Our third Retail Tech Trend of 2014 is the continuing endeavor to know everything about everything with analytics and big data. Retail has led the way in leveraging shopper and shopping data for greater customer-centricity, and the combination of staggering growth in available data and maturing of the analytics infrastructure will conspire for even sharper insights.
59% of retailers identified a lack of consumer insights as their top data-related pain point (Aberdeen Group)
2014 retail leaders will take the trend further with a focus on unstructured data and tighter real-time analytics. The volume of information from POS, online transactions, social media, loyalty programs, call center and customer support systems, and even wearable tech and the internet of things will continue to pour in. Innovations like IBM’s InfoSphere BigInsights and Apache Cassandra and Hadoop are making real-time analysis scalable and affordable.
But the customer-centric imperatives for retailers remain the same:
- Know Your Consumers. Top retailers know their customers’ demographics, purchase history, preferences, and their satisfaction with their consumers’ brand experiences. The amount of customer information goes beyond their direct shopping experience and takes into account multiple sources of information including the overall brand perception on social graphs and other offline insights. Focused analysis builds on layered segmentation to identify high value customers and design the personalized experiences that drive retention and loyalty.
- Optimize Your Offers. Consumer demands will drive the optimization of channel merchandising, product mix and assortments, and pricing. Channel operations can be aligned and re-aligned for inventory, utilization, and even location planning for stores and fulfillment centers. Resources are allocated for shifting and focused demands, especially event and peak readiness. Incentives and promotion planning are demand-driven and fact-based to capitalize on deep customer knowledge.
- Serve All Channels. Omni-channel experiences demand a 360° view of the consumer from all channels and all sources, regardless of how fragmented those channels may actually be. A consumer-centric view also aggregates financial, order, sales, and promotion knowledge to shape delivery the way the consumer chooses.
- Operate at Peak Efficiency. Consumer-centricity is obligatory, but impractical without an efficient operation behind it. Retail insights include traditional financial planning and analysis against industry data models, trade promotion, fraud detection, and loss prevention. Sales and consumer history uncover channel and product profitability and marketing and promotion effectiveness to further drive consumer-centric planning and forecasting.
One of the forces behind the mounting volume of available data is Cloud adoption, which we will address in our next post.
