Big Data Analytics: A New Path for Retailers to Make Changes

Big Data Analytics: A New Path for Retailers

Only by turning customer data into insights and using the data to guide the development of marketing plans and sales planning can we turn these cold numbers into customer intimacy, binding retailers to their customers.

Data shows that by the end of 2013, China's e-commerce market reached $10.2 trillion, a year-on-year increase of 29.9%. When e-commerce is in full swing, the traditional retail industry is being squeezed, and the online and offline encounters are very different: reduced customer traffic, poor performance, and even forced to close stores ...... physical retail operations are in a quagmire. In the face of the strong impact from the e-commerce, entity retailers have begun to think about how to change, a series of new attempts. Some retailers are not willing to be reduced to "fitting room" retailers bravely test O2O, through the online and offline channels. While data from more channels is reshaping business models, retailers are also seeing the business value it contains. The rich customer insights from the data are also driving "customer-centric" business transformation.

In the era of big data, retailers needing to break out of the crowd should explore how to seize the first opportunity, and SAS gives the following suggestions based on the best practices of foreign retailers:

Customer-centered, data-driven marketing management, successful transformation from multiple channels

With the help of technology, retailers can communicate with consumers through more channels, such as social media, mobile apps, location-based services, and email, etc.

These channels are also a great way for retailers to communicate with consumers. email, and more channels to communicate with consumers. More bridges of communication also bring richer customer information, and it's not enough to just get that information. Only by turning customer data into insights and using the data to guide the development of marketing programs and sales planning can these cold numbers be turned into customer intimacy, binding the retailer to the customer.

1. Macy's: There are words just for you

Macy's, the famous U.S. department store chain, has set up an e-commerce division, Macy's.com, in the hope that consumers can synchronize with the latest listed products and promotions wherever they are, and look for the magic of shopping. macy's. com has set up an Internet customer insights division. com has set up an Internet customer insight department, using big data analysis to improve personalized marketing, advertising strategies and other aspects of the rapid development of online channel marketing, and successfully transformed from traditional offline operations to an omni-channel business model. In the face of fierce competition, Macy's.com is in dire need of more accurate real-time decisions about customer preferences. Macy's believes that gaining customer insights across omni-channels is key to improving customer satisfaction and revenue growth. To more efficiently understand and evaluate the impact of online marketing campaigns on brick-and-mortar sales, Macy's.com significantly strengthened its analytics capabilities with a SAS solution, and has since changed its inefficient marketing approach of sending out mass generic emails to more granularly categorize customers and target promotional emails. Surprisingly, the reduction in email sending frequency did not reduce the number of visitors to the site, and the email unsubscribe rate was reduced by 20%.

2. Harry & David: Getting a Taste of Analytics

After experiencing a downturn in performance due to the recession, leading U.S. gourmet food and gift retailer Harry & David utilized analytics to determine who its target customers were, how and when they wanted to receive promotions, and which groups were most likely to drive sales growth. likely to drive sales growth, and to make sense of the data for future growth. In the first few months, the marketing team made progress in capturing customer behavior and preferences. Within a year, further progress was made in customer segmentation, customer lifecycle and concurrent value analysis. Within three years, Harry & David saw a 14% increase in new customer retention, a 7% increase in sales generated by customers, and a 10% increase in high quality loyal customers. With SAS Campaign Management, Harry & David has gained valuable customer insights, for example, by importing external data and analyzing historical transactional behavior, they have concluded that customers attracted by social channels are more desirable for further nurturing. Customer profile modeling and management also provide a solid basis for sales forecasting. As a result, Harry & David got a taste for data analytics and embarked on a data-driven marketing journey.

3. Chico's: Say goodbye to guesswork, say goodbye to intuition

The ready-to-wear women's apparel retailer Chico's FAS Inc. has more than 1,000 stores across the United States. In addition to brick-and-mortar stores, Chico's conducts marketing campaigns through catalogs and online channels. Faced with an industry recession, Chico's decided to capitalize on the customer information it had accumulated over the years and drive business decisions from there. But the reality was tougher than it looked, as data from multiple Chico's brands was difficult to integrate and the company didn't have the capacity to process large amounts of data. Chico's needed a system that would provide a reliable track record for managing and integrating large amounts of data, and wanted to be able to use the data without data staff or programmers. Solution: Marketing Automation (SAS? OnDemand: Marketing Automation). This is an enterprise-class solution that includes a suite of predictive analytics and data mining tools that allow marketers to plan, test and execute campaigns of any size.

