84.6 F
Tuesday, July 27, 2021

IO Report: Store Wi-Fi ROI

Store Wi-Fi ROI

Wi-Fi data analytics help justify the cost of ‘free’ Wi-Fi

By: Martin Vilaboy

[Excerpt from Inside Outdoor Spring 2016]

It’s been said that in-store Wi-Fi is a linchpin to omni-channel retail. That’s because this relatively mature and standardized technology platform connects the customer’s digital presence (via their smartphones) to the physical storefront experience. All the while, the “free” Internet access provided by guest-host Wi-Fi has almost become expected by consumers.

Still, only about a quarter of retailers recently surveyed by Retail Systems Research had Wi-Fi available for employees on the selling floor, and just 19 percent had wireless available for customers. A survey by IHL Group, which notably included the hospitality sector, found that only four in 10 respondents had Wi-Fi at the store level.

“We still don’t have enough Wi-Fienabled stores,” blogged Paula Rosenblum of Retail Systems Research.

One good reason for the slow creep in deployment is that while the word “free” is often associated with “Wi-Fi access,” providing customers with guest-host Wi-Fi is anything but free. A sufficient local area network, after all, requires hardware, cabling, security, design and installation. That can easily run as high as several thousand dollars for the largest of sporting goods stores. And that doesn’t even include the monthly recurring cost paid to an Internet service provider.


In other words, that’s some serious coinage to justify what is typically seen as a passive amenity deployed mostly as a customer experience value add. But what if retailers could derive more from “free” Wi-Fi and its enabling local wireless infrastructure? Brent Baker, manager of network services at Powernet, a Cincinnati based business connectivity provider, believes retailers can leverage basic data gathering and analytics from their Wi-Fi networks to actively improve store operations, enable personalized marketing and customer service and directly drive sales. Powernet’s Beyond Wi-Fi solution, for one, makes Wi-Fi analytics accessible to the budgets and IT capabilities of mid-sized to large sporting goods and outdoor chains. The upshot: customers get an enhanced experience, store executives get a path toward the holy grail of connecting with customer across “all touch points,” and CFO types get their ROI.

To understand the importance of Wi-Fi inside the store, one only needs to take a gander at in-store shopper behavior. Quite simply, the smartphone changes everything.

Despite the relatively recent ubiquity of smartphones, about three-quarters of nearly 23,000 online shoppers surveyed by PwC report to using a mobile device while browsing in-store. Among those, more than a third are comparing prices with competitors or researching products, while more than three in 10 are accessing coupons or promotional codes. Not surprisingly, Millennials (aged 18 to 34 years old) are more likely to engage in these activities than older adults. They are 35 percent more likely to compare prices, 43 percent more likely to research product and 38 percent more likely to access discount offers. Within the U.S., more than eight in 10 Millennials use their mobile devices while in-store.

DigitalA separate study by Deloitte, meanwhile, estimates that mobile influences 28 percent of in-store sales around the globe, with the U.S. leading in terms of this digital influence among the six mature markets studied. At the same time, consumers tell Forrester researchers that they also want store associates to be digitally enabled. More than seven in 10 say it’s important for store employees to check store inventory when a shelf is empty, while 67 percent want associates to be able to look up additional product information. More than half of shoppers expect employees to be able to look up and reserve inventory at a nearby store.

“Millennials play a large role in the in-store shopping revolution, as their smartphones are basically an evolutionary extension that the retail industry has yet to catch up with,” says Patrick Connolly, principal analyst at ABI ResearchImpacts

“The conceptual battle between brick-and-mortar versus online is dead. All retailers must become omni channel and harness the power of the smartphone by developing next generation, personalized experiences.”

RELATED: Game Changers: Rubber Cycles Up

By providing a Wi-Fi experience, retailers put themselves in position to control the in-store shopper’s digital experience. That can be done through a simple landing and log-in page that shoppers must cross to access the free connectivity. Here a retailer can push offers and content or highlight in-store services that discourage shoppers from searching competing offers.

“This page is your first opportunity to present a message to the customer,” says Baker.

Of course, that is just a beginning. Analysis of the Wi-Fi and locationbased data also can provide insight into how, who, when and where shoppers interact with in-store environments and merchandising campaigns. What’s more, “these new technology platforms tend be inexpensive to deploy when compared with more traditional measurement instruments such as traffic-counting devices and video observations,” note researchers at the Platt Retail Institute.

Retail’s ROI

Consider, for instance, “what it would be like to have insight into every one of your visitor’s Facebook pages?” says Baker. Powernet’s Beyond Wi-Fi service allows shoppers to log-in via social media, providing retailers access to those profiles.

“How much do retailers really know about the people who walk through their doors?” asks Baker. “They know they have some connection or interest in the product they are selling, but they don’t know what type of music they listen to, the personal relationships they value, other interests or any number of things they might be able to learn from someone’s public social media profile.”

