Looking Ahead, Five Big Ways that Big Data will Transform Online Commerce
Online shoppers have an endless choice of where to shop and what products to buy anytime, anywhere, on most every digital channel imaginable. With the rise of social networks and mobile devices, online retailers face a number of challenges associated with delivering the most relevant reporting dashboards in order to make decision-making predicated upon data, analytics and insights.
In today’s consumer-led economy, one that revolves around “social, mobile and local,” Big Data technologies and analytic reporting across a number of retail processes are giving retailers the competitive advantage. How so? The numbers, the stats, the preferences, the behavior of consumers are providing monetizable insights and social tracking tools specifically designed to improve collaboration, customer engagement, and the testing of new innovations.
According to IDC Retail Insights report, in 2013, approximately 50% of retailers were using big data and analytics to make informed pricing and marketing strategies, with more retailers planning to use big data and analytics in the next 2 to 3 years. Without question, Big Data is transforming how enterprises have traditionally done business by enhancing website search optimization, enabling companies to interact with their customers with new customized digital marketing platforms, and providing companies with a deep understanding of their customers’ behaviors on multiple touch points.
For those companies that want to increase their market share and remain relevant, Big Data and advanced analytics can transform their business in the following key areas:
What types of shoes did your customer purchase last season? What products did your customer view online but did not buy? From notifying individual shoppers about sales that suit their personal preferences to real-time coupons sent to shoppers’ smartphones, Big Data provides retailers with unprecedented insights and predictive analytics into their customer’s preferences, behaviors and shopping habits so that they are better able to push customized, local, and loyalty-driven content.
With the power of Big Data, retailers can anticipate and predict what their customers will buy and when, enabling companies to improve their supply chain process with automated product sourcing. Additionally, incidents of abandoned online shopping carts are reduced as the content being pushed out to the consumer by the retailer is personalized, and customers are provided with an accurate shipping window.
Retailers who truly capture the power of their customers’ data are able to predict what each customer will buy before the customer even realizes that they’re ready to purchase a new product. With Big Data, retailers are able to analyze interactions across multiple channels in order to determine shopping patterns, preferred products, and how products are used. These insights enable retailers to provide real-time product matches with target customer segments.
How much does an item cost? When is the best time to buy? Are consumers reacting to a marketing campaign on social media? Online retailers rely on dynamic pricing to compete and require data ranging from competitor pricing to regional preferences and customer actions.
An unhappy customer’s sentiment can be exponentially increased and broadcasted online. Through statistics collected about a consumer’s shopping patterns via insights from profiles on social media channels, emails, phone calls and live chat features, Big Data provides assessments on negative consumer sentiment, enabling retailers to quickly and effectively resolve issues to enhance the user experience.
The quadruple whammy of social networking, mobility, the cloud, and analytics is creating a new playing field. It used to take years before a new technology would impact a business, but now connectivity and collaboration are turbocharging the pace of change. And Big Data is leading the way by continually transforming how companies interact with their customers. Implementing a strategic Big Data initiative is essential to helping retailers remain competitive and attract new market share.
The biggest limitation in Big Data as it pertains to eCommerce isn’t the technology. It is the ability of human beings to realize which problems can be solved in the near term. There are opportunities for entirely new businesses built on the ability of large amounts of data to bring a benefit no one else saw. The number of business models ready to be disrupted is also beyond our imagination at the moment, but certainly retail and consumer goods are at the top of the list.