The solution helped Chico's plan holiday promotions. After using the solution, Chico's reported a quarterly profit of $17 million, compared with a loss of $42 million in the same quarter the previous year, according to the data. With the help of the marketing automation solution, Chico's is able to segment its customers and differentiate the results of different promotional campaigns. chico's divides its target group into three categories and acts accordingly: the first category of customers are those who want to be the first to buy a new product. The first group of customers are those who want to be the first to buy new products and receive catalogs and e-mails with new products in all sizes and price ranges. The second group of customers are those who are interested in discounted products, and Chico's mails these customers more targeted, thinner catalogs and promotional flyers. The third category is Web site users, to whom Chico's pushes e-mails tailored to the online customer's consumer preferences.

Chico's has been able to quickly adjust its promotional strategy once it identifies items that aren't selling well, and it has been able to recover more of its lost customers at three times the rate of its previous efforts. Through big data analytics, Chico's identifies more popular items from past transactions and selects promotions accordingly. As a multi-brand retailer, by determining consumer preferences, Chico's is now able to plan promotions that direct loyal customers to one brand as well as another, opening up more potential sales opportunities. Marketing plans that used to take 30 days to produce now take just four days to create. The team also has the ability to create accurate campaigns faster.

With big data analytics, retailers can use past transactions to guide campaigns, create in-depth campaigns that actually meet customer needs, and personalize the consumer experience to build stronger customer relationships and ultimately drive revenue growth.

Precise predictions from insights to guide strategic planning

Predicting the future from summarizing the past and observing the present is another magic of big data. It also inspires retailers to optimize the customer buying experience by making accurate and actionable demand forecasts guided by big data from the very beginning of the supply chain.

DSW: Size 7 or 9, I know!

Unlike the sizing flexibility of ready-to-wear clothing, consumers must choose the right size when purchasing footwear, which puts higher demands on the supply system of footwear retailers. DSW, the American footwear retail giant, utilizes SAS solutions to integrate its purchasing and supply systems. With the rational allocation logic of the SAS solution, DSW has a more accurate judgment on the supply of sizes. This made it possible to develop the "size by store" model. Previously, DSW had a standardized supply, with 12 boxes of shoes in each size being sent to each store. In fact, some stores only needed size 7 and 8 shoes, while they still received size 6 and 9 items. Data analytics can calculate the number of specific shoe sizes and styles needed in each region and the number of orders to be replenished in the event of fewer promotions and no out-of-stocks, ensuring that stores are well supplied with the right sizes and that replenishments can be made in a timely manner. Stores operate more efficiently, customers wait less, and satisfaction levels rise dramatically.

Reducing IT expenses, increasing flexibility, and creating value with high-performance analytics

The explosion of big data has given rise to highly flexible technologies such as visual analytics, high-performance analytics, and cloud-based applications. Thanks to on-demand, highly flexible technologies, retailers are dramatically reducing IT operational expenses and gaining more valuable insights from more advanced analytics.

SM-MCI: Analytics for the "King of Asian Department Stores"

SM Marketing Convergence Inc. (SM-MCI), a subsidiary of SM Group, operates the largest customer loyalty program in the Philippines. The program, which records the points earned by each customer at SM's shopping centers and stores more than a billion purchases, was not being effectively utilized, and SM-MCI needed a solution that would drive sales, improve operations, and increase customer loyalty at the same time. SM-MCI selected the SAS Visual Analytics solution, which combines in-memory analytics with advanced data visualization for business intelligence. Not only does it offer unmatched statistical computation power and speed, but it also presents the results in an intuitive way. It also eliminates redundant data planning and extraction transformation loading processes when new variables are added. From the more in-depth reports, SM-MCI is able to gain a deeper understanding of consumption patterns and identify trends that can be used to plan timely promotions, deliver better service, improve customer satisfaction, attract new members and identify profitable up-sell opportunities.

In developed countries, the rise of e-commerce has long proved to be a strong impact on brick-and-mortar retailing, and foreign retailers have accumulated more experience in fighting the impact. These practical experiences have given Chinese brick-and-mortar retailers, who have been threatened by e-commerce in recent years, more to think about: Emerging technologies such as cloud services, data visualization, and Hadoop are being applied in the retail industry and are developing rapidly, injecting vitality into the industry.

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