Why Retailers Are Getting So Excited About Big Data Analytics
Think of the possibilities…
IF the weather forecast predicts the first hot weekend of the summer, AND Google analytics shows a spike in the number of searches for “red swimsuit,” THEN increase in-store stock of swimsuits AND display our best selling red swimsuit in store windows… a fashion retailer may instruct their big data analytics system.
This simplistic example of rule-based event processing, illustrates how progressive retailers can beat their competitors to the punch, or sale, by predicting and preparing for upcoming sales trends with more precise accuracy. Complex event processing, or CEP, combines data from multiple sources in order to infer events or patterns.
With the advent of the Internet of Things, and our increasingly digital lives, the number of data sources has never been greater. Meaning, that with the right data analytics system, we can predict upcoming trends better than ever.
IF more than five people currently in the store have clicked on the same type of item online in the past month, THEN announce an offer for that item type on the in-store public address system, AND instruct a sales assistant to tend that area of the store.
Smart retailers will use big data analytics to create competitive advantage
Through the use of in-store technology like radio frequency identification (RFID), combined with loyalty systems and online behavioral data, retailers can use CEP to react to visiting customers in real-time. Forward thinking retailers are realizing that knowing who is in their store, and what they are likely to buy is an incredibly powerful sales tool.
IF in-store swimsuit stock drops below 65% AND warehouse stock is below 50% AND the weather forecast predicts hot weather in the coming weeks, THEN reorder more swimsuit stock from the manufacturer.
RFID systems also allow retailers to connect their entire value chain, meaning CEP can be used to tie inventory to sales predictions and other variables, in order to ensure stores will always have enough stock to meet demand. In fact, a well-integrated inventory and analytics system can do all this automatically, saving on staff costs for the retailer while reducing errors and optimizing re-supply.
IF a concert is scheduled in a major local venue AND we have items tagged as related to the artist, genre or venue, THEN better display those items in-store AND send marketing emails to the appropriate demographic in our mailing list.
The possibilities created by big data analytics are seemingly endless. As the number of data sources continues to increase, the possible combinations of data streams will only be limited by our imaginations. Advanced IoT solutions, such as the Mojix ViZix platform, are redefining predictive analysis, integrating it into supply chain and management systems and, in doing so; they are taking the retail industry to new levels.