Growth in the retail industry shows no signs of slowing down and reported a whopping $3.57 trillion in sales during 2017. The industry is on the cusp of a technological revolution with major players such as Amazon and Walmart integrating machine learning and artificial intelligence systems to facilitate better customer experiences.
Despite the influx of a large number of customers, retail businesses continue to face challenges when it comes to understanding consumer behavior. However, Big Data is ushering in a new era of real-time analytics that allows retailers deeper insights into consumer spending patterns as well as predicting their preferences and purchase locations with high degrees of accuracy.
Here, we take a look at how the big data is causing massive disruptions within the retail industry.
Customer Behavior Analytics
Deeper insight into customer behavior is crucial in solving challenges such as lowering acquisition costs, avoiding customer churns, personalizing campaigns, and increasing customer conversion rates. The problem is further exemplified by an increase in the amount of purchasing platforms such as social media, e-commerce sites, mobiles, and stores, all of which have created multiple interaction points between the consumer and retailer. This introduces an increased level of variety and complexity in data types that need to be analyzed.
Big Data helps to effectively analyze and aggregate such large amounts of data providing unprecedented levels of insight into consumer behaviors, motivation, and spending patterns allowing businesses to enhance customer acquisition and loyalty.
Increased Conversion Rates
Lowering costs and increasing customer acquisition requires a complete and accurate view of prospects and customers. Until recently, customer data was strictly limited to demographics collected via sales transactions. But now, interactions have increased through multiple channels such as social media and mobiles and provide a wealth of information to retailers.
Big Data is able to correlate social media behavior, purchasing history, and profile information and provide unexpected insights. An example is tracking a high-value customer and noticing that they prefer to watch soccer highlights on television and recently visited a number of stores where sports accessories were available. The retailer can use such information to send targeted ads to the customer regarding special promotions on soccer-related apparel.
Retailers can also monitor social media activity and purchasing behavior to accurately time their advertisements. They also have the option to test the degree of effectiveness of certain campaigns by noticing their effects on purchasing patterns. Additionally, customers browsing history can be accessed to better develop promotional strategies.
The benefits of Big Data are immense and have helped retailers gain immense success by uncovering hidden patterns and other extremely useful business information. BBI Consultancy is a big data analytics solution provider that helps businesses better understand their customers’ psyche and gain a strong competitive advantage. Contact them to know more.