With increased competition, the importance of retail analytics has grown in the last few years and shows no signs of slowing down. According to global analytics and advisory firm Quantzig, the analytics market is set to more than double between 2016 and 2020, 114% growth, surpassing $7 billion.
More and more retailers continue to experience increased ROI using BI and analytics tools and services that help them analyze data and improve business performance. These tools also help retailers to reduce operating costs and enhance the customer experience.
"Retail analytics can be a game changer for retail and CPG companies across the globe. The applicability of analytics across the retail value chain—tracking offline and online customer behavior, creating targeted marketing campaigns, merchandize planning, website performance assessment and social media analysis, provide a multitude of benefits ranging from increased sales, targeted cross-sell and up-sell strategies to reduced costs based on optimized media investments," Aviral Sinha, lead Quantzig analyst, told FierceRetail.
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Outside of the U.S., analytics are also growing in importance as well and will increase more than 20% between 2015 and 2020 in the regions of North America, Asia Pacific and EMEA. In Europe, the UK, France and Germany are leading countries utilizing retail analytics.
According to Sinha, retail organizations that have leveraged analytics to analyze their data have a better understanding of their customers across their entire lifestyle. Therefore, these retailers can provide a better shopping experience through valued-added services, offers and discounts.
"Powered by data-driven insights at the individual customer level, these retailers can plan their marketing initiatives in a more targeted and effective fashion, apart from providing personalized recommendations based on post conversation triggers on social media," Sinha added.
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What are some of the programs that retailers are using to track data successful harness data? Sinha noted the use of POS, CRM, Marketing, Media and ERP to collect data and the use of statistical analysis tools such as R, SAS, SPSS, and Tableau, Qlikview, Spotfire, etc. for advanced visualization and reporting.