Across the world, it’s generally accepted that digital technologies are disrupting every sector of the economy and redefining whole industries.
By effectively analysing data, businesses far and wide have been able to understand the different behaviours of customers, allowing them to identify and better meet their desires and expectations. In 2019, retailers will follow suit – turning to analytics to unlock insights that in the past, have been out of reach.
Extracting value from data
Retailers have traditionally struggled to extract value from their data, which usually includes information captured by POS systems, CRM applications and loyalty programs. Why is this important? Imagine wanting to get a specific present for someone this holiday season but finding out that it’s out of stock as your regular store couldn’t anticipate demand.
In order to harness the true benefits of their data, businesses need to adopt analytics tools that will allow them to gain better visibility across different facets of their business including sales, customers and inventory.
In 2019, retailers will place more emphasis on getting the most out of all their data and will focus on understanding the alternative data sources they have available, and the insights they can bring to the business.
Physical stores and online stores will complement each other
If I were to tell you that sales in physical stores were declining, it wouldn’t come as a surprise. But what may come as a surprise is the vital role physical stores still play in Australian retail when it comes to driving trust with brands and providing a route to purchase. Retailers need to have a multi-channel focus, ensuring their online and physical stores are integrated and work together – instead of being siloed and competing for business.
This means that data captured instore, needs to be used in addition to data about the online experience. It can be used to better understand customer needs and the reasons why they chose a product, their path to purchase, and their motivations for buying products in store versus online.
Data analytics KPIs
Whilst having sufficient data analytics tools is important, it’s vital that the retailer has the skills required to read and work with data. In 2019, we expect to see retailers implement KPIs around their data analytics capabilities so that all employees – no matter if they are on the shop floor or at the back room – become more competent and capable in working with data.
Recently, our Data Literacy Index revealed the correlation between an organisation’s data literacy and its enterprise value. Organisations that were not data literate were leaving US$500 million on the table in enterprise value. With that in mind, retailers will take steps to train their employees in data analytics and ultimately look to increase their overall data literacy abilities. The goal is for an organisation to have a workforce that is comfortable with data, not just one person. This means that various sectors (i.e. sales, supply chain, etc.) will receive the full benefits and advantages of data analytics.
While having the data at your disposal is important, it’s not enough – retailers need to learn how to get the most out of their data. In 2019, a broader range of retailers will begin to understand the benefits that can be derived from investing in data analytics and how it has the ability to affect the entire business – from instore to online and from sales to inventory.
By Jeremy Sim, Director Industry Solutions, Manufacturing & HighTech at Qlik APAC