Big data analytics in the retail market isn’t just a passing trend. This is the reality that businesses will have to accept if they want to swim rather than sink. It’s an excellent component in addition to your existing customer-centric strategy.
Imagine walking into a store in search of one product. But rather than going aisle to aisle, shelf to shelf, the item you’re looking for is right there waiting for you. It might sound far-fetched, but this analogy isn’t far off from how retail analytics is changing before our very eyes.
In this guide, we’ll discuss how the retail industry is being reshaped by data collection and retail analytics.
How Is Big Data Collected for Retail Analytics?
You might hear the term big data thrown around a lot in marketing speak, but what does it really mean?
To understand this concept, think of how our modern, internet-enabled world works. Everyone has computers, smartphones, smartwatches, and even smart home devices at their disposal. We spend long hours on these devices, interacting with everything from social media websites to online retailers.
This digital infrastructure makes it very easy for businesses to gather different types of data from their customers. These types of data may include:
- Customer demographics
- Device information
- Time spent on a product page
- Frequency of visiting a certain website
- Purchasing history
With the help of artificial intelligence, businesses can analyze this data more effectively than any human could. The information you glean from this data can help you better understand your customers. The better you understand your customers, the better your marketing strategy will be.
As you can imagine, this is very powerful information. The more types of data that you gather, the more accurate and effective your retail analytics will be. But how is this big data affecting the retail industry?
The days of roadside billboards and bus-stop posters are over. Thanks to targeted advertising, companies can advertise directly to the people that are interested in their products.
This is huge for the retail industry, since it’s very difficult to identify the customers of your target products. With targeted advertising, your ideal customers see ads for your product everywhere they go on the Internet.
Better Inventory Management
Having too much or too little inventory is a perennial issue for every retailer on the planet. Having too little inventory robs you of business, sending your customers to competitors. Having too much forces you to liquidate later on with big sales.
Retail analytics of big data allows you to understand the nature of your purchases. You can see how well a product is selling, what times of year it sells most, and more. It’s easier to adapt to market changes if you have an improved understanding of your sales process.
Customers will often stumble upon something they didn’t know they wanted. It’s for this reason that YouTube continues to be an incredibly successful video platform. The powerful algorithm gives excellent video recommendations, causing people to watch YouTube for many long hours–ads included.
There’s a good chance your customers want something else that you sell, but don’t realize it. Big data can help you to the connection between related products, and the customers who want them.
Every company has to make predictions about where they are headed. There’s no better way to understand your future than to understand your past. Big data analytics allow you to get a big-picture view of your business so you can better see where it is headed.
This is perfect for choosing pricing for an upcoming season of sales. You can get an accurate idea of how much you are likely to sell and the profit that will come as a result.
Personalizing Every Customer Experience
At the end of the day, customers are what this is all about. Your customers are the reason you do what you do. Big data is what helps you to comprehend their needs and desires better.
Unfortunately, many customers feel like they are just another drop in the ocean. Many businesses are using big data to personalize the customer experience to a degree never before seen.
By having this intimate understanding of your customer, you know what forms of outreach are most effective. If email newsletters aren’t working, then you can send coupons. If you notice a trend in their purchasing habits, you can entice them to buy more when they are most likely to do so.
Better Data for Shareholders and Investors
Those who provide venture capital for your business will want to see where their money is going. This means that they often require detailed financial reports for every quarter. Big data helps to paint an accurate picture for them.
You can provide in-depth presentations on almost any data point they could ever want. And most importantly, you can prove the effectiveness of your current strategies and growth in sales. It’s an essential tool for demonstrating the success of your business.
Verify with Inverite
Retail analytics, thanks to the power of machine learning and big data, are able to provide a detailed view of every metric your customers have.
At Inverite, we provide real-time instant bank and ID verification to take steps away from your underwriting process. Book a demo with us today and find out how we can help your business reach new heights.