Automating traditional data management is the most sought-after technology in today’s retail industry. The demand for data automation is due to the cause of personalized customer expectations and seamless business operation between online channels and bricks & mortar stores. Retail industries experience quite a huge number of competition when compared to other sectors, yes it has to adapt to digital technology where customer-focused personalization is the key here.
Customer recommendation-based purchase is a significant upgrade imposed across the retail industry in order to improve customer experience and personalize the shopping experience.
The Power of Big Data Analytics in the Real-world Retail Market
Retail Data Analytics is one of the futuristic technology approaches that helps retailers to optimize supply chain management, customer loyalty, pricing, and overall recommendations. The data derived from the users are managed in a large volume which is later used to derive patterns, trends, and strategies to target the audience.
The emergence of Big Data Analytics in the retail chain can improve the overall operating margin by around 60%, according to Mckinsey.
The adoption of Big Data by several retailers has strengthened the competitiveness in the market and also triggered the businesses to innovate better ways to reach customers. The data-driven strategy understands the customers’ needs and provides recommendations ensuring utmost customer satisfaction.
Top Use Cases Retail Industry Can explore with Adoption of Big Data Analytics
Personalization of Customer Experience
The success of any industry or business is solely dependent on how far you maintain your customers’ satisfaction with your product or services. The implementation of Big Data Analytics Solutions helps retail businesses to predict customers’ demands and empower them to make customer-centric decisions to personalize marketing based on consumer data derived from applications.
Predicting the Customers’ Demands
Understanding customers’ demand is the key business strategy for the industry to propel in terms of revenue and growth. So in order to survive in this evolving technology, retailers have to move a step ahead in the market to understand the need of their customers using their data.
“Delivering an ideal and good shopping experience improves customer satisfaction, customer loyalty, revenue, repeat customers, and overall customer engagement,” says a Big Data Analytics expert from Accenture.
Empowers the Operational Effectiveness of the Retailers
With Big data analytics at the high point, the retail industry can coordinate the inventory department and the production unit for the highest profit and efficiency. Big data helps the entire department to utilize data, resources, and assets in the most appropriate way to improve service, budgets, and quality of the service.
By optimizing the data collected from the energy grid infrastructure, plant machinery, equipment, and servers, retailers can authorize data-driven decisions in order to increase the efficiency of these assets.
Strategize Customer Journey through Analytics
Big data acts as a Cardiac machine in the retail business that helps monitor the behaviour and activities of customers in order to improve the customer experience (buying experience). The customer buying journey has several stages where starting with research, planning, analysis, demo, purchase, service, and checkout. Creating a top-notch buying journey is possible with help of big data analytics.
Diverse Set of Applications for Retail Industry Using Big Data Analytics
- Segmentation of customers and audience based on demographics, trends, discounts, promotions, purchasing power, and more.
- It helps to understand the cash inflow and outflow of your retail business. Derives values related to Customer Lifetime Value that helps to calculate the Risk-adjusted Revenue & Risk-adjusted Loss.
- With Big Data, you can study consumer responses to each campaign or promotional activity once it’s launched.
- It empowers cross-selling opportunities where retailers can sell products that are not available in the portfolio or existing offers.
- With Big Data analysis, Demand forecasting is made possible where retailers can access the precise figure that indicates environmental figures, market conditions, and sales figures to determine the demand for production services.
- Big Data analytics helps to analyze the “Out of stock” situations where data analysis plays a critical role to calculate the lost revenue that has caused products’ stock out.
Earlier in 2018, the growth of Big Data Analytics in the retail industry was valued at around USD 3496.4M and is expected to reach four times CAGR growth around USD $13,299M.
Top Business values Retailers can Yield with the Adoption of Big Data Analytics Into your Operations
- It helps to enhance customers’ bill value and customer satisfaction.
- Ensures to create personalized discounts, offers, and values for customers based on their reputation and behaviours.
- It helps to define data-driven decision-making for staff management, and store layout and boosts demand for any specific products.
- Designed to focus precisely on high-value customers and increase customer footfall through offers, and deals.
- It ensures to delivery of smart pricing strategies in order to generate the utmost revenue and maximize customer retention.
A Big Example of How a Retail Industry (Bigbasket) has Transformed its Customers Base From 0 to 4 Million Using Big Data Analytics
One of the largest retail companies Basket started to utilize the power of Big Data Analytics in their retail operation five years ago and they established a feature called “Smart Basket”. The responsibility of the feature is to analyze the customer needs precisely and minimize the order rate below 3-4 mins. Earlier the overall order time was between 20-25 mins.
The objective of the feature is to scale the customer base and retention rate through data mining that indicates their behaviour, order value rate, etc. The “Smart Basket” feature analyzes customers’ buying patterns, shopping behaviour, previous purchases, preferences, and overall responses to the deals and discounts.
Big Data Analytics Solutions in Retail helps to improve the average customer bill value and retention rate with recommendations irrespective of products or items.
The Impact for Retail in High with Big Data Analytics, If Utilized Precisely!
The dominance of Big Data Analytics is everywhere. Almost everything that comprises online data can be analyzed. If the technology is not exploited properly, the retailer would stand to fall behind in comparison with the competition. On the other side, Big data analytics has endless potential and can deliver unlimited business value to your retail business.
Thank you to our guest author Madhu Kesavan! He is the founder & CEO of W2S Solutions, a globally recognized digital transformation company empowering enterprises and governments in their digital journey. With 20+ years in the IT market, he makes his vision for a sustainable future come true by leveraging technology.
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