Armed with such information, retailers not only are prepared to build a profile around who is coming into their stores, but it also allows marketers to better tailor direct marketing, such as SMS messages or email offers, personalized to individual’s interests or demographic profiles.

“Maybe I want to encourage them to come back with a coupon or information on a special event that’s really targeted at what I know their interests are based on their social media profile,” explains Baker.

For those who might be creeped out by what they could consider a form of “social media stalking,” Beyond Wi-Fi also allows users to login through the more-standard, just-give-us-your-email option. Armed with just that information, a store manager could run a report, see who was in the store that weekend, for example, and trigger a comeback offer, depending on what a customer did or did not buy.

Analytics“It’s about marketing the right thing to the right people,” say Baker. (Messaging could even be delivered in real-time, while a customer is inside the store, although that would require a staff member actively monitoring the Beyond Wi-Fi portal in real-time to send the message.)

Even when a customer chooses not to opt-in but rather foregoes use of a store’s free Wi-Fi, there is a pretty good chance they are carrying a smartphone. And if they are carrying a smartphone, there is a pretty good chance their Wi-Fi function is turned on, several studies suggest. That’s all Beyond Wi-Fi needs to provide valuable feedback on customers’ in-store activity.

“If a Wi-Fi device comes through the door, even if the user doesn’t log-in, we’re still going to track it,” explains Baker.

Since Beyond Wi-Fi tracks the location and movement of every Wi-Fi-compatible device on the floor, retailers can compile and monitor information such as footfall, traffic flow or where folks are congregating, in real-time or at any one point in time. Through analysis of that data, a store manager can gauge how well displays or end caps are engaging customers, at what times there areInfrastructurechoke points at check-out, if stimulus in one part of the store is moving traffic to another intended
part or how well a promotional or advertising campaign boosted foot traffic. Product placement and assortment can be improved based on dwell time measurements; while in a mall environment, the data can be applied to measure and improve store penetration rates. Watching for repeat visits, meanwhile, can provide better understanding of out-of-store marketing campaigns or help estimate product purchase cycles, while tracking customers along a path through store aisles can highlight optimal points to coordinate engagement.

Traffic data also can aid with staff availability, such as helping to match staffing and breaks to customer counts or better position staff to improve customer service. Ultimately, depending on the amount of time given and the gumption of the user, the possibilities to impact store operations seem almost limitless.

“You can really expand on the ‘put the milk at the back of the grocery store’ strategy,” says Baker.

RELATED: Is Your Return Policy Hurting Your Business?

Things get even more interesting when Wi-Fi and location-based data is integrated with other data and systems, such as point-of-sale, human resource management or marketing automation. Most Wi-Fi analytics suites, including Powernet’s Beyond Wi-Fi, offer Web APIs (application programming interfaces) that allow data to be exported and combined with other systems.

“The sky and your programming skills are pretty much the limit,” says Baker.

Imagine, for instance, a customer a retailer knows by name (or at least by screen name) comes into a store and is instantly greeted with a personalized message or offer.Ways Say that customer comes in, lingers around the trail shoe wall for some time but leaves without visiting the cash register. A manager reviewing the day’s traffic can see that behavior and initiate the push a coupon out to that customer offering 15 percent off all footwear. Or say a customer comes in and purchases a climbing harness. As she walks out the door, a digital display could flash information about an upcoming in-store climbing clinic or guest speaker on the topic. Welcome to the future of retail.
“By 2025, we will be exposed to a new shopping world in which the value of a physical store will no longer be measured in sales, queuing will not exist, any surface will be a storefront, customers will be able to find and buy any item at any time, and clothing will be shared, tried on virtually, and printed at home,” says ABI Research’s Connolly. “The path to the future should start today for smart retailers.”

A basic Wi-Fi data analytics suite provides retailers with a good first step on this path, while at the same time having an immediate positive impact on customer experience and in-store operations. Not bad for something that’s considered “free.”



About Inside Outdoor Magazine:

We know outdoor executives have access to plenty of instantaneous information. But one thing decision makers overwhelmingly tell us they can’t get enough of is thoroughly researched and highly scrutinized news and analysis that can be applied directly to improving day-to-day operations.

Having surpassed more than a decade in the industry, Inside Outdoor Magazine’s staff of seasoned outdoor journalists represent years of experience in specialty retail, product manufacturing, business analysis and living the outdoor lifestyle. We believe this mix of backgrounds is a key component to complementing your marketing message with the business modeling, cost-margin analysis, trend forecasting and quantified operational advice that’s already proven to capture loyalty and engage readers, and studies show that reader engagement with media and advertising can drive sales.

Your customers would need to expend significant time and money to amass the information and advice, in addition to, the requisite industry movements, trends and product innovations—that we deliver straight to their mailboxes, for free, all year round.

Related Articles