It isn’t a stretch to say the digital age is synonymous with shopping from the comfort of your home. But where does this leave the footfall retailers are used to?
The reality is that many small businesses are facing a decline in foot traffic due to several factors. The internet, the rise of the ecommerce industry, and the decline of shopping malls have a direct effect on it.
Not optimizing for footfall can decrease your revenue and limit your opportunity to reach more customers. To know more about foot traffic and how it affects your revenue, you need to know about footfall.
In this blog, we'll be talking about what footfall is, why analyzing it is essential, and how to measure it.
What is footfall?
Footfall, sometimes referred to as shopper counting, store traffic, or people counting, measures the number of people entering a shopping mall or store.
Footfall is usually counted per hour, day, week, month, or year. Once you analyze your footfall, you can determine other vital retail metrics such as ATV (average transaction value) and conversion rates. Footfall can also be an indicator of a store’s overall financial health.
Importance of footfall analysis
- Inform staffing decisions
- Calculate retail conversion rate
- Compare store performance
- Measure effectiveness of marketing
- Evaluate training programs
- Identify consumer trends
Here’s a closer look at the importance of footfall analysis and what it can inform.
Inform staffing decisions
Foot traffic can be unpredictable—one day you wish for extra staff to handle the crowd, and the next day the only people you see in your store are your staff. So regulating your staffing needs is crucial.
By monitoring the changes in your hourly, daily, or weekly staffing needs, you can adjust and refine your staff schedule to improve customer service and decrease the number of disappointed customers.
For example, you have a shoe retail store specifically for children, and you have 20 people working with you in-store. By analyzing your footfall metric, you realize you don't need that many people.
So either you can reduce your staff or create a planned rotating schedule for them, such as one set of ten people on Monday and another set on Tuesday. This way, you can control your resources and still have access to the entire staff whenever you need them.
Calculate retail conversion rate
Knowing your retail conversion rate will help you in measuring your in-store performance. But to calculate your retail conversion rate, you first need to know about your footfall.
The retail conversion rate is calculated by dividing the number of people who make a purchase by your overall footfall analysis and multiplying by 100.
Drilling down on this will help you understand whether you need to invest in staff training or improve your in-store experiences.
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Compare store performance
If you have multiple retail stores, footfall is one of the crucial metrics you need to look at when measuring and comparing the performance of the various stores.
For example, if you know that some of your stores are consistently getting more traffic than others, you can dig into the reasons and apply similar ideas to your underperforming stores.
💡 PRO TIP: Analyze your POS data in tandem with your ecommerce data to be more cost effective with your inventory, measure your store’s impact on online sales, repeat purchases, lifetime value, and more.
Measure effectiveness of marketing
John Wanamaker once said, “Half the money I spend on advertising is wasted; the trouble is I don't know which half.” Marketing is tricky, and you need better and more precise metrics to uncover the underlying truth behind any successes or failures.
You can use footfall analytics to determine how successful a marketing campaign has been. If you see an increase in sales, for example, you can see if it was because of higher foot traffic or enhanced conversion rates. Footfall analytics also helps you determine how your company performs after the marketing campaign.
You can find answers to questions like:
- Does your foot traffic increase or decrease?
- Are shoppers staying in your store longer?
Evaluate training programs
According to a research report from Emerald, a company's cost of training in the year amounted to under €200,000. For every euro invested in training by the company, it received around €4 in return after costs were recovered.
This means the firm had a net benefit over the year of nearly €800,000. And this research was primarily based on footfall. If you have recently invested in training your staff, analyzing your footfall can help you determine if it was a success or not.
Identify consumer trends
Analyzing footfall data can also give you insight into consumer trends. For example, it can help you tell if your store attracts more or fewer people over time. This will help you figure out if you are close to your KPIs or if you need to adopt a new marketing strategy for the business.
💡 PRO TIP: Only Shopify POS unifies your online and retail store data into one back office–customer data, inventory, sales, and more. View easy to understand reports to spot trends faster, capitalize on opportunities, and jumpstart your brand’s growth.
How to measure footfall?
- Beam systems
- Thermal sensors
- Smart mats
- Video counting systems
- Manual counting
There are various ways you can track and analyze your footfall. We have divided them into primary categories, technology and manual counting systems.
Before you can analyze the footfall of a retail store, you need to be able to track foot traffic. Here are some ways to leverage technology to track your foot traffic and convert it into footfall analysis.
Install beam counters comprising two elements—the transmitter to emit the laser and the receiver to detect the laser's presence.
