers who prefer BOPIS (buy online, pick up in-store). According to Incisiv’s The New Store Shopper in High-Touch Retail studyOpens a new window , about 80% of shoppers plan to increase BOPIS and curbside pick-up over the next few months. Using location intelligence, the retailer can suggest the nearest store or vendor where customers can pick up their product.
Jeff WhiteOpens a new window , the Founder and CEO of Gravy Analytics, says, “When brands understand where people go and what they do there, they can create advertising and marketing campaigns that connect more profoundly with their target audience and perform better.â€
#2 Making Store Design Decisions
Store design has become all the more relevant post the COVID-19. Before the coronavirus pandemic, customers would be open to spending time strolling through the retail store looking for the items they needed. However, post-pandemic, people want to get in, pick up their items, and get out as soon as possible. This change is because shoppers are concerned about their health and safety. The recent layout redesign by Walmart across its stores in the U.S. is an example of how stores are making design changes to their layout to make it easier for shoppers to buy products. Retailers can use location intelligence to make layout design changes to make it easier for shoppers to pick up their items.
Learn more: Decoding Location Intelligence: Jeff White, CEO, Gravy AnalyticsOpens a new window
Retailers can implement heat maps within the store premises to collect data such as:
- Aisles with the most footfalls
- How much time a shopper spends at a particular aisle
- Chokepoint or bottleneck areas that hamper the buying process
Collecting and analyzing such data can help retailers to improve the shopping experience for its customers.
#3 Taking Critical Staffing Decisions
Retailer businesses often scale staffing during certain times of the year, depending on seasonal sales data. For example, the sales and support staff is increased around holiday periods such as Thanksgiving and Black Friday. The coronavirus pandemic was another recent scenario where several retailers had to make quick staffing decisions when the customer traffic suddenly dropped due to self-isolation, lockdowns, and movement restrictions.
Retailers can use location intelligence to identify customer traffic in and around certain stores. They can use data to analyze shopper visits in a day relative to the sales and service staff. This data can be used to create appropriate shifts and schedules for the staff to match the customer traffic. Retailers can also use heat maps and determine which parts of the store or which stores in a particular location need more staff to help the shoppers have a hassle-free shopping experience.
#4 Analyzing Market Opportunities and Competitive Strength
Selecting a new store location is one of the most challenging considerations for a brand. Before it plans to enter a new market, a retailer needs to consider various factors and collect several data points. Some of the data they should collect include:
- User demographics in a particular area
- Aggregated foot traffic data for stores in that specific segment
- Locations customers like to visit or shop during their free time
- Market share of competitors and penetration in a particular area
- Customer loyalty to the competing brand
- Pattern and frequency of customer visits to a competing brand’s stores
Location data helps retailers identify new market opportunities and devise strategies to attract the competitor’s less loyal customers. For example, the customers’ visit to a competitor’s store may be less frequent. Or customers may visit other stores after visiting the competitor’s store. This pattern may be an indication that they are looking for certain products in other stores. Brands can attract these customers by offering the products and services they are looking for.
White says, “The ubiquity of mobile phones means that mobile has also become a new source of powerful data for marketers. The data exhaust generated by consumers as they use apps and browse the mobile web now gives us insight into the places that people visit, the stores that they shop at, and the events that they attend.â€
By taking a data-driven approach using location intelligence, retail businesses will be better positioned to make a market decision.
#5 Enhancing Customer Service and Experience
While all the strategies mentioned above and activities contribute to enhancing customer experience, there are a few other ways retailers can use location intelligence to improve customer service and experience. For example, retailers can send opening and closure updates of their stores to their customers across geographies. WalmartOpens a new window is a classic case, which regularly updates its customers across thousands of locations. This activity requires a high level of coordination between various locations to provide accurate updates. Location intelligence makes this possible.
Learn more: Taking Data to the Next Level with Location IntelligenceOpens a new window
Starbucks is another retailer making efficient use of location intelligence. The brand identified that when retail shops would be forced to close and mandatory lockdowns would be imposed during the pandemic, it would increase demand for pick-up and delivery orders. Hence, the brand expanded its delivery optionsOpens a new window across various locations. The brand collected data and insights from various locations as to which customers prefer a delivery and pick-up options across which geographic locations. The brand then acted upon this data quickly and repositioned many of its stores to focus exclusively on drive-thru, delivery, and curbside pickup.
Several other retailers, such as Subway, started selling food staplesOpens a new window such as bread and cheese in areas where people had limited access to grocery stores or shopkeepers were struggling with limited supply.
In Conclusion
Retail brands and marketers today are obtaining more location data than ever from customers. Location intelligence can turn this data into actionable insights that help them make strategic decisions both in good times and in times of crisis. As Herve UthezaOpens a new window , chief data strategy, Here Technologies, says, “The evolution of location intelligence is constant and data science combined with unique algorithms are the key to unlocking predictive behavior of a consumer.†Hence, businesses should leverage location intelligence to generate tangible business results and improve customer experience.
What other ways do you think location intelligence can help retail businesses? We would love to hear from you on FacebookOpens a new window , TwitterOpens a new window , and LinkedInOpens a new window .   Â