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Where Retailers Should Focus Their Big Data Efforts

Sep 9, 2014   |   3 min read

Knowledge Center  ❯   Blog

retailers_big_data-1Few businesses are privy to as much consumer data as traditional brick-and-mortar retailers. But knowing more doesn’t always mean knowing what to do with it. We’ve identified three critical business questions big data can answer for retailers, revealing profitable opportunities to grow sales and profits.

Question 1: How Effective Are Promotions?

According to a recent article by the Boston Consulting Group, “Promotions are a common source of success and frustration for retailers.” Indeed, the article states that as many as 30-50% of promotions have no positive impact whatsoever on sales and margins. Worse, many actually do nothing more than reduce profits without leading to additional sales.

To determine whether a promotion achieves its goals, retailers should start by looking at the following data points:

Question 2: Which Customers Should We Target?

Good retailers want to attract as much foot traffic as they possibly can. Smart retailers want to attract the right traffic that will maximize sales and profitability. These retailers take the time to learn as much as they can about their best customers-the ones who buy more quantity or higher priced items.

This level of detail requires the retailer to invest in an infrastructure that has the capacity to capture and analyze data at a very granular level. Fortunately, this investment can reap big rewards by highlighting such important characteristics as:

Question 3: What Is the Best Way to Reach Customers?

We don’t live in the age of telegrams anymore. There are a number of different ways to reach out to your customers. But which is the most effective, postal mail or email? The answer can be the difference between throwing dollar after dollar on ineffective communications or steadily breaking through the clutter to reach your customers when they want in the way they want.

Once again, big data can provide important clarity on which communication methods will provide the strongest results:

Big data is sparking a retail revolution. Armed with improved business information and market intelligence, retailers are able to answer their most pressing questions and optimize key facets of their operations. Without question, obtaining and analyzing the right data to draw the right insights requires skill and effort. But for those businesses willing to do the work, they’ll be able to reap the rewards of an improved competitive advantage for years to come.

Looking for more ways to use data to achieve marketing success? Download “Using Customer Data to Achieve Email Marketing Success.”

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