Detailed understanding of the shopping tourists
Travel retail use case
“The client uses our data to historical analysis of their past performance, but also to get an expectation of what their performance is going to be in the next 3 or 4 months. As well as plan their marketing strategy, staffing, promotions, etc based on the nationalities that they know will be visiting in the next months. Air traveller data, therefore, is a very good proxy of future sales performance and can help you exceed expectations based on very important context information.”Edward HeaneyBusiness Director PSI
This case study will explain how a luxury retailer used ForwardKeys data to get a better understanding of the shopping tourism market. This luxury retailer operates on an international scale and works with a multitude of big luxury brands. They are specialized in transforming shopping into a fun and memorable experience. This is achieved by creating a place where there is something to enjoy for everyone. For example, they offer a wide range of restaurants as well as a variety of activities that can be enjoyed by families, but also by other target groups. Finally, they offer a wide range of luxury brands, often at a discounted price, to ensure no one ever leaves unsatisfied.
Importance of the shopping tourist
The shopping tourism market is one of the fastest, if not the fastest, growing markets within the tourism industry. Before, this market would only account for a small portion of the retailer’s visitors. However, over time the shopping tourists have grown into a very valuable and rewarding target group.
With this market growing at such a rate it became increasingly important for the retailer to get a better understanding of it. The retailer had three big challenges in deciphering the shopping tourists. Firstly, there are many different types of shopping tourists, for example: families, social groups, Asian business travellers, etc. All these groups have their own needs and preferred brands, which makes it hard for our client to know how, and more importantly where, to target these customers.
Secondly, the retailer struggled given that it was hard to predict when these shopping tourists would visit. And finally, they also had problems establishing, if and how special holidays such as the Chinese New Year and Ramadan influenced their sales.
Establishing the retailers needs
Our client approached us because they faced several issues regarding the shopping tourism market, and they were looking into ways of solving them.
It became clear that they needed to get a better understanding of who their shopping tourists were and, more importantly, where they came from. They also needed data that showed when these tourists were going to visit, so they would be able to prepare for them. Furthermore, this analysis also needed to be able to predict the impact of special holidays as mentioned earlier.
Understanding the shopping tourists with reports
When they considered buying ForwardKeys data, the first thing they needed was a correlation analysis. This showed if there was a relation between our data and the shopping behaviour (The process is explained in more detail in our “correlation analysis case study”). After the analysis showed the value of ForwardKeys data, our next objective was to clearly understand what they needed.
We were able to help the retailer in getting a better understanding of shopping tourists by providing regular reports. The destination reports showed how many tourists travel to the location of the store, where these travellers are from, and how the trends have changed over the past few years. Another report called the Forward 90-180-270 report provided them with travel forecasts up to 9 months ahead, so they know when they can expect their international shopping audiences. Lastly, they consulted our data analysts on a monthly basis to obtain the best insights. during these monthly meetings our analysts would break down the data and give a detailed explanation as to why certain data shifts occurred.
The results & continued work
the results of using ForwardKeys data
With the information provided by the reports, this retailer was able to do several things. First of all, because they knew where their visitors came from they were able to make strategic marketing decisions. For example, knowing where their customers lived, they were able to start marketing campaigns in their home countries, but also, at airports used to travel to their destination. This strategic marketing campaign had a very positive impact on the number of tourists visiting their properties.
Secondly, because they were able to monitor and predict traveller flows, they were able to anticipate demand. This meant they had the right amount of stock and the right staff, speaking the right languages, at the right time. Furthermore, it also helped in deciding when to do in-store promotions, and what in-store promotions to do. Finally, all these reports provided a lot of valuable KPIs which are used regularly in reporting.