What is Retail Analytics and why should Retailers care?
The use of analytics in the retail business allows retailers to gather extremely important and useful data from the inner workings of their business and customers. This data allows them to improve the experience for customers, provide the opportunity to utilize employee’s capability to the best for optimal work operations, and on top of all assists in boosting sales.
What is Retail Analytics?
Retail Analytics helps retailers with business insights related to sales, customers, inventory, marketing, operations, and other aspects important for decision-making.
Analytics is an important tool in any retailer's tool-box to succeed in the competitive world. It gives specific insights into the behaviors of customers alongside many general but vital information. This information can be utilized for running a successful business as it assists administrative teams in developing necessary steps wherever required.
Why is Retail Analytics important?
Many players in the retail industry have already recognized the importance of data. A survey by Alteryx and RetailWire covering approximately 350 retailers and brand manufacturers indicates that -
81% of retailers gather shopper insights and 76% consider insights to be critical to their performance
All successful retail businesses leverage data from their customers, merchandise, and activities to get meaningful insights. Incorporating analytics helps with a single and reliable source of truth regarding customers, their loyalty, their inclinations before buying something, and how they perceive or interact with the organization either in physical walk-in stores or through the website.
Retail analytics is particularly significant for online business retailers who need to build their brand image and get better results based on digital marketing.
More importantly, analytics can assist different stakeholders in making both short-term and long-term strategies to excel in their respective domains.
A real life use-case of Retail Analytics
Starbucks, an American company, could provide a better-personalized experience to its customers and organize their inventory for better quality products
Starbucks has secured its place as one of the biggest and most renowned coffeehouse giants around the world. Starbucks Corporation has 16,700 retail locations, which serve somewhere in the range of 50 million clients in 51 nations every week.
With the help of retail analytics, they analyzed trends followed by customers, the age group of customers they are serving and how location plays a role in sales. The following information, helps the brand make educated and informed decisions that prevent any kind of monetary risk.
They has been making the best practical use of the data they collect, and this is evident in their ever-evolving line of products, which makes sure that visiting a Starbucks never gets boring. For example, this year, they came up with six new products by analyzing customer trends. They added Almondmilk Honey Flat White, Coconut-milk Latte, Oatmilk Honey Latte, Iced Golden Ginger Tea, etc.
Apart from this, they use customer's data to continuously upgrade its online marketing strategies by engaging with their customers through surveys and e-mails.
They have enjoyed tremendous success as their total revenue has increased by more than 26% between 2016-2019, which helped them generate extra revenue of about 6 billion dollars.
Retailers who need to flourish in the coming months and years can't bear the cost of not infusing information into their decisions. Indeed, setting up the correct frameworks and figuring out how to accumulate intel could take some work; however, when you've aced it, the information and experiences you improve will make everything beneficial.
How are you utilizing retail analytics for your business? Feel free to contact us if you have any questions.