5 Ways Canadian Retailers Should Be Using Location Data and Technology
Read to know why location technology and location data sets are indispensable weapons in any Retailer’s artillery
2017 was a confusing year for Canada’s retail industry. On one hand, Canadians were left shocked by Sears Canada announcing shutdown, and on the other, a record number of international brands opened brick-and-mortar stores in the country – more than 50 to be precise and including big names like Kohler, Hublot, and Genesis Motors.
2018, meanwhile, has confirmed that people talking about ‘retail apocalypse’ have only been crying wolf. According to Retail Insider, by July 2018 alone more than 30 retail concepts had either already opened stores in Canada, or were going to later in the year.
It actually makes sense because Canadians, in any case, are not as fond of online shopping as their neighbors from across the border. Compared to $1,230 per person per capita online shopping spend in the United States, Canadians spend only $730. Canadian store owners clearly have an enviable advantage over their e-commerce counterparts. However, nobody knows how long that advantage will last. If more and more brands entering Canada’s retail ecosystem was not enough, global research firm Nielsen is confident that by 2020, Canadian FMCG e-commerce sales would outpace brick and mortar store sales by a margin of seven to one.
Therefore, the time is ripe for forward-thinking retailers to future-proof themselves with tools that would give them a clear picture of the business landscape. And when it comes to understanding the changing buyer behavior or spot hidden trends, location technology and datasets have proven time and again to be indispensable weapons in any retailer’s artillery. Some use cases of how location technology and data has been helping retailers are discussed below:
Customer Analysis
Even the best of marketing strategies are no good if they fail to get the right product in front of the right buyers at the right time. This is why customer profiling is extremely important for retailers. And when it comes to understanding where prospective clients are located or figuring out the exact addresses of most profitable consumer groups, there’s nothing quite as effective as location data and technology. Collating socio-economic demographic information on a map gives a clear understanding of where different territories stand in terms of gender, age, race, annual income, language, education, etc. Retailers can identify their target groups easily and customize their marketing strategy accordingly.
Market Segmentation
While market analysis is an important tool for enhancing the operational efficiency of a store, effective market analysis does not happen in silos. Not only do retailers need to understand their own store’s performance, they must also be aware of how the competition in the same territory is faring. Taking cognizance of the employment rates in the region, they should know if the median household income is going up or down. Only after mapping all these factors against a store’s performance data can a retailer figure out what changes are needed in the inventory. Important decisions like whether a store should be shut down or if a new one must be opened are also dependent on accurate location data and technology.
Store Site Selection
The demise of traditional site selection techniques was declared the moment e-commerce giant Amazon decided to develop a brick-and-mortar portfolio. In Amazon’s 2017 acquisition of US grocery chain Whole Foods, the latter’s intelligent site selection model had a big role to play. Whole Foods’ 400 store locations tapped into an affluent customer base perfectly, giving Amazon the edge it needed to announce its arrival into the world of physical retail in a grand manner. But this is only one of the examples of how location technology and data can be leveraged for store site selection. Retailers can also check for parameters like where the competitors are located, drive times from various neighborhoods, delivery routes, etc.
Market Planning
Planning for merchandising and space utilization in a manner that leads to an increase in the basket size of the customer is no mean feat. But location data can make this task easier for Canadian retailers. Visualizing store data on a map can lay bare insights like which products regularly run out of stock or which items have received negative feedback and where. Retailers can also understand where a particular promotion strategy has gotten them maximum returns or where sales have failed to pick up despite offering discounts. Come Christmas or Black Friday and insights like these could make a world of difference in a store’s bottom line.
Geofenced Advertising
Geofencing is a location-based marketing technique wherein a virtual boundary is set around a specific area. Whenever anyone enters the geofenced area, a digital promotional message is pushed out to them via text, email, in-app notification, etc. Many big-box retailers like The North Face, L’Oreal, Starbucks, etc., have already witnessed success with geo-targeted advertising by putting geofences not only around their stores but also in common areas like parks and public squares. Geofencing is a gold mine which is simply waiting to be exploited by Canadian retailers.
To sum up, location technology and data are ideal tools for retailers to maximize their revenues and boost customer satisfaction. Progressive retailers will leverage these tools for making informed decisions and fortify themselves against the competition as well as the impending e-commerce invasion in Canada.
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