The Profit Accelerator
Scale Your Customer Insights Framework with Techniques & Examples of In-Store Optimization – Advanced Course for Profit-Pros (Open Fall 2019)
The Physical Store is not dead. Shopping Malls are not dead. But retail is changing – fast! While topics in optimization vary per retailer (product positioning, fitting rooms, abandon behaviors etc.), the consistent theme is how to maximize the business benefits from data.
We don’t like the term “Conversion Optimization”. If you cut prices in half, your sales conversion will increase, but your profits will sink. We care about profits, and growth!
Here are common challenges:
- Apparel: How we identify the in-store journey per buying groups?
- Appliances: How we increase conversions in our flagship store?
- Department Stores: How we increase the average basket in cosmetics?
- Electronics: How we measure the productivity of our associates?
- Home Improvement: How we identify customers searching for home projects?
- Pharmacy & Health: How we prevent in-store abandons?
- Quick Service Restaurants: How we optimize the waiting time?
- Retail Banking: How we influence customers to buy more mortgages?
- Supermarkets: How we convince customers to enter the center store?
Optimization is a data-driven process. We put context to data, regardless of technology and solution providers. We use raw data from people tracking solutions such as Video and WiFi. We adapt Online Conversion Rate Optimization (CRO) techniques to physical stores. And we integrate Behavior Science.
The process of optimizing the InStore Customer Journey is Behavior Analytics.
Let me offer 3 insights:
- THE MOST SUCCESSFUL RETAILERS FOCUS ON ENGAGEMENT… THEY CONTINUOUSLY MEASURE CUSTOMER BEHAVIORS AND MONITOR PRODUCT POSITIONING
- THE MOST PROFITABLE RETAILERS DEVISE CONVERSIONS…. THEY IDENTIFY STEPS IN THE CUSTOMER JOURNEY AND NARROW THE CALLS TO ACTION
- THE FAST-GROWTH RETAILERS OBSESS ABOUT FRICTION…. THEY DESIGN STORES AND PROCESSES WITH THE GOAL OF PREVENTING ABANDONS
So… how do you turn these insights into actual profits?
How many of us are looking for a structured way to increase profits… to be more productive… to be able to identify challenges correctly, and quickly find solutions. What if you could do this?
Our research practice follows the PEACE Method for Profit™.
- People: Learn your audience based on consumer research and behavior science.
- Engagement: Capture how people interact with your products, service and layout.
- Abandon: Identify the points of friction inside the store and in the path to purchase.
- Conversion: Define “Calls to Action” based on business goals and the Customer’s Journey.
- External: Analyze winning and laggard stores, in context to the retail market.
The Profit Accelerator is based on actual projects. To protect the retailers and providers, the details are not available. Yet I wanted to share with you stories from the field.
- Demand Analytics: A retailer learned that fluctuations in weather (above 5 degrees) decreased footfall traffic, yet significantly increase the sales conversion and revenue.
- Mall Analytics: A shopping center saw significant increase in footfall traffic and leasing revenue from stores in the vicinity of the new Apple Store.
- Store Segments: When a retailer compared stores by segments (i.e. traffic, demographics, and conversion), they easily identified laggard stores. In 3 months, they experienced 10 points increase.
- Buying Groups: When we designed a framework for new products, the data pointed to returned visits when girlfriends shopped together. The Buy 1 Get 1 promotion netted 18% increase in sales.
- Local Demand: A supermarket redesigned the wine and beer department after a study of path analysis and customer flow. The new design increased annual wine sales by 24%.
- Customer Engagement: We assigned “Display Engage Levels” based on Stay Time optimization. The products below 70% were slated for clearance. Those above 90% were labeled as “trendy”.
- Call to Action Conversion: A department store assigned CTA targets to mirrors and calculated conversions by InStore Brands. The study resulted in redesign of the fitting rooms and service.
