The Retail Industry Is Observing A Rapid Development or Shift From The Last Decade. The eCommerce gateways or portals are substituting brick and mortar shops (the stores’ physical presence) as the chosen and favored place for shopping for patrons. Notwithstanding, this does not indicate that brick and mortar retail stores are on the edge of extinction. According to recent research, it was evaluated that 70% of buyers research online before buying or purchasing in-store. It demonstrates that there are some customers or shoppers who still prefer to select and buy physically from brick and mortar stores. Still, there are a revolution and transformations in the manner the retail industry functions – both offline and online.
Until a few years back, the retail industry concentrated only on marketing and customer/buyer service. But now, the core focus is on collecting and gathering data, interpreting it, and then practicing or executing the conclusions achieved from the analysis to improve and boost the marketing and customer service approaches.
There are numerous advantages of data-driven decisions in the retail industry. Let’s discuss and observe them in detail:
Renders Targeted Communication to Buyers/Consumers
We live in an era where the personalization of services distinguishes businesses or organizations from the competition. It is seen that personalized selling or marketing is 20% more effective and powerful than traditional marketing. It is possible probably because of the analysis of data. Retail companies or organizations track their data at all stages of the purchasing process. They also apprehend the past shopping experiences or purchases of the buyer. This data serves them to target the patron with personalized communication and pieces of information. Therefore, the next time if you see an ad for the shoes you had checked or browsed online a few days ago on an unrelated website, you discern the reason behind seeing the same.
Anticipates the Demand and Controlling Inventory
Adopting data analytics in retail companies helps understand the consumers’ buying requirements and concentrate mainly on the areas with high needs. The outcomes are acquired and achieved from the data that supports the organizations or retail companies to determine and predict the demand and accordingly maintain the inventory.
Optimizes and Upgrades the Price
The predictive data analysis benefited greatly in ascertaining and evaluating the rise and fall of demand. Through the proper data analysis, it was found that when the price of a product is progressively decreased from the time the market falls, the demand boosts again. It is contrary to the popular technique of reducing the cost after the shopping season ends and the demand is decreasing.
Improves Customer Experience
Data analytics help retailers interpret how buyers shop and use the data to provide a seamless and smooth customer experience. Data analytics concentrates on implementing personalized attention and care to the individual customers from picking a product to purchasing it. This experience helps in the long run in winning customer loyalty.
Prognosticates Trends in the market
If we observe the marketing initiatives of the top-most online shopping websites, such as Amazon, that offer different discounts and deals before every significant festive season, you will observe how data analytics proves the worthiness of holding it. The marketers use the sentiment analysis approach that serves them to analyze and examine the market’s sentiments as the marketers understand that festive seasons are when most people do purchases and shopping.
Determines opportunities with tremendous Return On Investment (ROI)
Data analytics help the retail industry find and evaluate options or possibilities with a substantial and high ROI. For instance, retailers adopt predictive analysis to measure and regulate people’s responses to marketing operations and to know more about their willingness to order or purchase a product.
Retain and engages customers
A dissatisfied or disinterested patron/customer can proffer restless nights to every retailer. Bringing back a disengaged shopper, mainly when there are numerous options at their end, is a challenging task. Though, it is relatively not an impossible one. Data analysis supports distinguishing the shoppers who are not interested and engaging with your brand, the one who could be a constant and regular shopper, and the one who will be a frequent buyer. It promotes the retailer to introduce discounts, offers, and incentives to engage and captivate to retain the patrons/customers.
Determines or ascertain location for new outlets
This is remarkably favorable for retailers who want to open a new outlet in a particular area. Data analytics improves and assists the retailer in determining the places where most people spend a maximum of their time. Data Analytics also furnishes information or data on the demographics, spending potential, and market circumstances. These benefits retailers in choosing and deciding areas that they think are appropriate for managing and controlling their retail outlet and getting the highest patrons/customers.
Determines innovative techniques to engage with consumers
It is a well-appreciated fact that patrons/consumers always favor personalized services, which provides businesses or corporations an advantage over the competition. It is witnessed that retailers who analyze and examine the data based on the popular current trends in the market can resonate thoroughly with potential and existing patrons.
Assists Strategic Decisions
When we talk about the retail industry, it ultimately depends on the data or pieces of information to decide strategic decisions. Companies and businesses rely on data to compose notified and informed corporate strategic decisions practicing a single and trusted source of data/information concerning products and patrons.
Conclusion
The retail industry encounters challenges, including a lack of confidentiality, security, and data privacy. Furthermore, there is also an argument of a lack of a proficient and experienced big data consulting company to interpret or decipher information and the companies’ incompetence in implementing the insights obtained from analytics into the industry.
However, with the appropriate skills and accurate inference from retailers, data analytics can increase consumer loyalty and boost their brand picture by achieving consumer satisfaction. Being technology taking a center platform in the retail industry can reliably be concluded and understood that data analytics is and will remain a crucial and significant component in the retail industry.