Businesses live and die by metrics. Everywhere, the sheer volume of data is being examined, reexamined and leveraged. Let’s take a look at one part of the business world – more specifically, the retail space – to see what this industry is doing in Big Data.
The term Big Data isn’t new and the idea of crunching numbers to determine what consumers will purchase has been around for as long as business has. What is new is the ability of businesses to take streams of data from disparate parts of business; Twitter feeds, Facebook accounts, apps and clickstream data – and combine that with logs from phone conversations, as well as more traditionally-structured data. Not only are we able to pull information from all of these sources, we now have software to plug the information into, as well as hardware that can churn millions of equations a second. When we have the right information and ask the right questions, truly amazing things can happen in predictive analytics and business intelligence.
Over the past six years, retail has been evolving. On an infrastructure level, it has been moving from a strictly physical space to a virtualized environment. At the point-of-sale, businesses have never tried so many different types of loyalty programs. Think of all the stores, warehouse clubs, museums, entertainment complexes and airlines where you hold a membership. Thanking customers is one reason to have a loyalty program, but the dollars behind giving back to the consumer – whether they are receiving airline miles or Disney Vacation Club perks – has a lot to do with tracking customer activity.
An informed business owner can increase sales through a comprehensive understanding of what their customers are doing. Most of the loyalty clubs from three years ago were focused on what the customers had done. They had purchased a cup of coffee or had stayed in a two queen bed hotel room. These types of metrics allow business owners to send offers to customers that, based on past performance, will be appealing to them. The challenge is that these types of offers may or may not be successful in predicting the success of altering current purchasing patterns. Furthermore, they aren’t the information that will successfully change customer behavior and disrupt the economy in a positive way for your company.
In the new economy, data analytics are not solely focused on past performance. Instead, retailers are looking to capture real-time metrics as consumers move through theme parks and stores. They are looking to see the path customers take as they move from the entrance of a park to the food stand or to a ride. Was there a trip to the bathroom for some nausea? And maybe a meet and greet was skipped because of a long line? How much did the customer spend on souvenirs? Where is the opportunity to increase spend, decrease pain points for high value consumers and maximize the overall experience? Disney is doing a fantastic job of using the analytics from their consumers – and they’re doing it with an radio-frequency identification (RFID) band that helps keep the Disney magic while it acts as big brother. Again, is that high value consumer waiting too long? Does a character need to know a child’s name for a birthday meet-and-greet? With active analytics, the answers are all in the numbers.
The scale and breadth of analytics are vast. The key to maximizing the potential for your company is to take a look at the information available to you and determine the information you’d like to be available to you. Are there insights that you need to help your company compete in the market? Everyone from grocery stores to entertainment conglomerates are leveraging analytics to increase their understanding of what the customer is saying – in real time.
Take a look at our BizTech Magazine article, “How to Become a ‘Real-Time Retailer,’” for more tech tips and best practices. Interested in learning more about data analytics and mobile POS? Download our white paper and data sheet for more information on this exciting retail trend.