Businesses in Dubai and all around the UAE are considered to be more adoptive towards innovation and modernization. This is because of the overall market conditions. Especially the service and retail industries are one of the most rapidly growing industries in the UAE. The biggest challenge for such industries is that the competition is always high, the consistent growth always attracts more businesses and investors, and hence the competition starts getting tougher. With the rise of competition the offering businesses made to their customers also start increasing, which eventually raise the customers’ demands and market standards.
In Dubai and all around the UAE the customers are already very demanding, they prefer experience over cost. People are willing to pay extra if they are provided with a better customer experience. The customer experience matters so much so that an average consumer puts customer experience equally to the quality of the product or service. For customers the product/service quality and experience are both equally important.
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Businesses always strive to improve the quality of their products and services, there are many ways to deal with this problem. However, customer experience is a very complex and sophisticated problem. The customer experience is basically customer response towards the products, services, purchase process, interactions with the business, and the entire customer journey. If a customer have positive response, or they feel better after interacting with a business, they tend to come back and make more purchases from it. If anything goes wrong, the customer leave unsatisfied and unhappy, they will most likely never return to the same business.
That is why the customer experience is extremely important. If we talk about the retail businesses, there are tons of options available for an average consumer, if we talk about the service industry the conditions are almost the same. This really empowered the customers, they have power to choose any business they want. On top of that the rise of e-Commerce and online channels the customers have even more options than ever before.
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It has become extremely important for businesses to offer an excellent customer experience along with high quality products and services. In order to understand the customer experience the customer journey is the key. The customer journey is the entire processes that starts with customer acquiring information about products or services, interacting with the business, making a purchase/checkout and even post-sale services. These all touch points in totality form the customer experience. In this blog we will discuss how businesses can use people counting system and heatmap analysis to understand and reduce their customer churn rate.
What is customer churn rate?
The customer churn rate is a rate at which customer leave without making a purchase or a rate at which customers unsubscribe from the service within a certain time period. Basically the customer churn rate is heavily influenced by the customer experience. Let say in case of a retail business the customer churn rate would be the measurement of the customers who happen to visit your store but left without making a purchase. Of course there are some window shoppers too, but the most of the customer who left without purchasing is due to the experience, they might suspect they will have to wait for a long time in the queue at cash counter, long waiting time could be very stressful for some customers.
That is why they decide to leave without making a purchase and in that case usually those customers end up purchasing from another store. Similarly in service sector the customers usually left without getting the service is due to the long queues at the service counter. The rate at which customers are leaving the business without having a transaction is basically the customer churn rate.
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What is People Counting System?
The people counting system is a digital solution that counts people entering or leaving through a door, entry point or passage. The people counting systems have evolved a lot over the past few years. The people counting phenomenon is not new, in fact businesses are doing it since a long time, in the very beginning usually a staff member was appointing on counting people manually, he/she sits at the entrance or exit and count people manually. This means that businesses have realized the importance of people counting at very early times.
Later on when the technologies start evolving and electronics and IT technologies have become popular, businesses started implementing technology based people counting systems. The earlier people counting systems were just basic ones with an infrared sensor and emitter, whenever someone passed through the door, they cut the beam and the system add one to the counter. Later this become more advanced and replaced by dedicated devices and sensors who offered better accuracy such as infrared cameras, ultrasonic and laser technologies, etc.
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However, the accuracy of the system was still not up to the mark. That is what made businesses think of something more innovative, sophisticated and accurate solution. The people counting systems have evolved a lot over the past decades, however, in the last decade, with the rise of artificial intelligence (AI), machine learning (ML), more sophisticated algorithms and powerful software applications, the modern day AI based people counting systems have emerged. A modern AI based people counting systems are equipped with highly advanced image processing algorithms who can detect various different objects and who can accurately distinguish between the surrounding background and moving people.
This made them highly accurate and also comes with additional benefits. The modern day AI based people counting system doesn’t even require a dedicated sensor, in fact with its powerful software it can turn any camera into a highly accurate people counting sensor. The modern people counting system is completely a software based solution which can be linked to existing CCTV camera feeds, and from that feed it can extract the valuable people counting data and other analytical stats which offer a great value to the business.
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What is Heatmap Analysis?
The heatmap is a very useful feature of the people counting system. Basically the heatmap is a visualization of the movement of the customers and visitors within your tracking region or premises. It tells businesses from which point the customers enter, how they moved inside the business premises what attractions attracted them the most, how much time they spend at any place in the premises, where they make the purchase, or where the abandoned the customer journey and leave. Basically the businesses wants to know which places or points are acting as the bottle necks, and which are acting as the honeypots for the customers.
The heatmaps are a color coded visualization of the analytical data collected by all connected cameras within the premises or coverage area and place that on a 2D or 3D floor plan of the premises. It can track the popular and unpopular pathways and routes customer take within the premises during their visit. That kind of information is very helpful for businesses, it helps them understand which products, places, or attractions are popular among their customers and vice versa. The heatmap analysis is one of the most important aspect of the modern day people counting system.
