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From guess-work to complex spatial analysis: mobile positioning data as a valuable asset for retailers

„Location location location.“ A quote often heard in many fields but for retail planners and managers, it is especially crucial. Store location is one of the most important decisions in the retail business. Because the success and profitability of a store hang on this decision, many variables, that lead to the perfect location setting need to be carefully evaluated and considered. Therefore, many location techniques were developed. Firstly, because scientists have been concerned by this topic for decades, many location techniques vary strongly in terms of what time period they were developed and which field they were developed in. Secondly, the variety of location techniques depend on available data sources and in the last decades there has been a huge shift in data availability and variety. In our study, we applied modern GIS techniques and modern data sources – mobile positioning data.

Instarea is. academic

Last summer Instarea was represented at the world’s biggest geographic conference, which was held in Quebec, Canada. In the buzzing atmosphere amongst 1500 delegates from more than 50 countries, we presented the possibilities of telco positioning data usage, not only for geographical research but with wide application potential for retail planners, managers and in all aspects of geomarketing. Our contribution was aimed at Trade area delineation through telco data. Trade area is a concept that can be used to evaluate retail sites at every stage:

  • evaluate possible locations prior to retail site selection
  • evaluate retail locations of your competitors
  • evaluate your retail locations and analyze them

Trade area can be described as a geographical area, where most of the customers are from and where it is still relevant to promote your offer. In general, the predecessor of nearly all current location techniques is based on location theories of W. Christaller, W. Reilly or D. Huff.
We adopted their basics and compared it with modern data sources – mobile positioning data. As a result, we discovered how the theoretical model differs from reality and where the actual trade areas for the biggest shopping malls in Bratislava are. Shown in the figure below.

With mobile positioning data, it is possible not only to observe actual trade areas but also to analyze its customers, know their spatial behavior and provide customer segmentation. So you can find answers to crucial questions asked by the retailers:

  • Who are your customers?
  • Where do they come from?
  • When do they visit your store?

Find your potential customer segment & attract them

Once your retail is located, you can let people know you are here and attract them with your offer. Instarea has developed a self-service campaign tool based on mobile positioning data, where you can target people by various attributes based on their demographics, behavior or specific location. Let them know any good news via SMS or special LBS channel that will send an SMS message to everybody who enters your desired area and matches your criteria. Register & try it for free or reach out to me if you have any questions: peter.barlik@instarea.com .

Peter Barlik

Data Scientist @ Instarea

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