Retail
Do you know if your store is well located?
2021
Knowing how many people pass in front of your point of sale is much more important than it might seem. Knowing the number of pedestrians passing by every day allows you to make estimates on the profitability and, therefore, on the viability of the store and hence this data has a lot of value for the retailer.
If you do not know why you should know the number of people passing in front of your store or you are thinking of opening a new point of sale, we will explain why it is important to know this data, and what is the minimum number of people who have to pass in front of your store for it to be profitable.
This is one of the main problems when opening a store or a new establishment. The location of the store is one of the most important factors for success, which is why not just any location will do.
In physical retail, you can't segment customers in the same way as in the online world. In the online store, if I sell ties, I will have a male and adult target audience, and the best thing is that you will be able to attract that particular profile over others.
However, in physical retail, there is no such quality of segmentation. The more people that pass in front of your point of sale, the more likely you are to find your target audience and be visible to your potential customers.
Being in a good location means that more people will walk past, and therefore more people will walk in. Which translates at the end of the day into increased sales.
Being 5 minutes away from a busy street is the same as not being on a busy street.
Retailers often decide to open stores in locations with lower rents, where they won't have as many fixed costs. The problem is that, generally, the lowest rents are where the fewest people pass through.
Rents on main streets and avenues tend to have a price per square meter that sometimes doubles or triples the rent on secondary streets. But this is where the Cost per Potential Customer comes into play.
The Cost per Potential Customer in physical retail allows us to measure the cost we pay for each person who passes in front of our shop windows. It is calculated by measuring the price per square meter divided by the number of people passing in front of the point of sale.
This is useful for:
Not every street has to have the same pedestrian traffic on both sides of the sidewalk. Let's assume a street with a busy subway stop or station. Let's say we have decided that we want to locate our point of sale on this street because we know it has a large amount of pedestrian traffic.
Once set up, we realize that not as many people pass in front of our shop windows as they should. It may be that we have not taken into account that the sidewalk we have chosen is the least busy, since the natural flow of people takes a route that does not pass in front of our point of sale.
The same applies to shopping centers: it is not possible to consider that the flow data of the shopping center can be equated to all floors or all aisles.
In addition, when we talk about physical stores, having competition nearby is not a bad sign, since on the one hand the big brands tend to attract foot traffic naturally, and on the other hand the concentration of stores is usually an incentive to attract more people so that they can shop without having to travel far. This will increase the number of people passing in front of your store.
If we have a shoe store, being close to an Ulanka will make many people who come in search of shoes to this store decide to also pass by ours, benefiting from the proximity.
The number of people passing in front of your points of sale is the first relevant indicator. Knowing the pedestrian traffic allows you to have a real vision of the attractiveness of your business and therefore make decisions based on this data
If you want to know the number of people passing through a street, one option is to buy a manual counter and spend several days counting one by one how many people pass through a certain place.
If you want to know the number of people passing through a street, one option is to buy a manual counter and spend several days counting one by one how many people pass through a certain place.
Fortunately, there are tools like TC Street, with more than 10,000 counters installed around the world, with which you can obtain the pedestrian traffic in the section you are looking for to make decisions based on real data.
If you do not know why you should know the number of people passing in front of your store or you are thinking of opening a new point of sale, we will explain why it is important to know this data, and what is the minimum number of people who have to pass in front of your store for it to be profitable.
The location of the store: the most relevant factor for the retailer
This is one of the main problems when opening a store or a new establishment. The location of the store is one of the most important factors for success, which is why not just any location will do.
The best location to open a store will be where the most people pass by. The online world is not like the physical world.
In physical retail, you can't segment customers in the same way as in the online world. In the online store, if I sell ties, I will have a male and adult target audience, and the best thing is that you will be able to attract that particular profile over others.
However, in physical retail, there is no such quality of segmentation. The more people that pass in front of your point of sale, the more likely you are to find your target audience and be visible to your potential customers.
Being in a good location means that more people will walk past, and therefore more people will walk in. Which translates at the end of the day into increased sales.
Being 5 minutes away from a busy street is the same as not being on a busy street.
Retailers often decide to open stores in locations with lower rents, where they won't have as many fixed costs. The problem is that, generally, the lowest rents are where the fewest people pass through.
Rents on main streets and avenues tend to have a price per square meter that sometimes doubles or triples the rent on secondary streets. But this is where the Cost per Potential Customer comes into play.
The Cost per Lead (CPC)
The Cost per Potential Customer in physical retail allows us to measure the cost we pay for each person who passes in front of our shop windows. It is calculated by measuring the price per square meter divided by the number of people passing in front of the point of sale.
This is useful for:
- The retailer looking to open a new store, as he can study different locations based on foot traffic and CCP.
- The retailer who wants to know if the price he pays for rent is related to the number of people passing in front of his store (perhaps he is paying a much higher Cost per Potential Customer than he should).
Is a store located anywhere on the street worth the same?
Not every street has to have the same pedestrian traffic on both sides of the sidewalk. Let's assume a street with a busy subway stop or station. Let's say we have decided that we want to locate our point of sale on this street because we know it has a large amount of pedestrian traffic.
Once set up, we realize that not as many people pass in front of our shop windows as they should. It may be that we have not taken into account that the sidewalk we have chosen is the least busy, since the natural flow of people takes a route that does not pass in front of our point of sale.
The same applies to shopping centers: it is not possible to consider that the flow data of the shopping center can be equated to all floors or all aisles.
In addition, when we talk about physical stores, having competition nearby is not a bad sign, since on the one hand the big brands tend to attract foot traffic naturally, and on the other hand the concentration of stores is usually an incentive to attract more people so that they can shop without having to travel far. This will increase the number of people passing in front of your store.
If we have a shoe store, being close to an Ulanka will make many people who come in search of shoes to this store decide to also pass by ours, benefiting from the proximity.
Tools to count the number of people passing by on the street
The number of people passing in front of your points of sale is the first relevant indicator. Knowing the pedestrian traffic allows you to have a real vision of the attractiveness of your business and therefore make decisions based on this data
If you want to know the number of people passing through a street, one option is to buy a manual counter and spend several days counting one by one how many people pass through a certain place.
If you want to know the number of people passing through a street, one option is to buy a manual counter and spend several days counting one by one how many people pass through a certain place.
Fortunately, there are tools like TC Street, with more than 10,000 counters installed around the world, with which you can obtain the pedestrian traffic in the section you are looking for to make decisions based on real data.