Today, digital emergence is creeping into retail sector in an amazing way. Being in touch with customer continuously is essential and no retailer can afford to estrange its customer. Retail analytics, cloud, social and mobile solutions are must in today’s world to succeed. Unlike age-old days, It is cheaper, faster and easier today to store and process more data than ever before. Retailers have grown better at data management. Question is, how well are they able to leverage insights from this analysis to drive strategic decisions?
The Indian shopping experience has undergone a sea change from open markets to mom and-pop stores to multi-storied shopping malls that are mushrooming all over the country. While this has been happening, the Indian consumers have transformed into a shopping savvy bunch with multiple options in the market. Every retailer needs to become adept at seeing customer trends and preferences with the help of data analytics. Online retailers like Amazon, Flipkart are some of the biggest players using retail analytics in India.
In a recent study by MasterCard it is found that eight out of 10 consumers now use a computer, smartphone, tablet, or in-store technology while shopping. Forrester also predicts that cross-channel retail sales with reach $1.8 trillion in the US by 2017. This indicates how retailers have leveraged technology along with the present industry needs.
Challenges faced by retailers
Customers today approach the buying process more knowledgeably than ever- with more options available at their fingertips.
- Customer engagement and retention – This isn’t a new problem for a retail business, but the solution to this problem continue to change.
- Messaging apps have surpassed social networks – Retailers started looking at the integration of messaging apps with their marketing strategies to analyze the insights from the messaging apps like Whats App, Viber and Facebook messenger compared to social conversations.
- Mobile experience and engagement – Retailers face challenges in utilizing the mobile to provide user experience. Reaching huge set of customer base is becoming challenging as there are many options available in the market.
Why retail analytics is important?
Real-time analytics will provide an overview of today’s customer preferences. It further enables the retailers to analyze region wise purchasing patterns that is helpful in creating a product that consumer is interested in. It provides insights from visibility and control, to transparency, to efficiency, to customer engagement. Retailers will also gain insights towards the stock-in-hand to make the stock projections well in advance and have an overview in their respective stores.
Along with consumer interaction with retailers across various channels they can also really know the customer. Knowing the customer better than competition and having the ability to orchestrate business decisions at the speed of insight is the new retail competitive battlefield, and business analytics, not Business Intelligence, can be one of the strongest weapons in a retailer’s arsenal.
At different levels of maturity and to varying degrees of success, leading retailers such as Amazon, Wall-Mart are among others who are leveraging analytics to:
- Gain a deeper understanding of their customers’ behaviors, needs and preferences to build a more personal relationship.
- Improve marketing effectiveness through micro-targeting, professionalization and offers increase in the likelihood of purchase.
- Optimize the supply chain to ensure the most profitable outcome in terms of demand fulfillment balanced against cost of carrying excess inventory.
- Determine pricing, including bundle and basket pricing, based on the value customers attach to their needs at any given time.
- Spot flash trends that have an impact on demand to be able to turn them into revenue capturing opportunities.
Now it’s your turn: What is one other challenge you face in retail? Do you think business intelligence can help you overcome it?