Visitor Frequency in Retail

Frequency generation, alongside conversion and cost-optimization, is one of the main performance drivers in retail. In order to perfect its conversion rate and cost-efficiency, a business first has to attract enough visitors. Continuous frequency generation is thus a traditional task in retail, particularly in times when visitor frequencies are falling across the board. The visitor frequency depends, in such times, on having a strategic location, outlet design and operational measures, particularly advertising. Knowledge of the individual visitor frequency is essential for any retail business.

Collecting reliable data to optimize your retail business

The overall visitor frequency has dropped in bricks-and-mortar retail over the last ten years. On the one hand, this is caused by an excess of retail spaces. On the other, increasing online retail has also contributed. The socio-demographic structure of the population has also changed, meaning that changed needs and expectations have led to alterations in purchase behavior.

For retail businesses to use more than just general trends to optimize their performance, the recording of individual data is enormously important. Professional measurement of visitor frequency is a key building-block of retail analysis. After all, only what can be measured can be analyzed. Only if the visitor frequency is known for a specific period of time, the performance can be evaluated.

This visitor frequency can then be compared to the foot traffic past the store. The resulting capture rate gives insight into the proportion of passers-by that become visitors to a store within a set time period. In addition, the ratio of customers to visitors indicates which of the latter actually make a purchase. This ratio is known as the conversion rate. Together with the average receipt amount and number of items bought per sale, these key figures allow the operational monitoring and analysis of retail businesses. These analyses can even take place in real time, meaning that shift changes or marketing and discount measures can be put in place at a moment’s notice. With smart reporting solutions, indicator-based alarm functions using email or push notifications can also be implemented, meaning that the store manager can make on-the-spot decisions when set limits are not met or are exceeded.

Measuring visitor frequency for comprehensive visitor statistics

Visitor frequency is measured using various technologies. Frequency measuring using light barriers at the entrances, meaning every visitor making entry is counted, is already widespread. More modern technology is camera-based. To measure visitor frequency, existing security cameras can often be used, in conjunction with suitable analysis software. The visitor frequency measurement is compliant with data protection, while access to visitor data can be provided on the go and in real time.

Using the visitor frequency, meaningful visitor statistics can be generated and analyzed for different hours of the day, different days, months or whole years. In addition, connections can be made to weather and receipt data. Further key indicators to be determined and analyzed include duration of stay, pathways through the store and hotspots. The age and sex of visitors can also be collected using modern camera technologies. After all, only if visitor frequency can be logically linked to other data and key figures can retailers draw material conclusions from it.

Important factors influencing visitor frequency

Visitor frequency depends on various influencing factors. The three most important levers are the strategic location, store design and operational measures. The strategic location is particularly important due to factors like the core catchment area, concrete location, transport connections (car and public transport), parking, number of competitors, sectoral structure, popularity of frequency anchors and the activities of center or city management. Once a location has been chosen, the foot traffic in that location can only be influenced to a minimal degree.

Decisive influence on frequency generation is exerted by store design and operational measures. Store design includes the frontage, windows and entrance. The performance of these areas can be determined using various sensors outside, providing data on frequency and duration of stay. Customer guidance, the range on offer and the quality of service are also crucial in determining whether visitors would be likely to return or recommend the retail business. In addition, advertising measures that appeal to existing or new target customers have significant influence on visitor frequency.

Optimizing personnel deployment planning and advertising using visitor statistics

With reliable visitor frequency data, a retailer can better calibrate personnel deployment to its fluctuations. In the final analysis, there needs to be enough staff on the sales floor at all times to provide advice and serve visitors. If this is not the case, the conversion rate and average receipt will fall. Overstaffing, on the other hand, leads to higher personnel costs. Knowing and forecasting visitor frequency contributes to optimizing personnel deployment planning.

A further important advantage of visitor frequency measurement is in recording the effect of advertising measures. Particularly the interplay of foot traffic and customer frequency allows for valuable insights, based on changes in visitor frequency, about the success of advertising measures. In addition, the effect that fairs, events and markets have in the vicinity of the store can be assessed.