February 24, 2017

Seizing the Big Data opportunity in Retail

4 minute read

Technology is changing at a rapid pace, and with it the capabilities of the new technology and the insights it can provide to us, are expanding every day.

While it can be hard to anticipate future trends, it’s clear that these new sources of data will be a big boost for retailers, but only if businesses use the information they are given wisely. Nigel Gatehouse, CEO at Quant Marketing, said: “Businesses that recognise and capitalise on these new data opportunities will achieve real competitor advantage. When it comes to the future of data, there are a few things we can say with certainty. The growth in big data means there will be more data, coming from an increasingly wide range of sources, such as social data, Government or open-source data and locational data. At the same time there will be more pressure to deal with the data faster, in real or near real-time. In addition, customers will look to businesses to make use of their data, so long as they use it to provide an enhanced experience with real benefits.”

One way that data is changing the way we manage customer relationships lies in the use of geographical location data. This can be used both analytically, through heat maps, or similar visualisation techniques, to improve understanding about the customer. Or in real-time, to deliver immediate and localised benefits. Unless individuals actively opt out, a wide range of apps – including any dedicated app you have created to promote your business – now constantly track where your customers are, every hour of the day.

The Starbucks app, for instance, stores data on individual customer preferences, provides a payment facility and is an important channel for promoting special offers: but it also, through the use of geographical data, able to detect if the customer is currently in or near one of their stores.

Less focussed on individual customer data, Video Queue Analysis enables stores to manage staffing and staff workloads, as well as improve the customer experience, by detecting the number of customers waiting to be served, and alerting staff so they can take appropriate action. Some brands are reportedly utilising this new technology to analyse things such as where customers are looking as they stand in the queue in order to put their advertising in prime locations.

Footfall analysis is another method whereby businesses can use aggregate data to calculate customer potential in an area, as well as what proportion of that business is going to competitors. That, in turn, is key information for developing local business strategies. Foursquare have used this type of data successfully and are set to expand it in the coming months with their new app, Attribution, which should be able to give accurate footfall figures for high-street stores.

Using beacon technology means you can deliver marketing messages uniquely tailored to their location. For example, as a customer walks past your store, a text/push notification including a personal 10% discount valid for the next two hours or a reminder of products the customer has recently looked at online, could entice them in. Beacon technology was used successfully last year by Tesco, who rewarded lucky grocery shoppers by sending ice cream offers directly to their mobile phones during a heatwave.

Meanwhile, the technical magic of RFID tags has embedded geographical location in products ranging from clothes to bottles of beer. These are small radio frequency identification tags which are being put on products to track where they move to. Now you can know where products are at any given moment, where they are going and – by matching product location to personal location – who they are going with. The age-old marketing challenge, of matching product and price to purchaser, and therefore being able to determine the impact of a particular discounting initiative, is on the verge of being resolved.

In fact, using location data in this way is beginning to sound ‘outdated’, as even newer technologies add in types of data once merely dreamed of. Amazon Echo not only responds to voice commands: it also stores them; which means that analysts are already thinking of ways that data can be extracted and used to aid marketing decisions. Certain words or an accent, perhaps, might provide clues to age and social class which in time, could reveal regional origins – all sources of data that it is difficult to ask a user about directly.

Elsewhere, new facial recognition techniques and wearable technology points to a future in which AI is used to identify everyone a customer interacts with during the day.
Our CEO, Nigel Gatehouse believes there are lessons to be learned. He said: “The future is going to deliver new sources of data that we will need to store and process in real-time. In-store data capture points, such as Kiosks, mobile (Wi-Fi/iBeacons) and video recognition, are already delivering new and exciting personalised ways to deal with customers.

“At the same time, AI combined with new recognition technologies – voice recognition (Amazon Echo and Siri), facial and eye recognition for passport security, fingerprint recognition in phones – are providing a new data stream increasingly capable of supporting not just identification and security functions, but an overall more proactive approach to customers.”

We may not know the precise future of data. But we already know that analysis needs to capture behavioural data “out there” within the retail environment. We need to do this through the development and deployment of technologies that make sense of this data, delivering real-time campaigns and recommendations directly to the consumer during the sales moment.

Posted by Christian Stilwell

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Seizing the Big Data opportunity in Retail

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