We just witnessed yet another record retail holiday season. Online sales for Thanksgiving Day and Black Friday reached $5.27 billion, up a strong 17.7 percent from last year, according to Adobe. Black Friday set a record by ringing up $3.34 billion in sales, a year-over-year increase of 21.3 percent. As retailers geared for the biggest selling season, use of big data gained momentum due to its role in increasing sales.
Big data combines information from web browsing patterns, social media, industry forecasts, and existing customer records to forecast trends, locate customers and gear up for demand.
With such a massive growth in the number of mobile devices, brick-and-mortar stores must keep up with the ever-transforming retail landscape. In light of this, hoards of physical retailers are now turning toward advanced tools such as Wi-Fi analytics to gain insight into customer behavior and offer a more seamless and personalized shopping experience.
This transformation is mainly due to the advances in digital, social media, mobile, and location-based technology. Today’s consumers are shopping across numerous channels which has retailers scrambling to find ways to adopt a single, flawless approach to interact with their customers whenever and wherever they want across all channels.
The following examples illustrate the link between big data and the future of retailing.
Gathering better intelligence
With the right Wi-Fi analytic tools in place, brick-and-mortar stores can collect data regarding customer behavior, and help answer the following questions:
How much traffic is there outside your store? How many consumers enter your store? How many consumers stop by your store’s windows? Are these new consumers or repeat customers? How do these numbers compare to last week?
Apart from that, these solutions can also help collect and interpret in-store metrics related to the performance of the staff. With big data, the following questions can be answered: Which zones in your store attract the most number of shoppers? How effective are your methods of drawing shoppers into your store? How regularly do customers visit your store, and for how long? How efficient is your staff in serving customers? How effective is your checkout queue managed?
Shopper intelligence analytics helps retailers better understand their customers and offer a shopping experience that meets (or even exceeds) their needs.
Connecting with store visitors
Research published on the Harvard Business Review blog stated that personalization delivers five to eight times greater return on investment on marketing, and increases sales by 10 percent or more. This doesn’t come as a surprise for retailers who are already turning toward big data analytics tools to understand and serve their walk-in customers, giving them personalized offers on their cell phones based on the data gathered.
Big data is also being used to counter the effect of showrooming, a behavior where shoppers check out an item in your furniture store before heading online to find it cheaper. Many retailers have started offering full-fledged mobile sites as well as smartphone apps so customers can easily compare prices using QR codes.
In general, big data analytics is being used by offline retailers to gain a strong foothold, particularly in today’s highly competitive markets where online retailers have started to capture more market share. Big data will undoubtedly take retailing to a whole new level, and wise retailers should not hold back from tapping into it.
But that’s not all.
The incorporation of Business Intelligence (BI) has been gaining momentum in the retail sector as well, and companies across the globe are picking up on the significance of this tool. As stated by Mike Webster, senior VP and GM of Oracle Retail, “The rules are being rewritten. At the core, it’s all about how do retailers provide their customers with a seamless experience regardless of channel.”
Here are some key areas where home furnishing retailers could incorporate Business Intelligence into their operations:
Marketing is a significant business expenditure, yet the outcomes can barely be forecast with precision. Most of the time, the campaigns are but a blind shot with a high probability of missing out on the targeted objective. Using Business Intelligence can help generate an on-point analysis about the campaigns that yield the most profits and the ones that are doomed. Furthermore, BI tools can individually assess the campaigns and customize them to pursue direct hit results.
Omni-channel analytics is an effective method of gathering business intelligence data. It operates with a specific and predetermined array of key performance indicators that provide elaborate and in-depth insight about the information that accumulates regularly with each customer visit or online input. BI-based augmentation of a retail omni-channel eventually paves way for an integrated business environment in which the information can be accessed and evaluated in an instant and results can be inferred in less than a millisecond to cash out on potential sales or other business opportunities quickly.
In the e-commerce domain, BI tools can automate the online selling process, providing an instant, intelligent analysis and respond to customers through websites and other online platforms. This enables the businesses to reduce spending on manual customer support, keeping live interactions for complex issues, while BI tools efficiently handle the regular e-sales operations.
Inventory and overheads control
Inventory and overheads management is an expensive operation which can be replaced by using BI tools, which would automatically keep track of the incoming and outgoing inventories, and manage it according to supply and demand. This cuts down the additional cost of inventory management and also ensures a smooth supply-chain process.
Retail network management
Business Intelligence tools can be of a great value while establishing a networked link between the outlets as businesses expand their operations. This is equally effective at national and international levels. It keeps track of the performance and supply chain of the outlets and stores spread nationwide, while on global level, it automates essential operation as in the currency exchange rates during price estimations and compliance with international regulatory mechanisms.
Being a retailer, it’s essential that you keep track of where the market is heading with the alterations in consumer choice and behaviors. The analysis of data related to closed sales, about the high-in-demand products, the products that failed to catch the consumers interest and the trending patterns of the home furnishing would enable you to better gauge future analysis and devise your plan accordingly.
The bottom line is the home furnishings industry is booming with technology. Data is the key to getting into the mind of your consumer and drawing out desired outcomes. The technological interpretation of your business data cuts down on the slam dunk costs and elevates the magnitude of high-end efficiency. Moreover, with effective and smart data analysis through software and applications, you can make better decisions about which products meet your customers’ demands and influence their purchase decisions.
And the best part is, with the constant evolution of these technologies, these strategies and tactics have become affordable for any sized retail operation in the home furnishings industry.