In every industry, but most obviously in all aspects of retail sales, digital technology is becoming a fundamental part of the retail business model. Consumers more and more expect a personalized, customized shopping experience that combines value, convenience and choice. Early adopters of new technology have been eager to interact with retailers and in the process they have often become solid, loyal consumers, which are “the prize” that every retailer seeks. This loyalty comes at a price for vendors, though. Consumer expectations are higher than they ever have been and they are facing more choices in products and more ways in which to interact with retailers than ever before possible. With opportunity comes challenges, and businesses of all sizes and in all industries must be ready to compete.
One of the earlier developments that made an immediate impact on business models in all categories is analytics. Having access to consumer data and having the ability to analyze and manipulate said data in various scenarios has enabled online retailers, and even brick-and-mortar institutions to a lesser degree, to provide shoppers with customized offers based on their likes, dislikes, and purchasing history. As retailers get to know more and more about their customers the pressure is on to provide them with customized, super-relevant shopping experiences.
Every customer is an individual and they expect to be treated as such. People want their hard-earned dollars to go as far as possible, and they now expect more for their money in many ways. The bar has been raised. Consumers want what they want, when they want it. Period. The term Internet of Everything is becoming a catch-phrase, but it is the truth. Anyone can find anything online, and businesses must use every tool at their disposal to compete. Data and performance analytics become indispensable in the digital retail environment.
In this newly connected society while we make the transition from the physical shopping experience to the virtual shopping experience, it is imperative that retailers choose an analytics platform that enables them to provide their customers with hyper-relevant experiences that blend the best of online shopping with the advantages of the in-store experience. Using customer data from website visits is now commonplace and relatively simple. Most if not all CRM tools like these recommended by Software Advice, have analytics capabilities, and using the data trail and demographic information gathered from website visits allows merchants to provide customized product recommendations, discounts and special offers, thereby creating the ultimate personal shopping experience. Analytics and the connected society creates new models and opportunities to connect with customers by understanding the behavior that leads to their buying patterns.
By giving customers what they want, whether it be a specific price point, convenient delivery, customer service or any number of benefits that knowing the customer brings, retailers in all sectors can gain a competitive advantage by differentiating their brand. By integrating analytics throughout the entire retail process, from merchandising and marketing all the way to store and website management, merchants can create a profitable enterprise by catering to their customers in a specific targeted way. Knowing what the customer wants allows retailers to “work lean” and spend less time and money guessing what will work.
For the brick and mortar retailers a good analytics package combined with their point-of-sale terminals will allow them to analyze many data points including real-time customer traffic patterns, dwell times, and path analysis. This information can be used by store managers to improve staff allocation and customer checkout, and marketers can use analytics to improve product placement, create more relevant displays, and analyze customer basket contents to understand purchase patterns.