It is not breaking news that big data is revolutionizing retail in an unprecedented manner. With plummeting cost of data storage and processing power, big data has changed the way decisions are made and have proved to be as much as 6% more accurate and effective than conventional decision-making techniques and methodologies. It offers an ocean of opportunities to be explored and is capable of reinforcing each and every aspect of retail management with shocking insights. From amongst a plethora of possibilities, two infrequent avenues of leveraging big data in context of some specific sectors of retail are discussed in brief.
Retail chains engaged in sales of grocery and other perishable items are always concerned about shelf-lives of their inventory; despite having advanced refrigeration technologies, part of the problem related to supply chain, logistics and value chain of perishable goods are far from the point of alleviation. A big data mind-set can be an alternative and perhaps, a better approach. For example, a retailer plying his trade in eastern Arizona of U.S.A might be interested in knowing how much turkey he should order for Thanksgiving Ceremony, which is due in a month, so that he can reap maximum profit and cut down waste. The answer lies in the ability to correlate seemingly disparate variables like availability of turkey of required size, population of that locality, the influx of tourists and non-residential citizens, financial liquidity, spending power & country’s GDP, routes of trucks and commercial vessels to name a few. While some of the factors mentioned above are surely part of the retailer’s thought process, many are not included, but are necessary to optimize the solution. Needless to say, only big data analytics can let the data, speak and reveal the truth by taking into account the bigger picture.
Another interesting application of big data analytics is in lifestyle & fashion stores. Most of such stores are equipped with customized retail software solutions, POS hardware and CCTV camera. The last equipment mentioned is usually deployed to detect & prevent shoplifting and monitor staff activity. But these video footages have great potential to emerge as a strategic advantage. Previously inconsequential factors like movement of traffic within the aisles of the store, duration of pause in front of a particular product shelf, whether it was admired and the customer picked it up or not (if not, then what is the reason – high price, wrong color, texture or size?), preferred timings of shopping, demographic distributions of customers and even companions – all of these can be quantified and analyzed. This leads to accurate decisions regarding offering discounts, positioning of product shelves & variety of inventory, etc., which in turn will enhance sales figures.
As it appears to be, big data is playing the same role in streamlining retail business, as was played by retail software a few years back. While retail software is indispensable for today’s retail business, big data analytics is not far behind and is gathering steam at a much faster rate, thus complementing each other and adding more value.