When people pass by, the beam connection will interrupt, increasing or decreasing the count. It is an affordable and easy-to-install solution that helps you easily keep track of footfall.
Thermal counters use body heat to track footfall. If you install it overhead at an entry, it provides you with a simple people count. But if you want to track the movement of people throughout a venue, you will need to install it throughout the store. One of the significant disadvantages of using thermal sensors, however, is that they can sometimes fail to distinguish between individual people as they move in closer groups.
A turnstile uses a gate with a rotational barrier to count people. As a person walks through a turnstile, the barricade rotates and adds the person as a visitor. It is a very accurate technology and can also serve as a security barrier.
You can also use smart mats to track customers. They work with pressure sensors placed in floor mats, so whenever someone passes over the mat(s), they are added as a visitor. Smart mats count anonymously and don't disturb the shoppers.
Apart from simply counting how many people are entering your store, you can also gain insight into their movements.
Video counting systems
Video cameras can provide you with the highest accuracy level and are an advantage over other methods.
For example, if you install video cameras at the entrance of your store, they will measure the overall number of people who visit. If you add video throughout your location, you can track the number of visitors in specific areas and their movements within the store.
And finally, manually counting people as they come in will never go out of style. While it may not be the most accurate and convenient way to keep track of footfall, it is a very easily accessible one.
How to increase footfall
- Leverage loss leaders
- Local marketing campaigns
- Add relevant seasonal messaging
- Optimize store staffing
- Host in-store events
Here are a few suggested ways to help increase footfall in your store(s).
Leverage loss leaders
Costco’s rotisserie chickens at the back of its warehouses are a great example of leveraging a “loss leader” —a product sold at a loss to attract customers—to bring in additional sales.
Stores like Costco and Sam’s Club have managed to sell their rotisserie chickens at $4.99 for more than a decade. It increases member loyalty and keeps them coming back for more–and stores can count on the extra sales consumers invariably make on their way to pick up a fresh chicken.
You don’t have to be Costco to experiment with a loss leader. What’s an item requiring recurring sales your store could afford to sell at a lower price and which would keep customers coming back for more?
Once you identify a loss leader, it can do a lot in increasing footfall.
Local marketing campaigns
The power of social media, it’s become easier than ever to create local marketing efforts at little to no cost. Assuming your store has relevant social channels, and that you’ve made an effort to grow them and engage with your audience over time, consider using them to run local marketing campaigns.
Creating posts, adding stories, or uploading Instagram reels helps keep your retail store top of mind and finds your customers where they’re already hanging out—on their phones.
Local marketing campaigns will vary from store to store. Local marketing can look like:
- Running a back-to-school sale targeted at parents
- Launching targeted local Facebook ads
- Leveraging local newsletters to spread the word about special offers
- Leveraging your own email newsletter to inform your customers about current sales
💡 PRO TIP: With Shopify, you can get your products found by more nearby shoppers looking for what you sell on Google. List your products on Google for free, show pickup availability to increase store visits, and measure how your listings impact store sales from Shopify.
Add relevant seasonal messaging
Nobody likes boring, and this applies to retail stores as well. When the consumers’ alternative is to shop from their couch, lure them in by adding relevant seasonal messaging: signs, store decorations, or even music.
As an example, take the Toys“R”Us experience, which is making a comeback in Macy’s stores. The experience of walking into a Toys“R”Us is memorable, and something you don’t get with online shopping.
You can leverage seasonal decor and messaging to amp up your own store and make it appealing. And you don’t have to be a huge department store to pull it off.
Optimize store staffing
In creating a welcoming environment for customers, consider one of your most valuable assets: your staff!
Making sure your staff is properly trained to deal with different customer scenarios, as well as best practices when interacting with customer inquiries or checkout processes, is a key part of running a healthy retail business. It invites footfall on its own without the need for any additional heavy lifting.
Host in-store events
Contests, holiday popups, or sponsored in-store events are all ways to increase footfall. Special events open the door for consumers that wouldn’t otherwise step into your store, and give them a chance to familiarize themselves with your offers.
The more in-store events you host, the more you can count on increased footfall and the subsequent sales that come with it.
Start counting footfall at your store
Footfall can be an indicator of your store’s overall health. Fortunately, there’s plenty retailers can do to keep footfall rates more or less stable through the year. Once you’ve implemented a few strategies and see what works, you can work special offers, promotions, and sales into your retail schedule as the seasons come and go.
Turn store traffic into sales
With Shopify’s mobile POS, you can serve customers anywhere in your store and banish lineups at the checkout counter. Use any smartphone or tablet to process returns and exchanges, accept payments, and check out customers wherever they are.