Big Data holds the key to the future of the ecommerce industry.
Due to an unexpected increase in demand, and 2020’s effect on the high street, the ecommerce industry is flourishing. The UK has the highest adoption of online shopping and by 2030 technology will affect a third of tasks in UK retail. Overall, businesses have adopted new services and technologies since many must prepare to make faster and informed decisions.
The growth of internet-based technologies has provided retailers a set of higher customer service capabilities, including dynamic pricing, real-time service, and the ability to provide the consumer personalised offerings, all through the adoption of ecommerce channels.
For the retail industry in particular, the prevailing customer sentiments determine the latest trends that inform decision making, including everything from product design to management, to marketing messages. This means that accurate and up-to-date customer analytics and intent predictions are a key competitive advantage for any organisation that relies on customer loyalty.
Today, big data is transforming marketing and online retail sales in ways that were not achievable just a few years ago. It has changed the way these teams engage with customers by allowing businesses to make smarter decisions. As a result, this helps to increase profits and customer satisfaction.
We have seen an increased focus on analytics as a necessity for all industries. But particularly for retail who have relied on technology to keep their businesses afloat, where accurate and up-to-date insights are critical to meet customer demand that rapidly fluctuates.
Those who are already using a data strategy to find new ways to engage with customers, new opportunities for efficiency, stay ahead of the trend curse, and maximise the cost-effectiveness of their marketing efforts will have a better basis on which to make important business decisions based on the data generated.
Before we can break down the benefits, it is useful to define the term and to broaden your understanding of Big Data.
What is Big Data?
According to McKinsey, big data analytics in a retail chain can improve the operating margin by around 60%.
Big data describes a large volume of data that is used to reveal patterns, trends, and associations, especially relating to a person’s behaviour and interactions.
Most importantly, big data enables ecommerce companies to improve decision making, gain a competitive advantage, enhance their performance, products, and operational processes. It also allows customer behaviour analysis and prompts the discovery of actionable insights.
Today’s web technologies have given rise to a huge amount of relevant data in the ecommerce environment. These have been broken down into three common factors:
- Volume: Huge amount of data driven by business.
- Variety: Various types of data from multiple sources – mostly unstructured.
- Velocity: The speed at which big data is generated.
With the 3Vs of big data, companies have access to all sorts of information about customers’ experiences, financial transactions, and the competitiveness of the marketplace.
Big Data is increasingly valuable to ecommerce firms, by transforming data into business insights and contributing to solid decision making to expand the commercial value of your business. As a result, companies that utilise big data hold a potential competitive advantage over those that do not since they’re able to make faster and better-informed decisions, provided they use the data effectively.
But how can ecommerce businesses pull all this data together? How can they take the right information and put it to use so that it can be valuable, actionable, and make the company work better?
To attain real value out of data analytics, retailers need to consider aggregating their data across disparate systems into a single, unified view throughout the organisation. Once in place, they will gain true insights which will help plan customer retention strategies.
Data Clarity are always on top of the challenges and opportunities this presents for retailers. We conduct data audits for organisations to highlight the current capabilities, strengths, weaknesses, and opportunities.
Check out the infographic below for more information on the power of data and how retailers in particular can benefit from this valuable resource and thrive through ecommerce channels. To discuss your current strategy or to arrange an audit to discover how you can do more, contact our data experts today.