Are retailers squandering store traffic?
Much has been written and said about declining traffic in brick-and-mortar stores. It continues to dominate the headlines and remains the most frequent reason cited for lackluster store performance.
At the same time, there’s plenty of evidence to suggest that, even when there is traffic in the store, retailers are failing to convert these opportunities into sales. It begs the question, how much better could stores perform if they focused as much attention on converting traffic as they do worrying about the lack of it?
Today, many retailers track traffic and measure conversion, but what do they do to optimize in-store conversion rates? The answer for many is not much.
Online, Conversion Rate Optimization (CRO) has become an industry onto itself, spawning a global community of consultants and service providers, formal methodologies and over a hundred books dedicated to the topic on Amazon.com alone. There is only one book (mine) on brick-and-mortar conversion listed on Amazon.
Given the difficult business conditions so many are facing, it’s baffling that CRO hasn’t become an obsession with brick and mortar retailers.
Some are starting to pay closer attention. Macy’s CEO Jeff Gennette recently said, “The key will be for us to convert — we’ll get the traffic.” And yet CRO remains largely unexplored. A startling number of major retailers don’t even track conversion rates, instead relying on sales transactions as a proxy for traffic.
In today’s environment, retailers can ill afford to squander the sales opportunities. Stemming the tide of store traffic declines may be difficult if not impossible, but it doesn’t prevent retailers from focusing on the opportunities and applying CRO strategies.
CRO is not a panacea, but it can go a long way in helping brick-and-mortar retailers deliver better results, despite traffic declines. And just like the online survivors of the dot-com bust, brick-and-mortar retailers need to realize that it’s not just about the amount of traffic in their stores, but what they do with it that matters most.
- Traffic Trouble: Store Traffic May not Come Back – What are Canadian Retailers Going to do About it? – Retail Insider
- Department Stores Change Tactics as They Lose Out to Screens – Bloomberg
- Study: How to boost store conversion and traffic – Chain Store Age
DISCUSSION QUESTIONS: Do you believe brick-and-mortar retailers could materially improve results by focusing on conversion rate optimization? What are the biggest conversion rate killers in physical stores and what can retailers do to minimize them?