How do retail giants use analytics to devour competitor’s market share?
Data can be a ticking time bomb unless used to our advantage at the right time. It has the potential to make or break the progress of an organisation. The insights gained from utilising data for leveraging our position is what differentiates a leader from a competitor. Such is the importance of data that it helps to winnow the grain from the chaff. Data has been successfully used in businesses to help organisations overcome the most dire situations. Data analysis in retail implies an insight into the footfalls, purchases, sales, inventory etc to effectively chalk out a progressive future.
Data can be found in the most unexpected places. A quick look at the POS (point of sales) data will give information on profit margins, basket sizes, customer counts, sales trends and more. Data sourced from POS often enables a company to understand their market segments and help them arrive at niche strategies that can drive sales. When data is taken from point of sales, it is important to analyse them as a combination of metrics which can give more insight into future planning than a single metric. Reporting can reveal which product drives revenue. It allows a retailer to save time and money. It is important to understand customers perception in our decision processes, as customers who become a important party to all future decisions the organisation takes. It helps the retailer serve the customer better and adapt to their tastes and preferences. The customers are assured of a delightful experience as a result of this.
Retail Analytics metrices that help the retailer take important decisions can be summarised into
- 1. Sales per square foot – It gauges the performance of the store space while conveying its profitability
- 2. Retail conversion rate – These analyses the conversion rate of browsers into buyers which help understand if the products are more than just a visual treat.
- 3. Net profit margin – It is a percentage of the revenue the company makes assesses the overall profitability.
All these tools help retailers gather a clearer picture of their business. They get a chance to streamline staff and operations with the availability of data and it helps them discern the spending habits of customers which help build long term relationships.
Email marketing software allows the retailer to gain insights into click and time of engagement. It helps the retailer understand what subject matter clicks with customers and paying attention to the time when messages are read allows the retailer to time his campaigns more effectively.
Foot fall data allows a retailer to understand customer count and the time he dwells in a certain space in the store. It lets the retailers to understand which part of the store gets the least customer attention and ideally stock goods where customers linger and spend the most time. These past data can be used to maintain inventory or even plan the store layout. Timing is the key in a competitive business-like retail. Using real time data available online and collating offline data allows a business to gain an edge over its competitors.
Sometimes it is important to give human insights its due rather than rely on technology. Intuition is a very powerful tool. Pay close attention. Listening is an oft forgotten dying art and is very much required in building a relationship. At the end of the day a retailer – customer relationship is also one which needs to be nurtured.
Nu-Pie has first-hand involvement in the designing and providing solutions that provide insights based on human behaviour that catches the essences of sentiments and intentions that are not binary in nature but are influencing factors of business, particularly in the retail Industry. Malcom Gladwell in his book Blink talk about snap judgment and how the subconscious minds processes data to provides us with insights that our conscious mind could never process. Machines have started modelling the hidden potential of the human sub conscious mind and, as a result, analytics technology is on the verge of fulling understanding the largest species on our planet.
Author: Jerrin Thomas; C0-Author: Benila Jacob