Retailing can be a tough and competitive environment but it is surely no coincidence that the brands that are managing to perform well tend to embrace the idea of analytics and use it as a lever for profitability.
Data and analytics are proving to be transformational in the retail arena are here are some examples of how it is used by forward-thinking retailers.
Making a difference to merchandising tactics
Retailers refer to the set of products it carries in its store as assortments and it is necessary to review and revise their assortment on a regular basis if they are going to keep enticing customers to buy what they see.
Analytics makes it easier to identify products or ranges that are proving too slow to sell and are, therefore, not viable to remain in stock.
It is proving to be the case that analytics are key to allowing a retailer to optimize their assortment process and the technology makes it easier to identify new products that are expected to deliver a strong return on investment.
Your business could use the same tools to streamline your sales process and focus on selling more by identifying how to optimize your assortment.
Getting your marketing strategy right
The success of a business is often dictated by how successful its marketing strategy is and that is another key area where analytics comes into play.
There are two distinct aspects of marketing analytics that are pivotal to success, namely pricing and promotional analytics.
There is little doubt that the retail landscape has been fundamentally impacted by a change in consumer attitudes that means price sensitivity is a key focus for many retail organizations.
One example of pricing analytics would be using pricing models and levers to identify the ideal price where consumers are most likely to be inclined to buy. Predictive models can also be used when it comes to promotional analytics, using behavioral data to target customers with offers they are likely to be most interested in.
You could use these same techniques embraced by savvy retailers to improve your own marketing strategy.
Getting the supply chain right
Any business will struggle if it doesn’t have a robust and reliable supply chain and that is another area where analytics makes a difference.
Using an analytics-based approach to inventory management is helping top retailers make daily decisions that help them to find products at the right price, get them into the store in a timely manner, and improve customer satisfaction rates in the process.
You could improve your own operational efficiencies with the help of supply chain analytics and when you have the confidence to be able to communicate to your customers with predicted delivery times you know you can achieve, it allows you to deliver a superior customer service experience.
So many top retail brands understand the power of analytics and that is a hint that should be taken if you are looking to achieve a similar edge with your business performance.