Improving digital marketing from store visit measurement data that is difficult to capture with GPS (Odakyu Department Store Co., Ltd.)
Odakyu Department Store is a department store of the Odakyu Group with stores along the Odakyu Line, including Shinjuku. We are a company that introduced Cinarra’s solution from 2016 and is still using it as of June 2019. This time, Kubo and Hirota, who are in charge of sales, asked about their impressions of using Cinarra’s solution as an advertising manager for the Shinjuku store of Odakyu Department.
We hope that you will be able to refer to what new possibilities open up for digital marketing in physical stores through solutions that utilize location information.
Pre-installation problem: I want to use digital media to reach out to non-existing customers, but I can’t measure the results…
――First of all, could you tell us about the problems you are facing in your business?
There are two main types of advertising media that we have been using for a long time.
The first is newspaper inserts, hanging advertisements on trains, and posters and digital signage around stations, taking advantage of our location right above the stations to convey information to a wider target audience.
The second medium is direct mail based on the Odakyu Group’s credit card customer information, which directly encourages customers to visit the store.
The latter, direct mail, is effective as a measure for customers for whom we have customer information, but it can only be used to reach existing customers. However, it has the advantage of knowing whether the customer has actually visited the store and made a purchase through the card information.
The former medium, which conveys information to a broader target audience, can be said to be on a downward trend, as generally speaking, the effectiveness of inserts has decreased due to the decline in newspaper subscription rates, especially among people in their 40s and younger, and the effectiveness of hanging advertisements has decreased due to changes in the way people spend their time on trains, such as browsing smartphones. Another problem that we have been facing for many years is the inability to grasp whether the people who receive our information are visiting our stores or not.
In the future, we would like to strengthen our communication with women in their 30s and 40s who work in Shinjuku or visit Shinjuku frequently, but it is difficult to approach them using conventional methods. This was a constant topic of discussion within the company.
Why did you decide to implement Cinarra?
――Why did Mr. Haraguchi decide to implement Cinarra’s solution when he was facing such a challenge?
In our case, we are a department store, so we have many floors. Specifically, from the grocery store on the second basement floor to the restaurants on the 14th floor. Also, the first basement floor is a train station, and we don’t have any stores there. Even with a solution that uses location information, if we used GPS, we would not be able to determine which floor the customer came to, but since Cinarra uses Wi-Fi, we were able to visualize whether the customer who saw the advertisement came to the floor that we advertised. Also, since the department store is located above the station, we felt it was an advantage that people passing through the station were not included in the measurement results.
Changes after implementation
――Thank you very much, what results have you obtained as a result of the introduction? Please tell us in detail.
Results 1) We were able to grasp in numbers that Internet advertising was contributing to store visits.
In addition to visualizing how many people actually visited the store as a result of spending money on advertising, we were also concerned about whether or not the number of customers visiting the store was worth the amount of money invested.
For example, in the case of a men’s clothing sale held on the 11th floor of the main building, the approximate unit price of a suit purchased would be between 30,000 yen and 60,000 yen. Currently, we cannot measure whether the customers who visited the store actually made a purchase, so we can only make a guess, but when we consider the approximate amount of profit based on the purchase rate, we can estimate how much the CPA for visiting the store would be as a reasonable investment for advertising. This is due to the fact that Cinarra’s solution allows us to understand in numbers what actually led to a visit to the sales floor, which other media cannot.”
Outcome 2: We were able to have an index of CPA for store visits, which was helpful for future media planning.
Since there was no index for CPA per visit, it was difficult to know whether the CPA per visit was high or low. If this were an e-commerce business, it would be easy to calculate the CPA as a rough guide because conversions are captured on the web, but this is not so easy in a physical store. However, by using Cinara’s solution, we were able to have our own index for this.
Now that we have our own measure of CPA for store visits, we can refer to that figure in our media planning and PDCA cycle, which is a great achievement.
――Thank you very much. Finally, do you have a message for those who are considering Cinarra’s solutions?
I think it’s important to start small and give it a try. Even if you are aware of the issues, you can’t move forward unless someone starts within your company. I recommend that you try it first and create results that can be measured in numbers.
Also, in order to move forward, you will probably need the cooperation of people outside of your own department. In such cases, it is important to find people within the company who might be interested in the new initiative. The results of the small test will be useful in getting those people involved.
In every company, there are people who have a sense of crisis about the current situation. I am sure that they are also wondering if there is anything interesting that can be shared with them, so by taking a step forward and working with them, I believe that new discoveries can be made.
I feel that this is a very effective way to get data to discuss something.