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Retail Renaissance

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Copyright ©2022 Tango. All rights reserved. Retail Renaissance: How Predictive Analytics is Transforming Site Selection 6 See the relationship between brick-and-mortar and ecommerce With a healthy ecommerce business, you can tap into trade areas and reach demographics that are nowhere near your brick-and-mortar stores. You can even see when large concentrations of ecommerce customers come f rom the same communities—and how far they are f rom the nearest competitor. This is a key insight modern retailers use when evaluating locations. How will adding this site affect current ecommerce sales? If we remove this store, what percentage of sales can we recover through ecommerce? Cannibalizing ecommerce sales isn't the same as cannibalizing one of your other locations, but if you truly want to see the potential of a site, you have to consider its total impact on your business. That said, with an omnichannel retail mindset, you can see these as complementary aspects of your business, rather than two pieces in competition. Your store locations aren't just shopping centers—they're order fulfillment centers and warehouses as well. So having one in a location you're already doing business in regularly enables you to provide current customers with services and experiences they can't currently get. The relationship between ecommerce and brick-and-mortar isn't cut-and-dry. And there's another wrinkle: what if your ecommerce business currently has little-to-no adoption? Perhaps it's new or had a rocky start. If your customers aren't used to shopping with you online, they may be more reluctant to do so if you relocate—especially if there's a viable competitor nearby. Thankfully, this is another area where predictive analytics can remove the guesswork, helping you build complex models you can confidently base your decisions on.

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