Wednesday, November 12, 2014

Increase customer conversion rates in retail stores

Increase customer conversion rates in retail stores

Retailers all know that to increase retail sales, they need to drive more prospect traffic to their stores, convert shoppers to buyers and increase the average spending per customer. Driving traffic to your store and increasing the average spending per customer will be discussed on separate articles. Below are some tips to help you increase customer conversion rate and get that sales needle shifting.

Low visits or low conversion?
To calculate customer conversion rates, you need to first know if shoppers are visiting your store but not buying, or there are simply very little visitors to your store. Tracking the number of shoppers entering your store would give you a good idea of this.
There are many people counting systems in the market such as infrared beams and thermal imaging. A new upcoming approach is video analytics which uses computer vision algorithm to count the number of visitors. Besides its high accuracy, video analytics is flexible and gives users compiled reports in real time. Many big-scale and multi-chain retailers have deployed this system to sharpen their insights of their businesses. There are but a few vendors due to the technological barriers; with RetailNext and KAI Square’s VAaaS are some of the key players in the market.
Knowing the number of visitors to your store would allow you to take necessary actions to attract more visitors or convert visitors into customers.

Encourage prospects to enter your store
Appearance matters a lot when it comes to attracting visitors to your store. Capture the traffic by maintaining an attractive store front. In the previous post, we talked about having a good window display and how this helps in catching people’s attention, slowing them down and attracting them into your store. A good window display is essential even for smaller retailers.
Besides window display, placing the right products near the entrance would help attract visitors. Place the newest collection, the most attractive products or key signage near the entrance. Also, work on the product display and assortment. One way you can do this is by inducing a mood and a storyline. For example if you are a kitchenware retailer, create a dream home-like environment with the newest chinaware collection near the entrance. If you are looking to attract the mass, you may place sale items or lower price items with price signage near the entrance.

Retain customers in your store
In many retail businesses, you would want customers to stay in your store longer. The longer they linger the higher chance of spending more. One way you can retain customers is by creating a welcoming and pleasant store ambience
70% of purchase decisions are in-store decisions and these are largely influenced by store ambience. There are some aspects to store ambience, the smell, product displays, signage, furnishings, music, lighting, colour, the list goes on. The effects of pleasant ambient stimuli through scent and music have proven to be an effective way to retain shoppers. Studies have shown that smell influences intent when visiting a store and thus increases spending. Shoppers were more likely to buy in a scented store than an unscented one. Depending on how you want to brand your shop, from elaborate furnishings to a minimalist approach, keep the fixtures and colours of your shop consistent throughout. Ensure appropriate lighting, clear signage, well painted/textured walls are in place before getting creative with unique product display, display platforms, mannequins and fixtures. If you are on a tight budget, avoid customised furnishing and fixtures and get creative with low cost DIY ideas! One great example is Scrumptious Reads, a bookstore in Australia that uses paper coffee cups to create a unique personality.

Scrumptious Reads Book Store in Australia

While you work on how you want your display racks to form up, remember to create a subtle path within your store. Drawing out your floor plan would allow you to organise your space well. Next, decide how you want to organise your products as you do not want your products wildly placed around your store. There are several ways of categorizing your products – type, colour, collection, price or theme. By creating a path, you create a natural movement around your store that keeps customers moving and removes ‘dead zones’ in your store. You may wish to monitor the human traffic flow within your store to understand your customer behaviour and if you need to make changes to your store layout.

Convert lookers to buyers
Good customer service can be a major push for converting lookers to buyers and a good way to start this is to understand your customers - what are the popular products that customers from a certain customer segment look for? Approach customers with a question and thoughtfully help them analyse and find the products they are looking for. Sales require understanding and strategizing and not just mere selling.
Besides having in store sales to boost purchases, clever placement and display of signage can help boost sales. One clever way is by suggesting styles through visuals to encourage shoppers to buy that look. Another way would be stating how popular or effective a particular product is with other shoppers depending on the nature of your business.

Only approximately 35% of retailers track traffic and conversion rates. Counting the number of people who enter your store would allow you to calculate the conversion rate. Having statistics about your customers would help you to make improvements to your retail space to serve them better, thus leading to overall increase in sales. Shoppers may visit your store with the intention to purchase but instead leave empty handed. With retail solutions such as KAI Square’s business intelligence analytics, you would be able to understand the conversion rate in your store easily. You may drop an email to to find out more about our services.