In today's tough markets, retailers need to maximize a huge number of performance KPIs to remain competitive. The good news is that smart video can shine new light on performance across a wide range of operational processes, helping retailers make improvements that drive sales, minimize losses from shrinkage, and strengthen the bottom line, says Andrew Martin, Retail & Logistics Lead at Hikvision UK and Ireland.
Retailers constantly monitor a huge variety of performance KPIs, from footfall in store, to sales per square foot, sales per member of staff, conversion rates, and overall revenue growth. Driving performance across all these KPIs – and many more besides – depends on in-depth knowledge of customer needs and preferences, great product selection, optimal picking and stocking processes, and the ability to minimize shrinkage across the supply chain.
Of course, analysis of data from the POS and a wide range of other systems is key for understanding and addressing the root causes of performance issues. However, rapid innovation in the field of smart video technology is now providing an additional layer of performance insights that are helping retailers differentiate their in-store experiences, boost their conversion rates, and – ultimately – to differentiate their brands in the marketplace.
Specifically, smart video allows retailers to improve their operations in four key ways.
1) Boost sales performance with optimized product placement
Smart video allows retailers to see which areas of the store customers visit most often, and to understand which products are the best sellers. These two critical insights support far better product placement and merchandizing. Locating the most popular products in footfall 'hotspots' in this way means that customers can find the goods they want more quickly and easily, leading to greater overall sales revenues. What's more, the opportunity to cross-sell related products is also increased, leading to an incremental sales uplift.
2) Optimize the store layout to maximize conversion
With smart video, store managers can see, in vivid detail, how customers move around the store, and how the layout of aisles, fixtures, and in-store advertising can be optimized to improve the customer experience and drive conversion. Traditional data analytics can take retailers part of the way in terms of understanding in-store journeys, dwell times, and queuing times. By contrast, video data gives a clear and immediate view of the store, making it simple to understand and address issues that could impact sales performance. These range from poorly positioned displays, fixtures, and kiosks, to poorly placed in-store advertising or signage.
3) Ensure that the products customers want are constantly available
For all retailers, balancing customer service and routine tasks, such as shelf-filling, is a major challenge. With smart video, an alert can be generated in real time if stock levels for a particular product are low, allowing teams to restock shelves or displays quickly. Analysis of video data can also help stores to understand stock levels in store, and to communicate picking requests to distribution centers, ensuring that products always arrive in a timely manner in store, and always available for customers based on 'just-in-time' delivery best practices.
4) Minimize shrinkage to prevent losses and drive the bottom line
While driving sales revenues is the central KPI for retail performance, even a small reduction in shrinkage due to shoplifting can also have a major positive impact on the bottom line. Smart video solutions offer unique advantages in this area, generating alerts in the event of customers leaving the store with products from the store, without having made a payment. This is particularly valuable in semi-attended and unattended retail environments, where the majority of customers use self-checkout terminals to pay for their products before leaving the store.
How Hikvision can help retailers increase performance