No one has to tell retailers about their 21st century economic challenges. With the omni-channel consumer now in control, retailers need every advantage they can get.
Fortunately, most have been wise to see data as a key tool to win customer loyalty and boost margins. Here at Agnostic, we see our clients continue to investment in their data operations, both in technology and personnel.
And that’s a good thing. By using data to inform their decisions, retailers are increasing revenue, cutting costs, and maybe best of all, understanding customer behavior like never before. These insights are improving procurement, the supply chain, marketing, and all other key aspects of the operation that affect the bottom line.
We’re seeing more clients using location analytics. They can send geo-targeted mobile notifications, which research shows is nearly 8 times more effective than other types of notifications. Location analytics are also powerful at the store level to better assess shopping behavior and trends.
Predictive analytics, which arm retailers with the right data about future customer behavior, have also become popular. The problem, however, is that these data sets don’t describe the rationale for those possibilities. That’s why retailers should adopt explanatory modeling, which can point out the factors that affect customer behavior, such as weather and trends in popular culture.
Last, cross-platform analytics have become an impressive tool for assessing the end-to-end shopping experience. In simpler terms, this means tracking how customers act across social media, the company web site, mobile apps, as well as the old fashioned physical store.
Data is being gathered by in-store technologies like sensors and Wi-Fi signals, which allow retailers to track the customer decision-making path. For example, now we can understand where a specific customer will go within the store, even when they decide to view a specific product. All of this helps to improve merchandising and store layout.
Interestingly, the better the data collection technology, the better the customer experience. Augmented Reality and the Internet of Things (IoT) are giving shoppers a better way to conceptualize and “try” specific products and services, improving the accuracy of their purchases.
This means more satisfied customers while giving retailers valuable information for marketing and product development. If consumers and retailers are happier, that’s about as good as it gets.