Big Data: the Treasure Hidden in Your Multi-channel Retail Software
Your multi-channel software is collecting a goldmine of data - if you only know how to use it.
There’s nothing new about the value of data, about appreciating the importance of collecting and exploiting customer information.
According to former Tesco Chief Executive Sir Terry Leahy, the data gained from its Clubcard (launched in 1995) “transformed the company”, leading it into convenience stores and online, and resulting in Tesco overtaking competitors Marks & Spencer and Sainsbury’s.
Leahy refers to the ‘economics of data’ - or using data to:
Improve supply chain and operating systems management.
Understand customers better.
Create more relevant benefits for customers.
Build loyalty and customer retention.
Inspire more spending (and more profitable spending).
“Data-driven retail ultimately has the potential to transform the high street.”
Sir Terry Leahy, former Tesco Chief Executive
And by extension, multi-channel retail too . . .
Data. Lots of it. BIG data – the treasure hidden in your multi-channel retail software.
But are you banking it?
Of course, the challenge is interpreting or analysing your big data analytics in a meaningful way.
“Just 22% of companies have a framework for analysing multi-channel customer journeys.”
Econsultancy: Online Measurement and Strategy Report
“We have almost too much data at our disposal, and it can sometimes be hard to sift through all of that information and understand what it really means.”
Megan Moldovan, Director of Platform Logistics, Annalect
No data-driven insights – no awareness – no influence – no sales – no loyalty and retention . . . Bye bye business.
Retail marketers struggle to piece together multi-channel data.
Reading the runes . . . in real time
Switched-on players are ensuring they can do something useful with their data.To blend it, bend it and transform it into a key differentiator, a key competitive advantage.
They realise that, due to a combination of cheap and powerful storage and the vast array of fresh data sources available through social media and behavioural analysis, retail stands on the edge of a behavioural goldmine.
Return on social
Social media revenue over cost was up nearly 60% in Q3 2013.
“Revenue is up, traffic is up, ad spending is up and click-through rates are up, with posts from Facebook, Twitter, Pinterest and Tumblr seeing the greatest results.”
Joe Martin, Adobe Digital Index Analyst
It seems that social is at last starting to deliver. And it’s all down to data, collected in the form of likes, retweets and pins etc.
Because online behaviour is so measurable, retailers can create content that users find super useful. They can tailor offers that users will find attractive. Intelligent, real-time, targeted, location-specific offers.
Social . . .
CRM . . .
Marketing Automation . . .
Business Intelligence solutions . . .
Whatever the sources of your data – how effectively are you collecting it?
– how effectively are you interpreting it?
– Most importantly, how effectively are you using it to drive your pricing, merchandising and overall business strategy?
To do list:
Make sure your software can collect and analyse customer information from every relevant source: POS systems, online transactions, social media, loyalty programmes, call centre records . . . etc, in real-time. If not investigate whether you should be investing in new software with the latest analytics, which can capture customer information and give instant actionable insights in real-time.
Use this information to deepen your understanding of customer preferences, more accurately identify shopping patterns and generate more precise customer segmentation. These new insights can help you to deliver highly targeted, location-based promotions, in real-time.
Use your information to build smarter supply chains and optimize merchandising across a multi-channel retail operation by: 1) predicting optimal pricing and maintaining a price leadership position by analysing price and demand elasticity; 2) selecting the right merchandise for each channel and fine-tuning local assortment planning by drawing on insights from social media, market reports, internal sales data and customer buying patterns; and 3) optimising inventory across multiple channels by using leading indicators such as customer sentiment and promotional buzz to anticipate future demand.
“Now is the time to invest in data – which, unlike other retail business costs, is falling in price.”
Sir Terry Leahy, former Tesco Chief Executive