By Mr. Gaurav Khurana, Chief Marketing Officer PAYBACK India
The retail sector is undergoing a transformation at a fast pace with changing consumer dynamics and purchase behavior powered by one of biggest game changers in the history of retailing – the era of Big Data Analytics. This is a platform that puts the customer first at every step of the demand and supply chain. The only thing we need are the famous drones to fly by and drop your shopping at your doorstep! Whilst we wait for this magnificent retail miracle to come by, let’s take a look at India’s retail story.
In the burgeoning retail sector filled with multiple options, lucrative deals, and offers, cash-backs and loyalty points, Big Data Analytics rules. Engaging the ever-so-well-informed customer of today is becoming a major demand in retailing. Brick and mortar stores and online stores are all competing to cater to the same customer and beginning to strategize their stock keeping and seasonal requirement through predictive analytics collected over millions of transactions and buying dynamics on a daily basis.
The retailer of today is smart, savvy and armed with tools that enable them to logically plan seasonal sales and predictive buying by analyzing buying behavior regionally, nationally and globally. They can forecast demand using algorithms that track millions of transactions every day which is itemized and this helps collect data on favorite brands, popular products, and fast moving items. This way they can track the demand for goods and determine when to drop prices by a simple method of “markdown optimization”. Hence, giving customers many reasons to revisit them and replenish their supplies for daily need items, apparel, household supplies, kids supplies, even hardware, and electronics.
The system identifies individual customer needs and can engage each one digitally. This innovation takes the whole shopping experience to an exciting level. The art of engaging customers starts by simplifying the retail experience by analyzing the demand for specific products, bundling in exciting deals to entice the customer and finally pricing the complete package with accelerated rewards to drive repeat transactions.
This new-age style of retailing is now shifting over from the savvy online stores to the brick and mortar stores where one can use loyalty rewards and promotional schemes to purchase the items of their desire. The discerning modern day customer is well-aware of this and actively seeks such retailers at every step. It also adds great value to a customer’s pocket, thus building engagement, loyalty and creating a demand within the existing ecosystems, which will further drive new customer acquisition through word of mouth, social media, advertising and many such communication channels used by the industry.
When we look at this picture from a global perspective, the whole game changes into bigger demand, supply, and pricing technique developed to consistently entertain the evolution of the customer buying behavior. International brands are doing exactly this, and this is their path to success. Billions of customers who buy from the Amazon Global Store, for example; have opened the gateway to a shopper’s paradise replete with offers, discount schemes, on demand services, prime delivery services to mention a few.
Predicting trends, another innovative tool used by retailer today is hyper-local personalization through integrating social media behavior and zeroing in on customer choices, most loved products and brands, wish lists and dozens of activities a customer may perform online. Linking the retailer directly to a customer, it also helps analyze the next purchase a customer is about to make, this is called “identifying the customer”. Armed with this, seasonal discounts, price optimization, and gratifications are offered to excite the customer in the future. And if one were to take this to a personalized engagement level, it’s only a smart choice to drive your customer to visit the physical retail store for an all-round sensory experience and add great value to the business.
This all goes to prove that big data analytics can have an incremental impact on businesses. It supplements the retailers with the power to build a stronger retail ecosystem that benefits consumers as well as the retailers. It is a fact that brands in today’s scenario need to magnify their vision and look beyond just forecasting data. To create history, they must evolve as fast as their customers do. And this is only possible when they practically determine and deliver the most desirable and rewarding experience to the consumer. Big data plays a pivotal role and provides retailers with an unprecedented opportunity to evolve and bring unique solutions to cater to each life-stage of various businesses.