- Friction Points: An activity-based-costing analysis of stocking shelves in a supermarket led to changes, with an increase in associates and customer satisfaction, and decrease in payroll costs.
- Customer Service: An analysis of customer service activities led to changes in store operations and loyalty program, with direct increase of sales of over 10%.
- Purchase Points: A test of 3 product positioning options led to discoveries that increased product sales and reduced marketing promotions.
By far, the most common answer in the questionnaire y is that the objective is –
ACTIONABLE INSIGHTS TO STORE MANAGERS AND RETAIL EXCUTIVES!
Yet when I ask how you do it, most of you are stumped. Let me be crystal clear, the top retailers know how to test new solutions and processes in a way that traditional retailers do not.
This is why I’d like to introduce optimization into your life.
"Ronny was very helpful in guiding us through the learning of how to
leverage traffic counting metrics into our retail business. She is very
knowledgable with both the technologies and business analytics used to
leverage customer traffic counting systems to assist in labor
scheduling, product placement and customer behavior. these customer
insights resulted in business changes that delivered significant ROI and
improved oveall customer service."
"I have worked with Ronny for many years. She is deeply knowledgeable
about the Retail Analytics industry. Her insights have been invaluable.
She is easy to work with – highly responsive and highly pro-active. I
strongly recommend Ronny."
"I just wanted to drop you a line to say congratulations & well done on this initiative! It was a great session and insightful to get those other opinions and hear their challenges. Very interesting topics and a good mix. I’m so glad I signed up for your academy
- Alison Ashurst, CEO ASH Projects
Ronny Max is the founder & principal of Behavior
Analytics Academy and Silicon Waves Agency.
Ronny worked with 250 and more retailers,
brands, agencies, solution providers, technology startups, market research, venture capital, and research institutions on people tracking technologies, customer's journey projects, and in-store
Silicon Waves provides advisory, training, and consulting to C-Level Executives,
Investment Firms, Product Management, Customer Success & Direct-to-Consumer Teams.
In 2015, Ronny served as the
retail expert in Stanford University Vision Project.
In 2017, Behavior
Analytics Academy is born. The Academy provides on-demand online courses and live workshops on optimizing conversion rates and profits in physical retail.
Frequently Asked Questions
You’ll almost never hear someone in business say this:
Most of my material is not appropriate for everyone.
I learned this when I participated in the Stanford University Vision Project. I worked with some of the smartest people living today. Vision is a phenomenal machine learning technology. It can recognize a cat. It is the driver in driverless cars. It is the hidden hand beyond Facebook and Amazon. In Stanford, we tested vision technology in physical stores.
What I learned was that 10x technology MUST change customers habits. Think about Airbnb, Netflix, and Amazon. The common theme is obsessive attention to improving engagement.
I love the idea of starting a project with by focusing on behaviors. Retail is about PEOPLE. That’s why I don’t talk about technology. That’s the job of solution providers. That’s why I don’t do product comparisons or market analysis. There are better companies out there to do that for you.
If you think that all you need is technology, my courses are not right for you.
If you are looking for a silver bullet, this is not the place for you.
Optimization demands change. It requires learning how to work with data. It needs testing. It desires continuous feedback. It needs better communication.
Optimization is a team sport.
My goal is not to get the largest number of one-time customers. If I wanted to do that, I would have promised you a defined percentage of growth. But what’s the value of that? I want to help you change your organization - for life!
I want to give you the tools for growth.
Optimization is a numbers game. The metrics are building blocks. They provide context to the behaviors we want to measure and monitor. Key Performance Indicators (KPIs) offer insights to specific aspects of physical stores. Yet everything we do is subjected to the North Star.
The North Star Metric is the single metric that best captures the core value that your brand delivers to your customers. Optimizing your efforts to grow this metric is the key to driving sustainable growth across your full customer base.
Due to the complexity of physical stores, the North Star of a project is the code to Optimization.
I want to help you identify your North Star!