Analytics isn’t just a buzzword in retail
"Big data analytics" and "actionable insights" are two phrases one is likely to encounter when reading an article packed with laudatory comments regarding information analysis.
Their prevalence has caused many business professionals to write the technology off as just another piece of software supported by ambiguous buzzwords. Such articles discredit the value in using retail analytics, when in fact such technology supports the following trends:
- Personalization: When an algorithm notices a person has purchased a pull-up bar, a yoga mat, and a set of 15-pound dumbbells, it not only deduces that the customer is interested in fitness, but that he or she engages in endurance and flexibility training. As a result, the solution will recommend a medicine ball and an abdominal wheel.
- Location-based inventory: While it's assumed people living in northern Idaho are more likely to purchase four-wheelers than people in New York state due to the latter region's dense population, analytics may show something different. While people residing in NYC, Albany, Syracuse, Rochester and other metropolises will probably refrain from purchasing quads, those in the Adirondacks may elect to buy such vehicles. While humans assume, software ascertains.
- Customer service: Sensors connected to complex analytics programs can distinguish browsing behavior from knowledgeable shoppers based on the way customers move within a store. While someone moving slowly down an aisle may be "just looking," a person walking fast likely knows what he or she wants.
For broad-stroke analytics endeavors, the kind that involve a merchandising outfit transforming its operations to achieve strategic growth, careful planning and organization is needed. IEDP noted the conclusions of Galit Shmuéli, a professor at the Indian School of Business who maintained executives shouldn't expect to encounter flawless processes.
"The Internet is filled with a lot of emotional people, and there are many who use social media platforms to express those feelings," said Shmuéli, as quoted by the source. "Managerial support must extend to allowing failures, as long as they result in lessons learnt."
Of incredible value
Merchants are recognizing the success of retail customer intelligence deployments and other such solutions. According to a report conducted by MarketsandMarkets, the retail analytics market is anticipated to increase from $1.88 billion in 2014 to $4.4 billion by 2019.
One of the main reasons why such technology is being valued so highly is because cybercrime and other forms of theft have become more prevalent in the industry. It is believed data analysis will reveal ways in which such deviant behavior can be deterred.