Discover the potential of new locations to develop new markets and audiences using mobile GPS analytics to drive your expansion strategies.
A growing number of retailers, such as Primark, Asda and organic supermarket chain Alnatura, are on an expansion drive as sales start to return to pre-pandemic levels. However, even with improved consumer sentiment and a return of footfall to highstreets (as detailed in our previous blog), identifying the right locations for expansion opportunities is now more complex than ever.
Covid has changed shopping behavior and locations that were once deemed “good locations” now need to be reassessed. To do this, expansion managers need detailed data, beyond mere footfall statistics, such as catchment area, cross-visitation behavior and competitor analysis to identify the best locations.
But while gaining access to new markets filled with untapped customers offers an attractive opportunity to drive new sales growth, accessing the data to discover the optimum location can be a highly difficult task. The availability of data to back location decisions is highly limited, and the data that does exist is often inaccurate and outdated. This problem can be somewhat resolved by commissioning research and carrying out studies, but this is incredibly expensive and time-consuming.
Quickly and cost effectively analyze locations
The lack of access to accurate data to inform decision-making can result in retail expansion becoming an overwhelming puzzle. This often means expansion managers are forced to return to using old, unreliable methodologies and gut-instinct. PlaceSense solves this problem by delivering accurate and up-to-date data via its quick and easy-to-use self-serve SaaS platform. This provides the accurate insights expansion managers need to make informed, data-backed decisions or at least to use factual data to test their gut feelings and hypotheses.
The speed and ease which GPS data can be used to quickly and cost effectively monitor and analyze locations is a total gamechanger. It delivers visitor insights and analysis for any property, enabling expansion managers to generate actionable insights
by accurately analyzing the people who visit that location. This valuable tool means they can now easily identify and evaluate the commercial opportunities that best match their expansion strategy and check any of their existing hypotheses regarding footfall, catchment and other visitor data.
Unlocking new markets
While identifying Blue Ocean Markets is every expansion manager’s dream, in a world of highly competitive marketplaces it is getting increasingly difficult to find untapped locations. Thus this process can be a laborious task with little guarantee of success.
Using GPS data to conduct catchment area analysis, it is possible to quickly highlight locations with low cannibalization potential and minimal overlap with strong competitors. Using the PlaceSense platform, you simply choose a location, such as a highstreet or specific property, and you will instantly see the catchment areas where the visitors to that location live and work. This can be cross-referenced with the catchment areas of your existing stores and even those of competitors.
With this type of instant insight you can ensure you don’t expand too close to your current branches and cannibalize your existing customers. It will also mean you won’t miss out on unserved catchment areas. Using GPS data means all opportunities become easier to visualize, even in built up cities where you already have a presence.
Expansion Management Well Done
IKEA in Zurich offers a great example of successful catchment analysis and expansion management. It has two stores located in the city of Zurich in Switzerland, but despite their relatively close proximity, PlaceSense data shows they have two different catchment areas and a comparatively low cross-visitation rate of ~22%. This implies hardly any cannibalization between the two stores. This is a perfect example of expansion management well done.
Monitor location performance
Access to highly accurate visitor traffic has been catapulted to a new level with GPS data, making the monitoring of the performance of any location a breeze. This accuracy allows you to not only measure the number of visitors to individual retail stores, but how long they stayed, where they came from and where they went afterwards. This incredibly granular data automatically allows you to create a highly detailed understanding of visitors to a location, their journeys and habits.
PlaceSense, to show the power of such data, recently analyzed how shopping behavior on German high streets changed during the pandemic in the recent webinar, “High streets in crisis?” in partnership with Cushman & Wakefield.
Before the pandemic, of those that visited Hamburg’s Jungfernstieg shopping area, 63% also went to the Europa Passage mall, and 73% went to Mönckebergstraße. During the pandemic these percentages dropped to 54% and 60%. This type of information allows expansion managers to quickly analyze locations and specific properties, to get a precise understanding of visitor traffic patterns. Access to this data will transform your ability not only to understand the performance of specific locations, but how they rate compared to competitors. All of this data is on tap, and available when you need it.
Focusing on High-Potential Target Audiences
Discovering high population density levels that match the profile of your target audience is also at your fingertips using GPS data. For every location you assess using PlaceSense you will be able to see the associated demographic and socio-economic profile of the associated catchment areas, including age, gender, income, education level, professions and so on. This deep analysis means you can match high-potential audiences with the locations that can best service them.
Finding the best expansion opportunities does not happen by chance. Blending the experience, contacts and expertise of expansion managers with the power, accuracy and speed of GPS location-based data quickly transforms their ability to identify and assess new locations. With quick access to catchment area information, visitor traffic analysis, demographic profiles and other location based insights, expansion managers will be well armed to become the superstars driving their organizations growth strategies.
About Jan Barenhoff
Jan is Director of Business Development Europe at PlaceSense. He has a track record across multiple industries working to develop and build client relationships and opportunities. Jan holds a master’s degree from RWTH Aachen University.