Planning for the yearly ebb and flow of online and offline traffic to your small business doesn’t have to be painful. Even the best retailers can miss a beat when it comes to optimizing their store’s seasonality – the rise and fall of customer needs throughout the year - but it doesn’t need to feel like a game of chance.
The most well known season for many retailers is the holidays from mid-November through the end of December. This is the season where customers spend frivolously beyond their necessities and are more impressionable to sentimental marketing. Many retailers bring their business “into the black”, or finally profitable, for the first time in the year during this season. These busy two months can account for over 25% of a retailer’s total revenue for a year. For example, in 2015, jewelry stores brought in 19.20% of their total annual revenue in December, preceded by 8.44% of revenue generated in November. The success of these businesses ride on such a brief period of time, the result of a bad season will have a considerable impact on the retailer’s sustainability.
While the holidays are generous to many retailers, seasonality ultimately depends on the market’s need for your product. For example, auto dealerships experience increases in sales and traffic during summer months while home gardening stores see 38.43% increase in sales from April through July when people are gathering materials for their gardens. These 3 contrasting seasonal trends directly reflect the diverse needs of each market segment. Whether you’re a car dealership, clothing store or a small home gardening shop, seasonality exists for your shoppers and it’s up to you to provide quality services during both peak and low seasons.
Regardless of your peak season (or seasons), preparing for these times is essential to your business’s success. Lack of preparation leads to financial frustration and low customer satisfaction, so retailers must pay close attention to how they organize their staff, store hours, and inventory in order to succeed in each season.
Coordinating staff is amongst the top pain points small retailers face. As one of the largest out-of-pocket expenses, managing staff hours requires strategic planning to keep expenses to a minimum and shopper satisfaction at its maximum. The problem retailers experience when coordinating staff schedules to seasonality is when it becomes a guessing game of when the high-traffic times will be and how many staff members are required to appropriately service the projected volume of customer visits. Retailers strive to accomplish a perfect balance of shoppers-to-associates, and until the recent developments in retail analytics like traffic counting, the potential to use this as a strategy remained cloudy.
Many small businesses operate roughly 50 hours a week, with 10 of these hours outside the weekday 9-to-5 window. For some, this common structure of operating hours works, and for others it’s different. Put briefly, it’s vital to regularly review normal store hours to make sure it’s a successful plan, and be open to adjusting those hours meet high or low-demand seasons. For example, an apparel store that gets busy during the holidays should consider staying open later in the evening if consumer traffic is high at the end of the day. In the end it’s up to the management to take initiative during every seasons and identify the optimal hours for business.
Managing inventory throughout the year is another critical process when it comes to seasonality. Retailers must constantly review their sales performance to determine which products are moving, and where to slow down in order to predict next month’s demands. Not enough inventory and you lose sales opportunities; too much and you lose money to markdowns and sales. Organization is a significant part of keeping up with customer demand and your inventory needs in check, but the differentiator is anticipating those needs in advance based on your understanding of the market.
Using Data To Optimize Seasonal Activities
Technology is expanding into every aspect of retail whether it be online or in-store, creating opportunities to better understand your operations and peak times for transactions. People-counting applications like the Scanalytics SoleSensor, an intelligent floor sensor that measures foot traffic behavior in physical spaces, have made an enormous impact on retail by using accurate insights to solve pain points such as improving ROI, optimizing staff, and heightening customer service standards.
When talking about retail analytics and staff scheduling, the benefit is simple: knowing how many people come into your store on any given day makes it easier to schedule team hours. On heavy traffic days, schedule not only more staff but also your best staff in order to optimize chances of closing sales. During times that typically receive low visits, schedule less staff in order to save money on these low-shopper days.
Sometimes during busier seasons it’s necessary to increase store hours or offer an alternative time for shoppers to visit the store. This once hit-or-miss action can now be a data-driven strategy through the use of people-counting tech like the smart floor sensor. Based on the number of customers the store receives on a given day of the week, managers can tailor the store’s hours to meet the needs of customers. Whether it be shortening hours during the week and increasing hours on a weekend, or simply closing on a specific day and expanding on another, people-counting is a valid indicator of which days are optimal for business.
Every retailer must keep a clean record of their inventory. To optimize the ordering process, retailers are combining the foot traffic analytics with their POS data to identify trends in buying behavior over seasons. It’s important to understand the fluctuations in demand for consumer products so your inventory does not result in extremely high or low quantities. Like Goldilocks, you want it just right!
Projecting and optimizing each season for your small business can be perplexing, but it doesn’t have to be “pulling-your-hair-out” stressful. The right combination of analytics backed with proactive business management lays the foundation for executing effective seasonal strategies. Whether you’re looking to better schedule your workforce, improve stock to meet shopper demands, or align store hours with shopping trends, historical and real-time data provide solid answers to these questions.
Scanalytics is among the top 10 fastest growing “Internet of Things” companies, measuring human behavior insights through intelligent floor sensors. The SoleSensor platform translates consumer foot traffic into actionable data through a dashboard interface for real-time and historical viewing of trends in physical spaces. Using the floor sensor technology, brands capture and analyze occupancy, traffic patterns and engagement times to increase conversions and improve ROI.
With over 40 million impressions to date, Scanalytics has deployed SoleSensors across the United States, Canada, Mexico, Europe and Southeast Asia. Learn more at: www.scanalyticsinc.com.