There’s a great article in the Wall Street Journal about how yoga clothing retailer Lululemon is experiencing phenomenal ($1,800 in sales per square foot) success by not following the CRM crowd. When most retailers are clamoring for more data about their customers, Lululemon is instead trying to get a firsthand understanding about their customers’ experience in the store. According to the article Lululemon’s CEO Christine Day,
spends hours each week in Lulu stores observing how customers shop, listening to their complaints, and then using the feedback to tweak product and stores. “Big data gives you a false sense of security,” says Ms. Day, who spent 20 years at Starbucks Corp., overseeing retail operations in North America and around the world.
This idea that big data doesn’t give the full story has been a central tenant of Envysion since our inception. Having lots of data, or video for that matter, does not improve your business. To drive any improvement, you have to be able to use the data. Data alone only provides trends, correlations and theories (which take time to develop) into what is happening in the store. To maximize growth and profit, retailers must be able to rapidly and intelligently adjust strategies based on changes in actual consumer behavior.
That is where a firsthand look into the store is essential, as Lululemon is proving. For example on one store visit, Day realized that customers were not happy with the fit of the sleeves on a new sweater and cancel all future orders before the company was stuck with stock it’s customers did not want. Retailers solely focused on collecting data could have waited months for the data to indicate that the sweater was not selling as well as expected – too late to cancel restocking orders.
While Lululemon’s approach is obviously working for them, it’s not really a scalable approach to send your CEO to hang out in your stores. That’s where video comes in. Many stores already have surveillance in the store, but only a handful of security users can access it. Imagine the insights you’d glean by observing your stores remotely. What if instead of traveling to a different store each week, Day used video to remotely “visit” five or ten stores over lunch every day? How much more effective could your promotions be if your marketing team could actually see the demographic makeup of customers at a particular store and how customers interacted with sales displays? How would you improve sales, if you could watch your best and worst sales associates try to cross sell customers?
Leading retailers are doing just this. To learn more about how best-in-class retailers are using video to get the full story behind the numbers and gain valuable insights into store operations and the customer experience, check out our latest white paper – Harnessing Big Data to Gain Competitive Advantage: A How to Guide for Brick and Mortar Stores