Big data plays an intrinsic role in our day-to-day lives as well as in the way our future is being shaped, particularly in the retail industry. Data is emerging as one of the key assets of any business.
Essentially, businesses can mine actionable intelligence from the millions of data points we are in contact with daily, consciously or not. This can prove a massive point of competitive differentiation for retailers, who can harvest information to create experiences tailored to individual customers. This leads to greater levels of engagement, development of a stronger brand affinity, and, potentially, increase in sales revenues.
What is big data, that it allows experts to have such an insight into the way we not only live our lives, but the way we think? In the simplest of terms, it refers to the vast amounts of data generated in our hyper-connected society. Every time you connect — whether to the internet, through your NOL card, or even by using an ATM — you generate data ... effectively your passive digital footprint.
You also have an active digital footprint, which is the information that you knowingly share across social media and so on. When analysed, this paints a clear picture of who you are as an individual, including your likes, dislikes, habits, shopping preferences, favourite forms of entertainment and more.
Frost & Sullivan predicts that the big data market in the GCC will reach $635 million by 2020, which represents significant opportunity for the retail sector. Through big data, retail outlets can learn more about their customers than ever before, giving them an unprecedented opportunity to tap into consumers’ lives in a meaningful way.
An interesting example of this involves the US retailer, Target. In 2012, an article entitled ‘How Target Figured Out A Teen Girl Was Pregnant Before Her Father Did’ went viral around the world. It introduced people to the concept of big data being used to tailor marketing based on information they gather about customers.
As it turns out, the story wasn’t exactly true, but it clearly defines how important the role of big data can be in the retail space. A family preparing to welcome a newborn is looking to buy all sorts of things, and by being able to harness that potential revenue through clever marketing would clearly be a boon.
Now, imagine the ways in which such knowledge could be used within the region, where the retail sector is a massive contributor to GDP and expected to reach $284.5 billion by 2018. There are benefits to be enjoyed by both sides of the retail equation, by shoppers and retailers alike.
For the shopper, big data allows them the opportunity to feel unique, and that they’re the first to know. They receive customised content based on their preferences and habits. Today, technology has evolved is such as a way that wi-fi, combined with sensors such as iBeacons to enable this push swiftly and accurately.
For example, someone who frequents a particular coffee chain can download or push an app, which provides them with an on-the-spot discount code for their favourite latte whenever they’re close to an outlet. This makes them feel special because they’re getting an exclusive offer based on what they like, while being conveniently within the vicinity of an outlet in which they can apply the discount.
The customer has the impression that their favourite brand cares about them by sending content that they appreciate, while the coffee chain benefits by reeling in sales that could have otherwise been lost.
Another example: a clothing retailer can identify which of their customers have the greatest spend and on what items, then this can be cross-referenced with the consumers’ social media prevalence. They can then invite those customers with a high spend and considerable social media influence to an exclusive preview of their upcoming collections.
The customer experience with the brand will receive a significant boost for the preferential treatment they receive, while the store will benefit from positive word of mouth, social media presence (through selfies, location tags, and so on), and increased customer loyalty.
Ultimately, this leads to greater sales figures, as customers who are more engaged with a brand are more likely to be loyal and have a higher spend. There are already numerous ways in which retailers can use big data to build their customer experience and personal preferences to the levels it should be, but the key to success is in gathering, storing, and translating big data into usable statistics.
This is where companies such as Avaya can step in, to provide the required technology to make it all possible.
We have worked with large players to evolve existing networks to become more big data-ready, such as with Kuwait’s Al Shaya Group and the Dubai World Trade Centre. What this can result in is the vastly improved ability to build loyalty schemes, proactive and contextual marketing, as well as building omnichannel capabilities with a seamless transition between channels, and effectively using the accurate consumer contexts across each of these.
At the end of the day, it’s the small details that win a customer over — being greeted by name when they enter a store, receiving a discount to spend on their birthday or anniversary, or even getting recommendations based on their past habits.
This is what elevates customer experience to the next level, and retailers need to jump aboard the big data revolution if they are to stay relevant to their increasingly connected consumers and demanding customer. At the end, it is how far retailers know and deliver on the individual preferences of their customers.
The writer is Vice-President, Hospitality WorldWide, Avaya.