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How People Counting System’s Heatmap Analysis Help Reducing Customer Churn Rate
The customer churn rate can only be reduced if the business clearly understand its causes and then take actions to eliminate those reasons. In a service center or retail setup where customer footfall is high, it is difficult to understand the customer churn rate. Here are a few sample questions that you can ask yourself during the heatmap analysis to understand the reasons of the customer churn rate:
- Are customers going to the important products/sections?
- Are customers reaching out to the offers/deals, or high selling items?
- If marketing stands and screens are distracting customers from going to the high-selling items?
- Are customers waiting longer in the queues?
- What is customer dwell time at the cash counters or service counters?
- What is customer dwell time at important places/spots?
- Which areas customers are not visiting or spending time at?
- Where are the employees deployed when the crowed formed at the counters?
In order to reduce the customer churn rate, it is important to understand the customers get what they are looking for. In any businesses, not every product is equally popular, some sell more some less. In fact sometimes there is only a short list of the products that are top selling. It is important that the customers reach to those products and those places where you want them to go.
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Furthermore businesses adopt to different strategies and marketing tactics to improve customer experience. However, you can’t force them to go to those products or areas. The heatmap analysis will help you understand the customer behavior within the premises and it will help you understand the customer flow and pathways. With that knowledge in hand, you can rearrange your inventory to increase the visibility of the high-value and most selling products to maximize the sales. Businesses keep installing digital screens and other marketing materials which could distract the customers from the important items or areas.
Another huge cause of customer churn is the long waiting lines and longer time spent at the cash/service counters. Most of the times in shopping malls and at service centers due to inefficient management the facility is always operating at lower than its actual potential. The people counting system help businesses understand how to strategically allocate resources during the busy time. The customer dwell time and heatmap is very helpful in understanding the busy hours, customer wait time and customer queues.
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The people counting system also track employee movement which can portray a clear picture of employee positions, movements and their work patterns within the premises, which can be very helpful for the management to efficiently manage resources to maximize the customer experience. Furthermore businesses also want to know why there are some sections or places which customers are not visiting, the heatmap can provide a full customer movement analysis with visualization on an actual 2D/3D floor plan of the premises. This help businesses understand which areas are not attracting the customers and why.
Businesses can take some steps to improve visibility of such areas such as by marketing, or shuffling of some products and so on. The people counting system is also very helpful in improving the marketing campaigns, for example, if a business added a new standee, a banner, a digital signage or even an interactive self-service kiosk, they can understand how customers and visitors are responding to that. If customers and visitors start showing interest in it, then it is good and same can be followed for future campaigns, if not, businesses can revamp their marketing content, until they get the desired result.
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The heatmap analysis and all its advantages are excellent in reducing customer churn rate. Businesses can easily understand what customers are liking and not liking, they can understand their behavior and movement patterns within the premises, they can get valuable information about the queues and customer waiting time and much more. The people counting system not only provide heatmap but also provide other useful information such as your customers’ demographic data which is also very helpful. Businesses can make informed decisions on the bases of the people counting system data and heatmap analysis.
For example, they can better manage their internal space, they can maximize the visibility of the products they are selling, they can streamline their customer flow in their service centers, they can track and analyze the employee performance and they can easily highlight the areas of improvement with the help of the data. Hence rather than making your strategies based on guesses or incomplete data, they can take decision on highly accurate data. Which maximize the chances of the success. The customer churn is a very complicated problem, but with the help of the heatmap analysis and business intelligence data gathered by the people counting system businesses can easily reduce it.
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Conclusion
High customer demands, tougher competition and complicated management, lead businesses to lose their efficiency. For profitability and growth it is important that a business operates at its full potential and doesn’t lose any sales opportunity. The customer churn could be very damaging for the business, it not only cause loss of sales but in long term it impact business’s reputation and image as well. The people counting system is one of the great tool to understand your customers’ behavior and track their movement within the business premises. A modern people counting system is based on artificial intelligence (AI) based image processing algorithms which enables it to extract valuable business intelligence data form the CCTV camera feeds. The data along with the heatmap provide vital information about customer behavior and their movements. Which areas are most visited, which areas got least attention, how much time was spend at counters and in queues, etc. The heatmap can also track employees which help management understand employee performance.
All this data is very helpful in identifying the bottlenecks and honeypot areas, and also help businesses evaluate their resource planning and marketing strategies. With the data from people counting system and heatmap analysis the businesses can take more informed decisions, they can refine their strategies to enhance customer experience and to reduce the customer churn rate. RSI Concepts is a leading people counting system development company in Dubai, UAE. If you want to know more about the subject or if you want us to help you with deploying a very cost-effective tailor-made people counting system and heatmap analysis tool at your business, please feel free to contact us through our Contact Us page or leave a comment in the comment box below and we will get in touch with you soon.
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