To ensure the success of branch expansion strategies for site selection plans, it’s necessary to compare the business model with the the potential market needs and build the corresponding strategy, location and foot traffic analytics are the best tool to do so.
Location data gives retailers a competitive advantage in site selection by helping to visualize how local market dynamics have changed over a long period of time, uncovering new opportunities and insights in real time that would not necessarily have been evident through more traditional or one-dimensional data sources.
Location analytics gives insight into whether a business will succeed in a given area, by mapping key area demographics, buying habits and competitor locations, it is possible to identify where there is active demand for any given product or service.
Also Read: “Predictive modeling for site selection strategies“
Using location analytics to create a market area profile minimizes the risks of failure by helping to integrate your business into the needs and buying habits of an area, can give you a competitive advantage and ultimately avoid costly mistakes.
Location intelligence can help you determine which strategy is best for your business. Location data provides access to qualitative and quantitative information about the context of a given area allowing you to:
- Penetrate new territory by identifying the concentration of target customers in a particular area. You can also check the possible cannibalization of this area with your competitor’s location.
2. Develop a franchising strategy or create a chain by providing the ideal catchment area by ensuring that the outlets have the same market shares, and high penetration rates.
3. Launch a new product by observing the level of spending and consumer habits in the targeted areas, determining whether or not it is worthwhile to launch a product in this new market, providing behavioral data patterns that can focus future expansion and growth.
4. Define a new pricing strategy by studying the spending habits and average income of the inhabitants of a potential area.
5. Identify strategic alliances and new segments and others by obtaining quantitative and qualitative information on pedestrian traffic in the areas.
- Evaluate POS performance and behavioral trends by extracting trends from branches and stores, and analyzing a range of existing customer data and modeling market trends.
7. Use machine learning algorithms and model future location priorities, tailoring a unique approach to market choices over the next few years, both regionally and at the micro level.
- Strengthen online engagement by reinforcing segmentation campaigns, identifying previously untapped audience groups and increasing engagement with the brand.
9. Implement Geofencing Marketing and identify populations that have visited similar stores and develop targeted ads for that niche.
10. Gain a competitive advantage by knowing who visits your competitors’ stores and how often, revealing how best to encourage those consumers to engage with your brand instead.
Location data is revolutionizing the retail sector for the better. Not only can it help retailers assess market dynamics and identify the best places to set up store, but it can also enable them to run more targeted and effective promotions while creating better in-store experiences that drive customer loyalty and maximize revenue potential.
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