3 Ways Retailers Are Using Big Data
Big data is a topic that is currently buzzing in the retail world. The reason is because many retailers believe that insights gathered from big data can help to make them more competitive in their markets. But what exactly is big data?
Big data is incredibly large volumes of information that are provided from various digital and non-digital sources. Due to advancements in technology, the ability to collect data that is relevant to the retail experience has improved dramatically. This has resulted in retailers having much more information to make important decisions with. Here are some of the top ways that big data is being used in the retail industry.
If you have ever bought anything on Amazon.com, you have probably noticed that after you made your purchase, you may have been shown advertisements for products that are made specifically for you. This is an example of big data being used to make customer recommendations.
Big data allows retailers to know what you purchased, and to be able to compare that to products purchased by other customers who made purchases similar to yours. Recommendations can then be made from these purchases. Making recommendations in this way, that are highly personalized, can be extremely effective in generating new sales. Many other companies are taking a tip from Amazon, and using big data in the same way now to generate recommendations.
Supply and demand are constantly changing in the retail industry. If your pricing is not responsive enough to fluctuations in supply and demand, then you could quickly find that your prices are too high or too low. Either one can cause problems.
Big data can help to prevent pricing problems by using supply and demand information, data about inventory supplies, competitor pricing information, etc, to help create optimum prices. Optimum prices keep prices high enough to make a good profit from the sale, but low enough to make it affordable and reasonable.
Big data can be extremely helpful for inventory. The reason is because inventories for many retail stores can include tens, or even hundreds of thousands of items. With so many items coming and going every single day, keeping track of stores, and knowing the exact location of the items can be very difficult.
However, with big data, real time information about inventory stocks can be kept. This can include how much is left, where it is located, etc. Every single time a sale is made, this data can be updated. Big data can truly make it easier to keep track of inventories in the industry of retail. It is just another impressive thing that big data can do.