Modern-day retail is driven by the empowered, tech-savvy customer who can access multiple buying channels in a jiffy, compare pricing and deals, and ensure that they get the best return on their expense. To understand and serve this new-gen customer efficiently, it is imperative for retailers to continually monitor and analyze all data points and patterns across business operations.
What is Retail Analytics?
Retail analytics empower retailers to get instant insights across different sales channels, inventory, pricing, marketing, competition, and more. They also get in-depth customer insights (buying patterns, purchase history, engagement, etc.) These insights enable retailers to optimize their operations, meet customer requirements do effective and efficient business. Let us look at some of the key areas in retail that are being transformed with retail analytics.
Understand Consumer Behavior
Getting to know the customer better, and being ready to serve them as per their need is the most significant advantage of retail analytics. By analyzing social footprints, past purchase patterns, purchase history, price buckets, etc. retailers get a complete picture of how their customers are moving. Retailers can correlate the insights gathered from different channels and strategize their campaigns to deliver a more personalized experience to their shoppers across channels.
Deliver Better Customer Service
With retail analytics, retailers get predictions on expected footfall at a store or traffic on online shop, especially during the holiday season. With these predictions, they can plan staff deployment at stores to ensure that all customers are attended to, and there is the minimum wait time at counters. Similarly, they can ramp up the website to brace the rush and deliver a seamless shopping experience. This has a two-way advantage, one when the staff is placed optimally, it reduces the stress on them, and they can serve the customers in the best possible way. For the customers, on the other hand, it becomes a delightful experience that would bring them back to the store or the website again.
Optimize Marketing Strategies
Retail analytics play a vital role in enabling retailers to optimize their marketing campaigns and get the best ROI across different promotions. Right from comparing which product image is getting more clicks to conversion ratio, to identifying most picked products from the shelf, real-time insights enable retailers to run and update campaigns as per response dynamically. At a store, a store manager can easily monitor the impact of in-store promotions on purchase patterns and get predictions on what promotion would be the most effective in the coming hour, day, or week.
Improve In-Store Experience
With enterprise analytics for retail, retailers can trace the way customers move inside the store. They can identify at which shelves customers spend more time, what items are more likely to be picked together etc. They can also do a demographic analysis of customers to identify and categorize customers according to gender and age groups. With these insights, retailers can plan store layouts that make it easy for customers to spot the items that they need. They can also strategize product and staff placements to draw maximum attention and serve customers better.
Retailers can automate the entire pricing process with retail analytics. With current insights and predictions, they can adjust pricing dynamically whenever there is any change in the buying pattern. With analytics-driven price optimization, retailers can understand customer preferences for pricing and how it impacts their buying decisions. Real-time analysis of pricing reduces the chance of error and ensures consistent pricing across all channels.
Manage Demand Proactively
Demand forecasting enables retailers to know exactly what product or service is most likely to sell in a given time. With the demand forecast in hand, retailers can plan for their product stocks more efficiently and ensure that there is no wastage.
Predictions on demand also help the retailers to get a better understanding of which market would place orders for which specific type of product, which product should move to what location, how many units should be stocked, etc. They can also do what-if analysis to gauge how the current demand would be impacted if there are any changes in the market. Equipped with these insights, retailers can proactively plan their product stocks so that they can meet the demand and ensure zero wastage at the same time.
Streamline Inventory and Supply Chain
Retail analytics helps the retailers to strike a perfect balance between demand-supply and operational profitability. It takes the guesswork out of maintaining optimum supplies and gives them real-time visibility into existing product inventory. They can also monitor their supply chain in real-time and compare distributer or supplier performance on availability, pricing, pending orders, outstanding amount, etc. With analytics, they can identify the best suppliers for different product categories across locations. They can also monitor shipments and order status in real-time.
Technology has revolutionized the retail industry and has opened new avenues for growth. As retail treads new pathways of innovation, analytics is its trusted partner to do effective and efficient business.