Utilizing big data successfully is more than just collecting and aggregating information; it also requires using analytics and predictive science to formulate strategies that work.
For apparel retailers, it has long been a lack of information on customer needs and the latest trends that have made it difficult to capitalize on certain opportunities. Thanks to the arrival of big data — the fashion industry’s biggest trend — all that is changing. However, this trend won’t stop; the role of big data will only get bigger, and it will touch every aspect of business.
What retailers, both online and brick-and-mortar, are hoping to gain from all this information is a 360-degree view of the customer. Indeed, data visualization software is now making it easier to see customer behavior and derive actionable insights. This is giving businesses what they need to provide shoppers with the right product at the right moment — and at the right price.
So, welcome to the new apparel industry, where data, analytics, and machine learning are the new forces driving results and maximizing efficiency. In the long run, everyone from stores and investors to the consumers and the environment will benefit.
Data Is Already Being Mass-Produced
Data has been around since people started doing business. It’s long been the “residue of business,” able to be seen in virtually every aspect of business operations, from accounting ledgers and purchase receipts to stock shelves.
But humanity is just now entering the golden age of data.
With the arrival of cutting-edge software, widespread use of connected devices, and continued development of the Internet of Things (IoT), big data now has a much bigger role. And that’s because data is being produced at a record pace. Consider this statistic: More data has been created in the last few years than in the entire history of mankind. Smartphones, which are set to see 6.1 billion users globally by 2020, are creating data at mind-blowing paces, and represent the most promising avenue for apparel retailers to learn more about their customers.
Utilizing big data successfully is more than just collecting and aggregating that data; it also requires using analytics and predictive science to formulate strategies that could work. Data visualization techniques can spin the data into concise, convincing and clean imagery, allowing for a multifaceted view of every dimension. Then, decisions can be made. The end goal of all of it should be to discover actionable insights and execute.
Data Visualization Is the Key to Unlocking Insights
Data is useless if it is not analyzed and put into a clear and easily digestible format. All those data points can get complex and overwhelming, which makes it data mining essential so as to generate new, easy-to-read information.
That’s where data visualization comes into play. Think about how complex the data may seem when just listed in front of you on a spreadsheet. You may get a headache just looking at it. Data visualization is the process of taking that complex data and transforming it into charts, images, graphics and even cartoons. It makes the information not only clear and simpler to comprehend, but exciting — because the visual will shed light on what course of action your business should take next.
Additionally, considering that research has shown that humans process visual information 60,000 times faster than text, it’s evident data visualization represents the best way for apparel retailers to quickly understand shopping trends and behavior, and learn how to optimize operational efficiency, reduce business expenses and perfect the customer experience.
Data Visualization Is Coming to Brick-and-Mortar
Think about how e-commerce giants like Amazon employ big data and data visualization. The online site constantly collects information about its customers in order to build comprehensive customer profiles. This places Amazon in a much better position to make personalized offers to each shopper, and thus helps to establish a solid relationship with all sorts of visitors. Obviously, the ability to glean through literally trillions of data points has its advantages.
For the brick-and-mortar world, access to all that data is difficult, which makes data visualization near impossible. But good things are happening, and it’s only a matter of time before corner fashion shops know everything about their customers as soon as they enter through the doors.
Mobile beacons, one of the most promising creations from the Internet of Things for the apparel industry, are a great example of big data’s arrival to physical storefronts. These devices are helping brick-and-mortar shops collect virtual boatloads of data about customers. Led by companies like Facebook, mobile beacon technology allows marketers to communicate with shoppers at physical locations through Bluetooth connectivity.
These beacons study movement and behavior within store by connecting to a shopper’s smartphone. After gathering that data, conveying it in a visual way, and then analyzing it, marketers and business owners can have a much better picture of what that customer wants. The beacons can even be used to send shoppers targeted offers in the store, in real time. Previously, such abilities belonged only to e-commerce retailers with deep pockets. Disruption has arrived, though. And the potential is tremendous.
Data Visualization Enables Continual Improvement
If data visualization helps you implement changes that increase your bottom line and satisfy customers, don’t stop there. Data never stops. It updates every second, and you must remain prepared to not only adapt with it, but get out ahead of the latest trends using predictive analysis.
One company that is helping brick-and-mortar shops stay on top of data is Prism. This company uses in-store security cameras to capture all sorts of data points, such as when the store is most busy and what areas are getting the most foot traffic. All gathered data is put into nice data visualization charts in real time, giving business owners the historical trends and live information they need to make quick and effective business decisions. This not only makes deciding where to deploy staff and display promotions much easier, but also makes managing inventory more effective, reduces loss by theft, and helps track and quickly solve maintenance issues (like a broken light fixture or collapsed shelf).
With such data visualization, you can also see product performance based on location, shopper searching patterns, and the way people flow through the retail space. This makes performing A/B testing much easier. For example, you can try two different displays for a new pair of shoes, and see which one converts the most sales over a week. Clearly, great opportunity to boost profit awaits with data visualization.
As long as retailers remember that data analysis is a cycle of continuous optimization, rather than a line toward an end goal, then they can see consistent improvement across the board over time. And that will lead to sustainable success.
Point-of-Sale and Point-of-Purchase Data Is Now Available
Sam Hui, a professor at NYU’s Stern School of Business, notes that “retailers are all using scanner data to track what happened at the point of sale,” but they don’t know what led the customer to the cashier line. Hence, there exists an important part of the shopping process that is not being analyzed.
Simply put, some retailers still aren’t using all their resources and data visualization technology to develop an understanding of what led the consumer to that purchase. Thus, they remain with only the knowledge of what the customer purchased. While this can certainly help with making targeted offers to a shopper, it does not assist businesses in the challenged apparel industry with understanding how that shopper’s needs will evolve in the future. It keeps them from being agile and adaptable, and makes it less likely they’ll be able to keep up with the times.
The technology is there, though. Location analytics is making it easy to track consumer behavior and create profiles for customers. Mobile beacons, as mentioned above, are a good example of this. Other technologies that leverage smartphones, sensors and existing Wi-Fi networks have been developed too. RetailNext has been a leader in location analytics, for instance.
RetailNext tracks more than 800 million shoppers a month throughout retail chains, providing powerful analytics and data visualization charts that can help any retailer. Results have been tremendous for retailers that use RetailNext, as same-store sales increase an average of 8-10 percent and loyalty signups increase five- to tenfold.
Data Visualization Helps Prepare for the Future
Despite all the new technology and the clear benefits already being provided by data visualization, things like managing inventory, getting rid of low-selling products, and scheduling staff remain common troubles for fashion retailers. This doesn’t have to be the case.
Technological solutions, especially the Internet of Things, can show you when you’ll need to place another order so that you never run out of product. Location analytics can give you a clear picture of how people move through spaces in your shop, which can make it easier to decide product placement and thus reduce waste. Additionally, data science and predictive analysis can inform you when your store’s foot traffic will be greatest and least, thus enabling you to schedule workers as efficiently as possible.
In the end, all of this equals reduced costs, higher profit, and most importantly, happier customers. Without the ability to visualize all this complex data, it probably wouldn’t be possible.