The location of your store or restaurant is crucial for success and could determine whether it succeeds or fails. The right location can have a significant impact on accessibility, visibility, and profitability based on multiple factors such as ease of travel to the location, demographics of customers at the location, location of competitors nearby, proximity to your other locations, and more.
Data insights can play a crucial role in the process of site selection for a retail or restaurant business. By leveraging data and analytical tools, businesses can make more informed decisions about the location of their stores and restaurants, which can help to increase their chances of success. In this article, we will learn how to use insights from consumer behavior data, to make informed decisions when it comes to choosing your next site.
What is Site Selection?
Site selection is the process of choosing the location for a new business or development project. This process is an important part of running a successful business, as the location of a store, restaurant or other development projects can help to increase foot traffic, visibility, and accessibility, all of which can drive revenue.
One of the key challenges of the site selection process is the vast amount of information that must be considered when choosing a location. Businesses must consider factors such as accessibility, demographics of an area, competition, potential cannibalization, and cost when choosing a site. This can be a complex and time-consuming process, which is why many businesses turn to data-driven site selection processes.
Approaches to Site Selection?
With advancements in technology and data analytics tools, businesses are no longer limited to traditional methods of site selection such as drawing 1-3-5 radius rings or manual traffic counting. These outdated methods are time-intensive and also inaccurate or limited in the kind of insights you can get. Today there are various tools available to conduct thorough site selection analysis using human movement and consumer data, allowing businesses to answer key questions, tailored to their needs.
The site selection process can differ based on the objective or the use case, For example, a high-end restaurant might be focused on providing a superior dine-in experience and attracting customers from up-scale neighborhoods whereas a QSR like McDonald’s might focus on areas with high foot traffic and easy accessibility for takeout and online delivery. The process can also differ based on the type of locations to be analyzed. The best approach for businesses is to identify the key questions they want answered through site selection analysis and look for a data intelligence tool that can help answer the questions and select potential locations.
Using Data to Improve Site Selection
Data-driven site selection involves using data and analytical tools to make more informed decisions about the location of a business or development project. This process typically involves collecting and analyzing data on factors such as consumer behavior, demographics, and competition. By leveraging data insights, businesses can make more informed decisions about the next location for their business, which can increase their chances of success. The benefits of these insights extend beyond just choosing the next location, but can also be used for better marketing and operational decisions.
For example, the following are some key questions that Near Pinnacle can help businesses understand with the power of location intelligence:
What is the trade area and what paths do consumers take to get to this location?
What times of day or days of the week does the area around the site attract the most foot traffic?
Is this location in the part of the shopping center that gets the most foot traffic?
What are the demographics and brand affinities of visitors to this location?
Are there choke points that can deter visitors from traveling to this location?
Would this location cannibalize other stores in the area?
Where do visitors to a location live and work?
By answering key questions like those mentioned above, retail and restaurant brands can choose a new site, analyze an existing site or even compare and contrast multiple existing sites to understand trade area overlaps, cannibalization, and more. Businesses can also take a macro approach and add popularity or geo-social affinity layers to location analysis to understand their customers’ brand preferences or the most popular spots in an area during a specific hour of day or week.
Are you looking to analyze your existing site or choose a potential site? Check out Near’s How-to Guide to Site Selection Using Consumer Behavior Data. Or, sign up for a free demo!