Improving store performance can be achieved in many ways, such as understanding consumer behavior, analyzing shopping habits, studying demographics, and other influencing factors. With the help of location analysis, this data can be processed into valuable insights that guide strategies to enhance store performance. Â
In this article, we’ll explore how location analysis helps businesses optimize their store performance. Â
Contents
What is Store Performance? Â
Before diving into how location analysis can improve store performance, let’s define what store performance and location analysis entail. Â
Store performance refers to evaluating and monitoring how a store operates and performs in terms of sales and customer engagement. This process allows businesses to assess the effectiveness of their sales strategies, identify areas that need improvement, and gauge the store’s success in selling products. Â
By analyzing store performance, businesses can identify potential risks, improve sales forecasting, set clear sales benchmarks, and make more informed business decisions Â
Understanding Location Analysis Â
Location analysis is the process of collecting and analyzing geographic data to gain valuable insights. This analysis typically includes factors such as demographics, psychographics, customer behavior, foot traffic, and other relevant data. Â
The results are often displayed visually through graphs, charts, and tables, making it easier for businesses to identify patterns, trends, and relationships between variables. These insights are then applied across various company functions, such as opening new stores, managing customer relationships, optimizing assets, and more. Â
How Location Analysis Enhances Store Performance Â
Location analysis can be a powerful tool for achieving different business objectives, including boosting store performance and sales. Here are four ways location analysis helps businesses optimize store operations:Â Â
Gain Insights to Boost Marketing Effectiveness Â
Location analysis provides businesses with valuable data about consumers, including their demographics, locations, income levels, education, interests, and time spent in certain places. Â
When processed and analyzed, this data reveals patterns or trends that highlight consumer preferences and behavior. These insights can serve as a foundation for designing more targeted and effective marketing strategies. Â
For instance, consider an F&B business that wants to better understand consumer preferences and foot traffic around its stores. By leveraging location and transaction data, the analysis can reveal details such as the number of visitors, best-selling products, peak hours, and more. Â
Armed with these insights, the business can create tailored promotions, adjust staff schedules, optimize operating hours, and refine its marketing approach. Â
Support in Setting Sales BenchmarksÂ
Sales benchmarking involves comparing the sales performance of one store with others. Unlike comparisons with competitors, location analysis focuses on internal benchmarking, evaluating how one store performs relative to other outlets owned by the same business. Â
This approach allows businesses to identify which locations are performing well and which need improvement. Additionally, location analysis highlights positive and negative factors affecting store performance, offering actionable insights for improvement. Â
For example, if a store is underperforming due to low foot traffic or a suboptimal location, businesses can use this information to implement new sales strategies or consider relocating the store to a more promising area.
Suggesting High-Potential Locations Â
Location analysis leverages demographic data, points of interest (POI), competitor presence, foot traffic, risk factors, and accessibility to recommend the best areas for opening new stores or relocating existing ones. These recommendations are tailored to align with the business’s target market. Â
For instance, if a food and beverage business is looking to expand, they may prioritize busy areas near offices, educational institutions, or high foot traffic zones. With location analysis, they can quickly identify locations that meet these criteria, simplifying the decision-making process. Â
Identifying Store CannibalizationÂ
Location analysis helps businesses determine whether their stores are unintentionally competing with each other, also known as cannibalization. If this issue is detected, businesses can strategize by closing or relocating one of the stores to ensure both outlets operate optimally. Â
In addition to identifying cannibalization, location analysis evaluates each store’s coverage area, providing insights into potential sales performance. This allows businesses to set realistic sales targets for future periods.
Track and Monitor Store Performance with LOKASI Intelligence Â
LOKASI Intelligence is a geospatial data and analytics platform designed to help businesses easily track and monitor their store performance. With this platform, businesses can gain valuable insights, such as transaction details, high-performing and low-performing stores, factors affecting sales, sales potential in specific areas, foot traffic, and much more. Â
Discover how LOKASI Intelligence can empower your business by reaching out via email at [email protected] or WhatsApp at 087779077750. Â
FAQs Â
What is meant by store performance analysis? Â
Store performance analysis is the process of evaluating and identifying a store’s performance to understand the conditions and factors that impact its success. Â
What is location analysis? Â
Location analysis involves collecting and analyzing data related to geographic locations to uncover patterns, trends, and insights that support business decisions. Â
How does location analysis help optimize store performance?
Location analysis helps optimize store performance in four key ways: Providing insights to improve marketing effectiveness, helping to create sales benchmarks, recommending more potential locations, and offering insights into store cannibalization. Â